Regulatory Alerts2018-04-03
Added · Updated
Instructions for Implementing IFRS 9
The Central Bank mandates that banks implement International Financial Reporting Standard (IFRS) 9, recording the initial impact in the opening equity balance as of January 1, 2018. The document specifies that the general banking risk reserve balance from December 31, 2017, is transferred to retained earnings, with surplus amounts restricted from dividend distribution without prior Central Bank approval. For regulatory capital calculations, provisions for Stage 1 exposures are included in Tier 2 Capital up to 1.25% of total risk-weighted credit assets, while Islamic banks must apply these rules to specific funding sources. The Central Bank repeals circulars No. (10/1/1359) and No. (10/1/15583) and requires external auditors to certify the sufficiency of expected credit loss calculations.