IAS 39 — Classification of failed loan syndications

Date recorded:

The staff presented the IFRIC with the fact pattern to be analysed. In the submission it was asked how to apply the definitions of categories to loans originated with the intention of syndication where the arranger fails to find sufficient commitments from third parties. The question was whether the surplus kept (that is, the failed part of the syndication) is always classified as held for trading or whether there are circumstances it could be classified as loans and receivables.

The IFRIC concurred with the staff analysis that intention to sell the surplus loan immediately or in the near-term always results in held for trading classification.

It was further noted that the October 2008 amendments to IAS 39 Financial Instruments: Recognition and Measurement permitted an entity to reclassify under circumstances financial assets out of the held for trading category. It was agreed that the agenda decision should note that fact.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.