Regulatory Alerts2024-09-01
Capital Adequacy and Leverage Ratios for Credit Institutions
The Banque de la République du Burundi establishes minimum capital adequacy and leverage ratios for credit institutions, mandating core Tier 1, Tier 1, and total capital ratios of at least 8.5%, 10%, and 12% respectively, alongside a 5% leverage ratio. It defines specific conservation, countercyclical, and systemic risk buffers, standardizes the calculation of credit, market, and operational risk-weighted assets using prescribed weighting rates, and requires monthly reporting and quarterly publication of these metrics. The Circular replaces prior regulations, grants the Central Bank authority to impose higher ratios based on institutional risk profiles, and sets clear eligibility criteria for guarantees and foreign correspondent ratings.
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