Regulatory Alerts2016-04-28 | DOF 5434909Added
Resolution modifying the General Provisions applicable to credit institutions
The National Banking and Securities Commission amends Article 114 of the General Provisions applicable to credit institutions to update the Loss Given Default (LGD) calculation methods. The resolution establishes standard LGD rates of 45%, 75%, and 100% for specific credit categories and introduces exceptions for credits under commercial bankruptcy proceedings, allowing institutions to calculate LGD based on adjusted mass or updated loss estimates. It also permits a reduced LGD for agricultural credits covered by specific insurance policies that meet defined criteria regarding coverage, beneficiaries, and insurer ratings. These changes apply to credit institutions and become effective the day following publication in the Official Gazette.