CMN Resolution No. 4803 - Criteria for Measuring Provision for Doubtful Loan Losses on Renegotiated Operations Due to the Covid-19 Pandemic

The Central Bank of Brazil, in accordance with Article 9 of Law No. 4,595 of December 31, 1964, makes public that the National Monetary Council, in an extraordinary session held on April 8, 2020, based on Article 4, items VIII and XII, of the aforementioned Law,

R E S O L V E S:

Art. 1. Financial institutions and other institutions authorized to operate by the Central Bank of Brazil are permitted to reclassify, to the level in which they were classified on February 29, 2020, the operations renegotiated in the period from March 1 to September 30, 2020, in accordance with § 3 of Article 8 of Resolution No. 2,682 of December 21, 1999.

§ 1. The provisions in the main text do not apply to operations:

I - with a delay equal to or greater than fifteen days in the payment of a principal installment or charges, on February 29, 2020; and

II - with evidence of the counterparty's inability to honor the obligation under the new agreed conditions.

§ 2. The provisions in the main text of Article 8 of Resolution No. 2,682 of 1999 do not apply to the renegotiated operations referred to in the main text of Article 1.

Art. 2. The institutions mentioned in Article 1 must keep available to the Central Bank of Brazil, for a period of at least five years, the documentation related to the credit analysis of the operations covered by this Resolution.

Art. 3. This Resolution enters into force on the date of its publication.

Roberto de Oliveira Campos Neto President of the Central Bank of Brazil