Regulatory Alerts2024-06-12
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Large Exposures to Counterparty or Group of Connected Counterparties Directive SBB/87/2024
The National Bank of Ethiopia issued Directive SBB/87/2024 to establish prudential limits on commercial banks' exposures to individual counterparties and groups of connected counterparties. The framework caps aggregate exposure at twenty-five percent of total capital, designates exposures equal to or exceeding ten percent as large, and requires monthly reporting for those surpassing the threshold. Banks must adopt board-approved risk management policies, apply standardized calculation and collateral deduction methods, and submit a ninety-day action plan to achieve full compliance within three years.
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