Regulatory Alerts2020-06-09
Central Bank of Seychelles Notice on Financial Institutions Act Modifications, Foreign Currency Exposure and Credit Classification Regulations
The Central Bank of Seychelles issued this June 2020 notice to modify dividend distribution rules and adjust foreign currency exposure limits for all banks in response to the Covid-19 pandemic. It mandates that banks retain profits from 2019 and 2020, cap the short position to capital ratio at fifty percent, and expand eligible collateral definitions to include government guarantees under pandemic relief schemes. Furthermore, the notice reclassifies qualifying credits adversely affected by the crisis as Pass or Special Mention when renegotiated before July 30, 2020, while suspending specific provisioning sub-regulations for these loans.
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