Loss Given Impairment

Definition

Loss Given Impairment (LGI) is an estimated measure of credit loss that has been used in the context of the Asset Quality Review. It is different from Loss Given Default because it uses impairment (the accounting status) as the basis for estimates.

Formula

The measure can be related to the Cure Rate and the Loss Given Loss

$\mbox{LGI} = (1- \mbox{CR}) \mbox{LGL}$

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