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
- This note adds a capital charge rather than delaying one. Subject financial institutions must apply a risk weighting factor of 150 percent to any loan granted from a drawdown on a credit line.
- A 150 percent weight is above the standard weight for ordinary corporate exposure, so the BRH is treating credit-line drawdowns as a higher-risk funding route and pricing that into capital requirements.
- The note states that it forms an integral part of Circular 88-1, which means it is not guidance but an amendment to the operative prudential rule.
- The implementation window is three days: signed on 5 August 2022 and in force from 8 August 2022, unusually short for a change in risk weighting.
- It is addressed to subject financial institutions generally and signed by the Governor.
Full Document Text
Extracted text from the original document for search indexing.
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Banque de la République d'Haïti
NOTE ADDITIONNELLE #2
Circulaire 88-1
Aux Institutions Financières Assujetties
Dans le cadre de l’application de la Circulaire 88-1, la Banque de la République d'Haïti (BRH)
demande aux institutions financières assujetties d’appliquer un facteur de pondération de risque
de 150% à tout prêt octroyé à partir de tirage sur lignes de crédit.
Cette note additionnelle fait partie intégrante de la Circulaire 88-1 et entre en vigueur à compter
du 8 août 2022.
Port-au-Prince, le 5 août 2022
&
can Baden] Duboïs
ouve
How to cite
Banque de la République d'Haïti (BRH), 2022, Additional Note to Circular 88-1 to financial institutions, https://www.brh.ht/wp-content/uploads/Note-additionnelle-No2-Circulaire-88-1.pdf