Regulatory Alerts2004-04-21
Decision No. 002/2004-CSBF/P on the Risk Division Ratio of Credit Institutions
The Commission for Banking and Financial Supervision (CSBF) has reduced the risk division ratio for credit institutions from 30% to 25%, effective May 1, 2004. The decision amends counter-guarantee acceptance rules by excluding global multi-beneficiary guarantees from the risk base starting August 1, 2004, while capping individual counter-guarantee deductions at 80%, with existing guarantees fully phased in by January 1, 2005. Furthermore, it updates the signature commitment threshold to 20% and mandates that aggregate risks exceeding 15% of available equity must not surpass ten times the institution's total equity, requiring periodic risk declarations.
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