Regulatory Alerts2022-07-04
Added
BRPD Circular Letter No. 25: L/C Margin on Import Financing
The document mandates that banks maintain a 100% cash margin for Letters of Credit (L/C) covering luxury and non-essential imports, including motor vehicles, electronics, gold, jewelry, tobacco, and alcoholic beverages. For all other imported goods, a minimum 75% cash margin is required, with specific exemptions for child food, essential food items, fuel, life-saving medicines, medical equipment, capital machinery and raw materials for local production and export-oriented industries, agricultural products, and essential items for government priority projects. Banks are prohibited from providing any margin through existing or new credit accounts, requiring customers to source the margin from their own funds. This directive supersedes Circular Letter No. 14 dated May 10, 2022, and takes immediate effect.