the probability of expected losses their volume and possible impact on the

The probability of expected losses their volume and

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the probability of expected losses, their volume and possible impact on the indicators, describing the earnings of the company (the results of respective stress-tests (if available), developed by the Central Bank of the Republic of Armenia for insurance companies, may also be used for conducting the analysis and assessments. Furthermore, the results of the stress-tests may be used for adjustment purposes only in case of highly probable scenarios, which should be justified by the supervisor), 9. the facts and trends, known by the supervisor due to new information, but not yet reflected in the statements of the insurance company, that can affect the indicators, describing the earnings of the insurance company. 10.the amendments of requirements of laws and other legal acts of the Republic of Armenia, related to the calculation of technical reserves and other issues, their possible impact on the indicators, describing the earnings.
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L – Factors, adjusting liquidity When adjusting the indicators, used in calculation of the L1-L2 sub-components ratios, calculated on “L” component in accordance with Appendix 1 of this Regulation, the results of analysis of actual abilities of the insurance company to meet its obligations and fund its assets in a timely manner and without significant losses, their trends and expected changes are being taken into consideration. In particular, the adjustments are being conducted by analyzing and assessing the following: 1. the expected changes and trends of amount of highly liquid assets of the insurance company. The adjustments may be tightened in case of negative trends of the mount of highly liquid assets of the insurance company, if the liquidity ratio of the insurance company is close to its threshold, 2. the changes and trends of amount of liabilities of the insurance company, the comparability of trends of the share of overdue demand liabilities, liabilities with the maturity period of up to 30 days in the total liabilities; and the highly liquid assets, 3. the real level of highly liquid assets, because in some cases the insurance company might not have possibility to be in command of the funds, considered as highly liquid. In such a case, the supervisor should make appropriate adjustments in calculation of the respective indicators, describing the liquidity, by not including the amount of such assets in calculation of highly liquid assets, 4. the level of concentration of the allocated funds by the type of instrument and the borrower. In this respect, it is necessary to analyze the impact of possible unfavorable event on the real level of liquidity of the insurance company, 5. the amendments of requirements of laws and other legal acts of the Republic of Armenia, related to the calculation of liquidity of the insurance company, the expected changes of the level of liquidity of the insurance company, due to the amendments, 6. the ability of the insurance company to attract additional liquidity in case of possible deterioration of liquidity of the insurance company, 7.
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