Regulatory Alerts1994-12-01
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Notice No. 4/GGBM/94 - Setting Limits on Risk Concentration in a Single Entity
The Bank of Mozambique imposes limits on risk concentration for credit institutions, prohibiting risks with a single client from exceeding 25% of own funds and aggregate large risks from exceeding eight times own funds. The regulation defines large risks as those representing at least 15% of own funds and requires institutions to report such situations quarterly within 30 days of the quarter's end. Institutions must regularize non-compliant situations existing at the notice's entry into force by December 31, 1995, while specific exposures to governments and short-term interbank operations are exempt from these limits.
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