Regulatory Alerts2024-04-05
Bank of Namibia Determinations on Asset Classification, Suspension of Interest and Provisioning
The Bank of Namibia has issued Determination BID-2 under the Banking Institutions Act, 2023 to standardize how authorized banking institutions classify assets, suspend interest on deteriorating loans, and calculate loan loss provisions. The regulation mandates quarterly board-level loan reviews, defines precise criteria for default and non-performing status based on 90-day past-due thresholds, and requires the reversal of uncollected accrued interest when loans enter non-accrual status. It further establishes comprehensive provisioning rules for specific and general loan grades, outlines treatment for forbearance and restructured exposures, and ensures consistent financial reporting and stress testing across the Namibian banking sector.
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