On Nov. 29, RUS CB issued losses reserves for credit institutions rules.
RUS CB published ord 6879-U on the procedure for the formation by non-bank credit institutions - central counterparties, credit institutions - settlement depositories of reserves for possible losses on individual claims in the context of restrictive measures.
Summary
The new ordinance establishes a procedure for the formation of reserves for possible losses by central counterparties and settlement depositories under sanctions.
Non-bank credit institutions, central counterparties, settlement depositories can use a special procedure for forming reserves for losses related to certain foreign institutions.
These foreign institutions include those authorized to: handle accounting and transfer of rights to securities, perform broker-like activities and/or act as foreign banks.
Reserves may cover money and precious metals credited to accounts in foreign financial institutions and institutions restricted under sanctions for certain transactions.
Procedure for formation of reserves for possible losses using banking risk management methods and quantitative risk assessment models, will not apply to blocked claims.
Central counterparties and settlement depositories determine the following minimum amount of the reserve to be formed for each blocked claim: 60% of reserve calculation base until Dec. 31, 2025, 80% until Dec. 31, 2026 and 100% until Dec. 31, 2027.
Effectiveness
The ord enters into force Jan. 1, 2025 and main provisions are valid until Jan. 1, 2028.
