Regulatory Alerts2020-07-27
IBA Circular No. 2 of 2020 - Loan Loss Provisions and Reserves
The Central Bank of Belize issued IBA Circular No. 2 of 2020 to prescribe regulatory procedures for establishing loan loss provisions and reserves, replacing the 2011 version. Licensed banks must calculate specific provisions at 20%, 50%, or 100% based on non-performing asset classifications and maintain general provisions equal to 1% of non-adversely classified loans. The circular also mandates quarterly evaluations, defines write-off timelines for unsecured and secured assets, and clarifies the distinction between regulatory capital computations and IFRS financial reporting requirements.
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