Regulatory Alerts2021-09-30 | Circular No. 11 of 2021Supplementary Circular to Banking Act Directions on Classification, Recognition and Measurement of Credit Facilities and Other Financial Assets in Licensed Banks
The Central Bank of Sri Lanka issued this supplementary circular to establish consistent practices for licensed banks adopting SLFRS 9 financial instrument standards during the COVID-19 outbreak. It mandates banks to incorporate clear loan staging guidelines into their policies and permits prudent, case-by-case Stage 3 classification for borrowers facing direct economic restrictions or multiple restructurings. The instructions apply to all COVID-19 concession credit facilities, allow consultation with auditors for foreign currency sovereign exposures, and revoke the previous 2020 circular effective January 1, 2022.
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