Regulatory Alerts2011-01-01
Recommendation R on rules for identifying impaired on-balance-sheet credit exposures, determining impairment provisions for on-balance-sheet credit exposures, and reserves for off-balance-sheet credit exposures
The Polish Financial Supervision Authority issued Recommendation R to establish good practices for banks applying IFRS regarding the identification of impaired credit exposures and the calculation of impairment provisions and reserves. The document mandates that bank management and supervisory boards implement robust internal control systems, defined policies, and rigorous validation procedures to ensure accurate risk assessment and provisioning. It further requires banks to maintain detailed documentation on collateral valuation, historical loss data, and the methodologies used for both individual and collective impairment assessments.
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