Asset Ratio Repealed!
The Banking Regulatory and Supervisory Authority ("BRSA"), with its decision No. 9271 dated November 24, 2020, decided to terminate asset ratio calculations as of December 31, 2020.
What Does the Decision Say?
Due to the adverse effects of the COVID-19 pandemic on global markets, the BRSA decided to implement asset ratio calculations as of May 2020 to ensure the effective use of bank resources. Over time the BRSA softened the requirements in respect of the calculation of the asset ratio by reference to the normalization process.
As part of the normalization process, the BRSA now decided to repeal asset ratio obligation as of December 31, 2020.
The BRSA aims to control loan growth as another step towards normalization by terminating asset ratio obligation.
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