Regulatory Alerts2018-04-03
Added · Updated
Foreign Currency Lending Ratio Directive 2018
Issued by Malawi's Registrar of Financial Institutions, the Banking (Foreign Currency Lending Ratio) Directive, 2018 restricts commercial banks from extending foreign currency loans except to forex-generating enterprises or strategically important businesses. The regulation caps such lending at ninety percent of a bank's preceding monthly average foreign currency denominated account balances and mandates monthly reporting by the tenth of each month alongside annual board policy reviews. Non-compliance triggers monetary penalties of up to fifty million Kwacha for institutions and ten million Kwacha for senior executives, alongside administrative sanctions, while formally revoking the prior 2011 directive.
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