Regulatory Alerts2016-07-29
Circular to Banks and Financial Institutions No. 2016-03 of July 29, 2016
The Central Bank of Tunisia issued Circular No. 2016-03 to amend the risk division, coverage, and commitment monitoring framework for banks and financial institutions. The circular establishes a permanent 10% solvency ratio based on net equity and incurred risks, introduces specific capital requirements for operational risk calculated at 15% of average net banking income multiplied by 12.5, and sets transitional limits of 75% and 25% for net equity ratios effective from end-2017 and end-2018 respectively. It repeals and replaces key provisions of Circular No. 91-24, updates the solvency calculation annex with detailed credit and operational risk aggregates, and mandates compliance with applicable accounting standards for post-closing events.