Regulatory Alerts1998-09-23
Instruction No. 001/98-CSBF of September 23, 1998 on Foreign Exchange Positions of Credit Institutions
The Banking and Financial Supervision Commission (CSBF) of Madagascar issued Instruction No. 001/98-CSBF to require credit institutions operating in the country to maintain permanent foreign exchange risk management systems and a maximum 20 percent ratio between cumulative foreign currency positions and available equity. The regulation mandates the implementation of continuous recording, monitoring, and control procedures for foreign currency transactions, precise calculation of long and short positions from specified accounting elements, and periodic reporting to the General Secretariat based on asset or liability thresholds. Institutions failing to comply with these standards face corrective injunctions, financial penalties, and sanctions under Law No. 95-030, with the primary limit becoming effective on October 15, 1998.