Regulatory Alerts2018-10-05
Central Bank of Tunisia Circular to Banks No. 2018-08 dated October 5, 2018
The Central Bank of Tunisia issued Circular No. 2018-08 to amend Articles 56 and 58 of its March 2017 monetary policy framework, mandating that counterparties continuously align refinancing collateral allocations with published CAER system haircuts and calculating non-negotiable asset values using the formula CV = O x (1 – H). This update replaces previous provisions to standardize risk coverage and collateral mobilization across banking operations. The circular takes effect upon publication, ensuring immediate compliance with the revised quantitative thresholds and valuation methodology.
Tunis, October 5, 2018 CIRCULAR TO BANKS NO. 2018-08 SUBJECT: Implementation of the monetary policy by the Central Bank of Tunisia. The Governor of the Central Bank of Tunisia, Having regard to Law No. 2016-35 dated April 25, 2016, establishing the status of the Central Bank of Tunisia, Having regard to Law No. 2016-48 dated July 11, 2016, on banks and financial institutions, Having regard to Circular to Banks No. 2017-02 dated March 10, 2017 on the implementation of the monetary policy of the Central Bank of Tunisia, Having regard to Circular No. 91-24 dated December 17, 1991 on division, risk coverage and monitoring of commitments as amended and supplemented by subsequent texts, Having regard to the Board of Directors' resolution dated June 13, 2018, Having regard to the Board of Directors' resolution dated August 29, 2018, Having regard to Opinion No. 60/2018 of the Control and Compliance Committee dated September 25, 2018, as provided for in Article 42 of Law No. 2016-35 dated April 25, 2016 establishing the status of the Central Bank of Tunisia, and notably its second paragraph regarding circulars having an urgent character. Decides: Article 1 - The provisions of Articles 56 and 58 of Annex II to Circular to Banks No. 2017-02 dated March 10, 2017 on the implementation of the monetary policy by the Central Bank of Tunisia are repealed and replaced as follows:
2 Article 56 (new): Allocation of collateral for refinancing operations between negotiable and non-negotiable assets. Counterparties must ensure, at all times, that the allocation of collateral for refinancing operations between negotiable and non-negotiable assets complies with the haircuts published by the Central Bank of Tunisia on its CAER system and on its website.
Article 58 (new): The value of non-negotiable assets after application of risk control measures is calculated according to the following formula: CV = O x (1 – H), where CV = potential collateral value, i.e., the refinancing amount permitted by mobilizing the asset for collateral purposes; O = value of the remaining principal balance on the claim; H = haircut(s) published by the Central Bank of Tunisia on its CAER system and on its website.
Article 2 - This circular takes effect from the date of its publication. THE GOVERNOR MAROUENE EL ABASSI