credit_impaired


The credit_impaired identifier is a boolean to flag if the customer credit quality is impaired.

According to the FCA Handbook, a credit-impaired customer is a customer who:

  • (a) within the last two years has owed overdue payments, in an amount equivalent to three months' payments, on a mortgage or other loan (whether secured or unsecured), except where the amount overdue reached that level because of late payment caused by errors by a bank or other third party; or
  • (b) has been the subject of one or more county court judgments, with a total value greater than £500, within the last three years; or
  • (c) has been subject to an individual voluntary arrangement or bankruptcy order which was in force at any time within the last three years.

Further, according to the European Commission Liquidity Coverage Requirement Delegated Act:

The definition of credit-impaired obligors or guarantors is both backward-looking (e.g. the obligor has declared bankruptcy, or has recently agreed with his creditors to a debt dismissal or reschedule, or is on an official registry of persons with adverse credit history) and forward-looking (e.g. the obligor has a credit assessment by an external credit assessment institution or has a credit score indicating a significant risk that contractually agreed payments will not be made compared to the average obligor for this type of loans in the relevant jurisdiction).

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