Regulatory Alerts2014-07-21 | CD-SIBOIF-838-1-JUN11-2014Added · Updated
Norm on Reform of Articles 5, 14, 23 and 27 of the Norm on Credit Risk Management
The Board of Directors of the Superintendence of Banks and Other Financial Institutions amended Articles 5, 14, 23, and 27 of the Norm on Credit Risk Management to align with Law No. 865. The reform expands the definition of mortgage credits for housing to include new housing and lease contracts with purchase options, and raises the social housing credit threshold from thirty thousand to thirty-two thousand dollars. This adjustment applies to the establishment of provisions, mortgage guarantee appraisals, and appraisal periodicity for financial institutions. Specifically, housing credits up to thirty-two thousand dollars classified as Normal Risk now require a zero percent provision, and identical-unit mortgages in the same subdivision may undergo appraisals every five years instead of three.