Regulatory Alerts2016-01-01
Statutory Minimum Reserves Averaging Framework December 2016
The Bank of Tanzania issued Circular No. 1 to require all deposit-taking banks to maintain Statutory Minimum Reserves using a unified clearing account and reserve averaging framework. Compliance is calculated as 10 percent of average non-central government deposits and borrowings plus 40 percent of central government deposits, requiring daily clearing balances of at least 81 to 90 percent that average to the full required amount over a two-week maintenance period. The circular mandates biweekly reporting, imposes one million Tanzanian shillings daily penalties for late or incorrect submissions, and applies shortfall penalties based on Treasury bill yields plus 500 basis points to institutions failing compliance for consecutive periods.
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