Regulatory Alerts2019-01-24
Financial Services (Prompt Corrective Action for Banks) Directive 2018
Issued by the Registrar of Financial Institutions, this directive mandates prompt corrective actions for banks based on capital adequacy and liquidity ratios. It establishes tiered supervisory measures, including investment restrictions, management takeovers, recapitalization orders, and license revocation, tailored to undercapitalized or illiquid institutions. Replacing the 2014 directive, it empowers regulators to intervene before insolvency by suspending owner rights and executing resolution options through statutory management or a Deposit Insurance agency.
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