GUIDELINES ON RISK BASED CAPITAL ADEQUACY – REVISED REGULATORY CAPITAL FRAMEWORK. REF: BRPD CIRCULAR LETTER NO. 05 DATED 31.05.2016.

Please refer to the BRPD Circular No. 18, dated December 21, 2014.

As per section 3.1.3 of “Guidelines on Risk Based Capital Adequacy – Revised Regulatory Capital Framework for banks in line with Basel–III”, general provision/general loan-loss reserve eligible for inclusion in Tier 2 capital is limited to a maximum 1.25% of credit risk-weighted assets.

Henceforth, the entire general provision maintained against unclassified loans and advances as per regulations will be considered as capital under Tier-2. As such, Footnote No. 08 on page-08 (general provision/general loan-loss reserve eligible for inclusion in Tier 2 will be limited to a maximum 1.25 percentage points of credit risk-weighted assets calculated under the standardized approach) of the said guidelines is superseded by this circular.

This instruction will come into force with immediate effect.

Source: https://www.bb.org.bd/mediaroom/circulars/brpd/may312016brpdl05e.pdf

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