Regulatory Alerts2021-10-03
Added
DFIM Circular No. 10: Classification and Provisioning of 'Other Assets' of Financial Institutions
Financial Institutions in Bangladesh must classify unadjusted prepaid entries remaining unadjusted for twelve months or beyond as 'Bad and Loss' with a 100% provision, and unadjusted prepaid legal expenses as 'Doubtful' with a 50% provision. Protested bills are classified as 'Doubtful' with a 50% provision if recovery is possible, or 'Bad and Loss' with a 100% provision if no recovery is possible, while other expenses or losses in 'Other Assets' are classified as 'Bad and Loss' with a 100% provision. These institutions must conduct these classifications quarterly on 31 March, 30 June, 30 September, and 31 December, submitting statements within 30 days after each quarter-end and uploading them to the Enterprise Data Warehouse. The instructions are effective from the quarter ended September 2021 and supersede previous directives in FID Circular No-08 and FID Circular No-06.