Regulatory Alerts2008-11-14
Added · Updated
Instruction No. 002/08-CSBF on Prudential Standards for Level 2 and Level 3 Microfinance Institutions
Level 2 and Level 3 Microfinance Institutions must maintain a solvency ratio of at least 15% and 12% respectively, calculated on available own funds and weighted risk exposures. These institutions must also ensure that total risk exposures to a single beneficiary do not exceed 10% of available own funds, and that credit commitments to management and board members do not exceed 15% of available own funds. Institutions failing to meet capital requirements or having negative own funds must immediately suspend new credit grants unless a pre-authorized guarantee fund mechanism is applied. Existing institutions exceeding these norms must regularize their status within six months of their classification or authorization decision.