Regulatory Alerts2022-12-26
Instruction No. 002/2022-CSBF of December 20, 2022 on the Regulatory Capital of Credit Institutions
The Commission for Banking and Financial Supervision (CSBF) of Madagascar issued Instruction No. 002/2022-CSBF to define the composition, calculation methodology, and prudential reporting requirements for the Regulatory Capital of credit institutions and microfinance networks. The regulation mandates that regulatory capital be structured into Tier 1 (CET1 and Additional Tier 1) and Tier 2 components, establishing strict eligibility criteria for capital instruments, mandatory deductions for cross-holdings and intangible assets, and a 20% annual amortization schedule for subordinated debt maturing in five years or less. Institutions must submit annually certified capital declarations and special reports for material changes, while the CSBF retains supervisory authority to validate instruments, enforce transitional deadlines, and impose disciplinary or financial sanctions for non-compliance.