Regulatory Alerts2022-05-17
BS8 Connected Exposures Policy
The Reserve Bank of New Zealand issued this policy to establish standard conditions of registration for locally incorporated banks regarding exposures to connected persons. It mandates that capital nature advances be deducted from Tier 1 capital and limits aggregate credit exposures to connected persons based on the bank's credit rating, with a specific cap for non-bank entities. Additionally, the document defines substantial interest and connected persons, requires exposures to be on arm's length terms, and permits netting calculations only under robust industry standard agreements.
Share