Monetary Board of the Central Bank modifies banking regulations
SD. The Central Bank reported that the Monetary Board suggested several regulatory modifications with regard to the evaluation of assets and limits to the concentration of credit, with the idea of facilitating access to bank credit for low-cost housing construction projects, highway networks and the productive sectors in general.
These modifications were laid out by the Monetary Board in its last session on Thursday, 25 June 2015.
In this sense, in those cases which correspond to subjection to established dispositions in the Monetary and Financial Law 183 – 02, dated 21 November 2002, the principle body for Monetary, Financial and Exchange Policies in the country, set forth these amendments to public consultations for five days on the Central Bank webpage, with the objective of having the interested sectors express their considerations regarding these issues.
The points suggested by the Monetary Board are those of: the acceptance of fiduciary guarantees, bank financing with guarantees of the Dominican State, and the expansion of individual limits for loans with guarantees. With respect to the admission of trust or fiduciary guarantees, they indicate that in the first place, the entities of financial intermediation can concede credits excepting fiduciary guarantees that permit them to act as collateral for the reduction of banking risks, in the context of the Regulations of Evaluation of Assets (REA).
In second place, the Monetary Board Incorporated in the indicated modifications, that in the case of direct and indirect loans which might be granted based on the guarantee of the State, or that the funds for the repayment of the debt come from real cash flows assigned in the National Budget, which credits are considered to be of classification “A” for the purposes of the Regulation of Evaluation of Assets.
The third aspect of the modification suggested has to do with the individual limit of bank credit of up to 10% without guarantees and up to 20% with real guarantees, the entities of financial intermediation can loan up to 40% of their technical patrimony for a credit operation which is backed by the guarantee of the State or that the funds for the repayment of the debt proceed from cash flows assigned in the National Budget.
June 29, 2015
Category: DR News |