The Central Bank will not extend some easing for credit institutions in 2024
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The Central Bank decided not to extend some easing for credit institutions (CIs), which expire in 2023. We are talking, among other things, about relaxations in terms of compliance with the short-term liquidity standard (SLR), as well as permission to take into account profits in capital when repurchasing own Eurobonds by the end of 2023 without their formal cancellation.
According to decision The Central Bank, the following relaxations will cease to operate in 2024:
- Failure to take measures against systemically important institutions in case of violation of the net stable funding standard (NSSF);
- Relaxations under the terms of the Tax Code;
- Non-application of deductions from capital, increased risk coefficients and reserves for transactions to repurchase shares from non-residents. We are talking about non-residents who decided to sell their Russian business;
- A requirement for settlement depositories and non-bank credit institutions to include their own blocked assets in the calculation of capital adequacy standards with a 100% premium, as well as requirements to exclude client blocked assets from the calculation of standards;
- Permission to take into account profits in capital when repurchasing own Eurobonds until the end of 2023 without canceling them;
- Failure to take measures for concealment of information by a corporation about the conduct of internal procedures for assessing capital adequacy (ICAAP) for 2022;
- Extension of deadlines for the formation of reserves for loans and contingent credit obligations (CLOs) for small and medium-sized businesses, as well as for individuals with payments overdue by less than 90 days.
- Recommendation on restructuring loans of borrowers who cannot fulfill their obligations.
“At the same time, to facilitate the transition of credit institutions to compliance with the standard, irrevocable lines of credit (ICL) will be opened for them,” the regulator noted, speaking about the abolition of relaxations under the terms of the ICL. According to the Central Bank, the requirement to comply with the NKL, taking into account the BCL, will apply from March 1, 2024. “Until this point, banks are recommended to maintain the actual values of the standard not lower than those observed in the third quarter of 2023, since this is planned to be taken into account when the BCL limit is first established in order to eliminate incentives to understate the actual values of the BCL,” the Central Bank added.
The Central Bank’s decision also involves extending the right of credit institutions not to disclose “sanction risk-sensitive” information until the end of 2024. The regulator classified as “sensitive” information about “the ownership structure, members of management bodies, significant conditions of the reorganization, part of the information about significant facts affecting the financial and economic activities of the CO, reorganized in the form of merger, accession and transformation.”
On the results of the activities of Russian banks based on the results of three quarters – in the material “Kommersant” “Banks consolidated minus”.
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