2018-10-23 | BSD/DIR/GEN/LAB/11/027

Transitional Arrangements : Treatment of IFRS 9 Expected Credit Loss for Regulatory Purposes by Banks in Nigeria

The Central Bank of Nigeria (CBN) issues a letter to banks and discount houses, outlining transitional arrangements to soften the impact of adopting the IFRS 9 Expected Credit Loss model on regulatory capital. The four-year arrangement involves utilizing the Regulatory Risk Reserve (RRR) to offset the additional ECL provisions, with any excess amortized over the transition period. Banks must submit monthly Capital Adequacy Ratio (CAR) computations, reflecting pre and post-amortization figures, to the CBN for monitoring purposes.

Nigeria

Central Bank of Nigeria

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