Regulatory Alerts1995-10-21 | 23997Added · Updated
Guidelines for the use of Bankers’ Acceptances by Institutions Licensed under the Financial Institutions Act, 1993
Licensees must classify Bankers' Acceptances into specific contra accounts or investment categories within the CB20 Report based on their role as intermediary or holder. Prudential rules mandate a 20% conversion factor for short-term trade-related acceptances and 100% for others, with risk weights applied according to Schedule III or II, requiring at least 8% qualifying capital. Acceptances are restricted to trade financing, pre-export financing, or self-liquidating receivables, with a maximum maturity of 184 days. Institutions were required to implement adequate written policies and procedures by March 31, 1995, and must submit quarterly portfolio reports to the Inspector of Banks.