Regulatory Alerts2014-09-22
Transfers from Retained Earnings, Appropriated Profits and Qualifying Reserve Funds
The South African Reserve Bank’s Office of the Registrar of Banks requires all banks to obtain prior written approval before reducing qualifying reserve funds, including transfers out of appropriated profits. Banks must submit applications confirming that their capital adequacy ratios will remain at least one percentage point above regulatory thresholds and that remaining common equity tier 1 capital ensures ongoing compliance. The directive excludes internal reserve fund transfers, IFRS-driven reductions, and specific foreign branch or subsidiary transfers that do not impact consolidated qualifying capital.
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