Rules Governing Credit Risk Exposure Classification and Provisioning

Stage 1 or Regular Category Any exposure for which there is no significant increase in credit risk since origination (SICR) or otherwise are considered high quality or exhibit indicators of low credit risk. Indicators of low credit risk include, but are not limited to: i. The borrower has a low risk of default; ii. The payments are not past due by more than 30 days; iii. The borrower has a strong capacity to meet contractual cash flow obligations in the near term; and iv. Adverse changes in economic and business conditions in the longer term may, but will not necessarily, reduce the ability of the borrower to fulfil contractual cash flow obligations.