Division 4 INVESTMENT LIMITS

F1The investment shall be limited to the following amounts:

1. (i)

   for bonds issued or guaranteed by Member States or institutions of the Union, EUR 250 million per Member State or institution; bonds issued or guaranteed by regional or local authorities or government-owned and/or government-controlled public enterprises or institutions can be included under the limit of the respective Member State, provided that they have a credit rating of not less than ‘ AA ’ or its equivalent;

2. (ii)

   for bonds issued or guaranteed by other sovereign borrowers, their regional or local authorities or government-owned and/or government-controlled public enterprises or institutions, or by supranational borrowers, with a credit rating of not less than ‘ AA ’ or its equivalent, EUR 100 million per issuer or guarantor;

3. (iii)

   for deposits with and/or debt instruments, including bonds, of an authorised bank, the lower of either EUR 100 million per bank or 5 % of the bank’s own funds;

4. (iv)

   for bonds of corporate issuers with a credit rating of not less than ‘AAA’ or its equivalent, EUR 50 million per issuer;

5. (v)

   for bonds of corporate issuers with a credit rating of not less than ‘AA’ or its equivalent, EUR 25 million per issuer;

6. (vi)

   for holdings of collective investment funds with a credit rating of not less than ‘AA’ or its equivalent, EUR 25 million for each such vehicle.

The investment in any single bond issue, subject to the limits given in point (a), shall not be more than 20 % of the total amount of such issue at the time of purchase.

The investment in any single counterparty, subject to the limits given in (a), and cumulated between instruments where necessary, shall not be more than 20 % of the total assets.

The ratings referred to in these guidelines shall be those applied by at least one of the major international credit rating agencies, as generally understood.F2 Once the Commission has become aware of a downgrade below the minimum rating requirements, it shall endeavour to replace the corresponding investments.

If the rating of a bond is higher than the rating of the issuer or the issuer has no rating, the rating of the bond is applicable.