Regulatory Alerts2010-10-01
COBAC Regulation R-2010/01 on Risk Coverage for Credit Institutions
The Central African Banking Commission (COBAC) issued Regulation R-2010/01 to mandate that subject credit institutions maintain a permanent risk coverage ratio of at least 8%, calculated from net equity against total incurred credit risks. The regulation establishes detailed weighting rates for asset and off-balance sheet items, defines deductibility rules for guarantees, and specifies state-specific convergence criteria for CEMAC and UMOA commitments. It further outlines compliance procedures, including periodic reporting, dividend distribution restrictions during non-compliance or negative net positions, and the Commission's authority to issue injunctions and impose disciplinary sanctions.
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