Regulatory Alerts2013-03-26
DBFIA Practice Direction No. 4: Treatment of Interest on Loans and Other Interest-Bearing Assets
The Central Bank of Belize issues this Practice Direction to prescribe accounting and reporting requirements for interest on loans and other interest-bearing assets held by licensees under the Domestic Banks and Financial Institutions Act. It mandates that loans ninety days or more in arrears be placed on a non-accrual basis with accrued interest reversed from income, while permitting interest capitalization only when the borrower demonstrates normal repayment ability. Licensees must implement written policies governing these treatments and read this directive in conjunction with companion practice directions on loan loss reserves and asset classification.
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