Regulatory Alerts2024-05-20
Circular to Banks on Treatment of Leased Assets for Regulatory Purposes
The Bank of Botswana directs all domestic banks to classify right-of-use (RoU) assets under IFRS 16 according to their underlying accounting designation for regulatory capital purposes. Tangible RoU assets must be risk-weighted at 100 percent and included in capital and leverage ratio denominators, whereas intangible RoU assets are deducted directly from regulatory capital. These requirements take effect immediately upon issuance and mandate documented accounting policies to ensure consistent implementation.
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