The Bank of Mauritius, or BoM, issued revised guideline on credit risk management, which supplements the existing regulations and guidelines. Where this guideline imposes more stringent requirements than those in the existing regulations and guidelines, such requirements shall apply. The guideline supplements guidance provided in the International Accounting Standard (IAS) 39 of the IASB.
The guideline specifies that the role of the board of directors and, through it, the chief executive officer, is to manage the credit activity of a financial institution with integrity. They shall remain accountable and liable for actions taken, or not taken, during the time they were in office, when such actions were called for using normal prudence. The guideline aims to: promote:
Sound credit risk and valuation policies and practices dealing with loans and similar other financial instruments
Sound risk management processes appropriate for the nature of business of the financial institution
Adoption of an active, anticipatory approach to assessing risk and losses in the loan portfolio
Adequate disclosure of provisions for credit losses, both collective and specific
The guideline will become a focal point of reference for all requirements of the BoM for credit risk policy formulation and management. It applies to all deposit-taking financial institutions regulated by the BoM. A financial institution may want to establish a more comprehensive and sophisticated framework than that outlined in the guideline. This is acceptable, provided all essential elements of the guideline are fully taken into account.
Related Link: Guideline on Credit Risk Management (PDF)
Effective Date: August 18, 2017
Keywords: Middle East and Africa, Mauritius, Banking, Credit Risk Management, Guidelines, BoM
ECB published a decision allowing the euro area banks under its direct supervision to exclude certain central bank exposures from the leverage ratio.
ESAs launched a survey seeking feedback on the presentational aspects of product templates under the Sustainable Finance Disclosure Regulation (SFDR or Regulation 2019/2088).
ECB published input of the European System of Central Banks (ESCB) into the EBA feasibility report on reducing the reporting burden for banks in EU.
EBA published an Opinion addressed to EC to raise awareness about the opportunity to clarify certain issues related to the definition of credit institution in the upcoming review of the Capital Requirements Directive and Regulation (CRD and CRR).
ECB finalized the guide on assessment methodology for the internal model method for calculating exposure to counterparty credit risk (CCR) and the advanced method for own funds requirements for credit valuation adjustment (A-CVA) risk.
FED is proposing to temporarily revise the capital assessments and stress testing reports (FR Y-14A/Q/M) to implement the changes necessary to conduct stressed analysis in connection with the re-submission of capital plans, using data as of June 30, 2020.
FED adopted a proposal to extend for three years, with revision, the information collection under the market risk capital rule (FR 4201; OMB No. 7100-0314).
EBA published a voluntary online survey seeking input from credit institutions on their practices and future plans for Pillar 3 disclosures on the environmental, social, and governance (ESG) risks.
APRA is consulting on updates to ARS 210.0, the reporting standard that sets out requirements for provision of information on liquidity and funding of an authorized deposit-taking institution.
FED released hypothetical scenarios for a second round of stress tests for banks.