Additional Notes to Circular 88-1

Bank of the Republic of Haiti

Additional Note Circular 88-1

To Regulated Financial Institutions

Under Circular 88-1, which entered into force on April 1, 2021, banks are required to include verified Retained Earnings (RE) in the calculation of Core Tier 1 Capital. In other words, the cumulative Net Profits (NP) of the current fiscal year are excluded from the calculation of these capital funds as of the reporting date.

However, to facilitate the transition, the BRH allows regulated financial institutions to apply NP in the calculation of Core Tier 1 Capital as of the reporting date during the first year of implementation (June 2021–March 2022) according to the following terms:

• First quarter declaration of implementation: inclusion of 80% of cumulative current NP;
• Second quarter declaration of implementation: inclusion of 60% of cumulative current NP;
• Third quarter declaration of implementation: inclusion of 40% of cumulative current NP;
• Fourth quarter declaration of implementation: inclusion of 20% of cumulative current NP.

From June 2022 onwards, cumulative current year Net Profits will no longer be admitted in the calculation of regulatory capital.

This additional note forms an integral part of Circular 88-1.

Port-au-Prince, October 28, 2021.

[Signature] Jean Baden Dubois Governor

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