Use the Sovereign Limits tab region of the Limits window to define sovereign limits for a particular country. A sovereign limit is the total amount a company is willing to risk on all of the counterparties that reside in a certain country. Defining sovereign limits enables you to monitor risks such as government intervention and regional instability. Sovereign limits are weighted.

Prerequisites

• Define counterparties and corresponding country information for the countries that you want to create sovereign limits. See: Counterparty Profiles.

• Define global limits. See: Defining Global Limits.

• Define weightings. See: Limit Weightings.

To define a sovereign limit

1. Navigate to the Limits window.

2. Choose the Sovereign Limits tab.

3. Query or enter the Company that you want.

4. Enter the Country for which you want to create a sovereign limit.

5. If necessary, enter an Expiration Date for this company and country combination.

6. To use this limit, enable the Authorized check box.

7. In the Limit Amount field, enter the maximum amount that you are prepared to risk on counterparties that reside in this country. Enter limit amounts in the reporting currency.

8. Save your work.