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Recital 7

Recital 7

(7)The method for identifying derivative transactions with only one material risk driver should be performed at inception only, where such derivative transactions have been identified at inception as having only one risk driver, because that single risk driver is a basic characteristic of those transactions and is therefore not expected to change. Where, at inception, derivative transactions have been identified as having more than one risk driver, the process for identifying the material and most material of those risk drivers should be undertaken on a quarterly basis so that any changes in those transactions can be appropriately reflected in the mapping of those derivative transaction to the relevant risk categories.

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