Regulatory Alerts2025-11-10 | NCF-13Technical Standards for Classifying Credit Risk Assets and Establishing Sanitation Reserves for Investment Banks
The Central Reserve Bank of El Salvador issued Technical Standards NBCR-09/2025 requiring investment banks to classify credit risk assets and establish minimum sanitation reserves based on expected losses. The regulations mandate that all credit exposures be evaluated monthly, with reserve percentages ranging from 0% to 100% depending on the debtor's risk category, while allowing specific collateral values to offset the risk exposure. Furthermore, the rules define strict criteria for accepting guarantees, including digital assets, and establish procedures for handling restructured or refinanced debts to ensure prudent risk management.
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