Additional Note to Circular 88-1 to financial institutions
Summary: Additional Note to Circular 88-1 to financial institutions of the Bank of the Republic of Haiti — an instrument published alongside circular 88-1 to financial institutions, not the circular itself. Circulars are the operative prudential rules for supervised institutions, covering matters such as capital and liquidity requirements, credit-risk and governance standards, reserve requirements and foreign-exchange rules.
Key Findings
- The BRH note clarifies the treatment of retained earnings and current-year net income in the calculation of core own funds under Circular 88-1.
- Banks must include verified retained earnings in core own funds, while cumulative net income from the current year is excluded at the reporting date.
- BRH allows a transition during the first year of implementation, from June 2021 to March 2022, so covered institutions can include decreasing shares of current cumulative net income.
- The phase-out allows 80 percent inclusion in the first quarter, 60 percent in the second, 40 percent in the third and 20 percent in the fourth.
- From June 2022, current cumulative net income is no longer admitted in regulatory own-funds calculations.
How to cite
Bank of the Republic of Haiti (BRH), 2021, Additional Note to Circular 88-1 to financial institutions, https://www.brh.ht/wp-content/uploads/Note-additionnelle-circulaire-88-1.pdf