Regulatory Alerts2017-08-24 | 29529Added · Updated
Reporting of General Reserves or Provisions for Losses on Assets
The Central Bank of Trinidad and Tobago clarifies that line 30 of the CB100 report must comprise the sum of general reserves for asset losses, general loan loss provisions, and general provisions for security losses as defined in specific CB20 items. General reserves and provisions contribute to qualifying capital subject to a limit of 1.25% of risk-adjusted assets after deductions. This directive applies to all institutions licensed under the Financial Institutions Act, 2008.
[LOGO] CENTRAL BANK OF TRINIDAD & TOBAGO Eric Williams Plaza, Independence Square, Port-of-Spain, Trinidad, Trinidad and Tobago Postal Address: P.O. Box 1250 Telephone: (868) 625-4835; 4921; 5028; Fax: (868) 627-4696 E-Mail Address: info@central-bank.org.tt Website: www.central-bank.org.tt
July 26, 2012
CIRCULAR LETTER TO ALL INSTITUTIONS LICENSED UNDER THE FINANCIAL INSTITUTIONS ACT, 2008
REF: CB-OIFI-1738/2012
REPORTING OF GENERAL RESERVES OR PROVISIONS FOR LOSSES ON ASSETS
The Central Bank of Trinidad and Tobago (the Central Bank) wishes to clarify the treatment of general reserves / provisions for losses on assets, as some irregularities were identified during an examination of the CB100 (Capital Adequacy) and CB20 (Monthly Statement of Condition) regulatory returns.
Please be advised that the figure reported under line 30 of the CB100 report should comprise the sum of:
- General Reserves – Losses on Assets (as per item 330301 on the CB20)
- General Loan Loss Provision (as per item 140901 on the CB20)
- General Provision for Security Losses (as per item 131201 on the CB20)
In addition, we ask that you note that general reserves / provisions for losses contribute to a company’s qualifying capital, subject to a limit of 1.25% of risk adjusted assets after deductions. The CB100 form has the automatic functionality whereby 1.25 % of total risk adjusted assets is compared with the value inserted at line 30 (PART I-Qualifying Capital) and the appropriate amount to be considered as qualifying capital is taken at line 31 (PART I-Qualifying Capital).
We trust that the information provided helps in clarifying the instructions. Should you require any further assistance, please feel free to submit your queries in writing to:
Mrs. Alisha Corbin Senior Examiner Policy and Payments System Unit Financial Institutions Supervision Department Central Bank of Trinidad and Tobago Eric Williams Plaza, Independence Square Port-of-Spain
Yours sincerely
[SIGNATURE]
Carl Hiralal INSPECTOR OF FINANCIAL INSTITUTIONS
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