CMF published a circular (No. 2.252) that contains instructions for banking entities regarding COVID-19 loans from the Guarantee Fund for Small and Medium-Size Entrepreneurs (FOGAPE). The instructions will be in force until October 31, 2021. CMF has reported the progress in granting of loans under the FOGAPE COVID-19 program. CMF also released progress in loan installment rescheduling within supervised banks and cooperatives. Additionally, CMF extended the transitional treatment, applicable to provisions required for rescheduling commercial loans, from four to six months. CMF is also consulting on a regulatory amendment to simplify the registration process of long-term debt securities, with the consultation closing on May 22, 2020.
Instructions for FOGAPE
The key topics covered in the circular include exceptional measures for the treatment of provisions for loans in installments of the commercial portfolio, classification of debtors and calculation of arrears, establishment of procedures for checking debtor eligibility, and regular submissions of information to CMF. The circular details the information that the institutions must submit to CMF to adequately monitor the evolution of loan granting, rates registration, and the main features of these operations. For loans granted under the FOGAPE COVID-19 program, the provisions of the debtor's rescheduled installment loans, which meet the established conditions, may remain unchanged during the grace or rescheduling period granted by the financial institution. The maximum period is six months. This measure facilitates the conditions for providing financing and safeguards compliance with the prudential aspects of credit risk, by all financial institutions participating in the FOGAPE COVID-19 program.
Consultation on Long-Term Debt Securities
The amendment aims to facilitate financing options for companies in the context of the COVID-19 pandemic by easing the registration process of long-term debt securities. CMF also published a regulatory report evaluating the impact of the proposal, along with a regulatory brochure, frequently asked questions, and presentations on the proposal. The consultation process will be open until May 22, 2020. This eliminates the obligation to send for registration the copies of notices and communications that must be sent to shareholders on the occasion of a capital increase or the issue of convertible bonds and the prospectus. The proposal streamlines the requirements for registration of long-term debt securities, temporarily eliminating the obligation to include the certain records in the application for registration.
- Instructions for FOGAPE
- Progress of FOGAPE COVID-19 Program
- Progress in Loan Installment Rescheduling
- Extension of Transitional Relief
- Consultation on Debt Securities
- Circular 2.252 (PDF in Spanish)
Comment Due Date: May 22, 2020
Keywords: Americas, Chile, Banking, COVID-19, SME, FOGAPE, Credit Risk, Long-term Debt, Loan Guarantee, CMF
Leading economist; commercial real estate; performance forecasting, econometric infrastructure; data modeling; credit risk modeling; portfolio assessment; custom commercial real estate analysis; thought leader.
HM Treasury notified that, after considering all responses, the government intends to bring forward further legislation, when the Parliamentary time allows, to address issues identified in the consultation on supporting the wind-down of critical benchmarks.
EIOPA launched the 2021 stress test for the insurance sector in EU.
UK authorities jointly published the third edition of Regulatory Initiatives Grid setting out the planned regulatory initiatives for the next 24 months.
EC is requesting feedback on the proposed Commission Delegated Regulation on the content, methodology, and presentation of information that large financial and non-financial undertakings should disclose about their environmentally sustainable economic activities under the Taxonomy Regulation.
OSFI has set out the near-term priorities for federally regulated financial institutions and federally regulated private pension plans for the coming months until March 31, 2022.
Under the Italian G20 Presidency, BIS Innovation Hub and the Italian central bank BDI launched the second edition of the G20 TechSprint on the lookout for innovative solutions to resolve operational problems in green and sustainable finance.
ACPR published Version 1.0.0 of the RUBA taxonomy, which will come into force from the decree of January 31, 2022.
EBA proposed the regulatory technical standards on a central database on anti-money laundering and countering the financing of terrorism (AML/CFT) in EU.
ECB published its response to the targeted EC consultation on the review of the bank crisis management and deposit insurance framework in EU.
BCBS, CPMI, and IOSCO (the Committees) are inviting entities that participate in market infrastructures and securities markets through an intermediary as well as non-bank intermediaries to complete voluntary surveys on the use of margin calls.