Regulatory Alerts2018-01-01
Capital Adequacy for Development Finance Institutions Directive 2018
Issued by the Registrar of Financial Institutions in Malawi, this Directive mandates development finance institutions to maintain a minimum paid-up capital of USD50 million and a 15 percent core capital ratio against risk-converted assets. It requires boards to implement comprehensive internal assessment processes, limit equity investments in non-subsidiaries to 35 percent, and allocate up to 25 percent of annual profits to a mandatory general reserve. Non-compliance triggers enforced capital injections by shareholders and monetary penalties of up to K50 million for institutions and K10 million for directors or senior management.
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