Scribd
Upload
1K views9 pages

BRPD Circular 15 Presentation

BRPD Circular No. 15, issued by Bangladesh Bank, updates regulations on Non-Performing Loans (NPL) and provisioning policies, implementing IFRS 9 standards by 2027. It categorizes loans and establishes classification criteria, along with specific provisioning requirements based on loan status. The circular, effective from April 1, 2025, mandates quarterly reporting and compliance, superseding previous regulations and applicable to all scheduled banks, including Islamic banks.

Uploaded by

daniel.s.a.gaotek
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
1K views9 pages

BRPD Circular 15 Presentation

BRPD Circular No. 15, issued by Bangladesh Bank, updates regulations on Non-Performing Loans (NPL) and provisioning policies, implementing IFRS 9 standards by 2027. It categorizes loans and establishes classification criteria, along with specific provisioning requirements based on loan status. The circular, effective from April 1, 2025, mandates quarterly reporting and compliance, superseding previous regulations and applicable to all scheduled banks, including Islamic banks.

Uploaded by

daniel.s.a.gaotek
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

BRPD Circular No.

15: Loan
Classification and Provisioning
Bangladesh Bank | November 27,
2024
Introduction
• • Issued by Bangladesh Bank to all scheduled
banks in Bangladesh.
• • Aims to update regulations on Non-
Performing Loans (NPL) and provisioning
policies.
• • Implements IFRS 9 standards by 2027 for
Expected Credit Loss (ECL) methodology.
Categories of Loans
• • Continuous Loan: E.g., Cash Credit,
Overdraft.
• • Demand Loan: E.g., Post Import Financing,
Payment against Documents.
• • Fixed Term Loan: Specific time and
repayment schedule.
• • Short-term Agricultural Credit: Repayable
within 12 months.
Loan Classification (CL)
• • Classified into: Standard-0, Standard-1,
Standard-2, SMA, SS, DF, and B/L.
• • Classification based on objective criteria
(past due/overdue periods) and qualitative
judgment.
• • NPL includes Sub-Standard (SS), Doubtful
(DF), and Bad/Loss (B/L).
Provisioning Requirements
• • General Provision:
• - Standard: 1%
• - SMA: 5%
• • Specific Provision:
• - SS: 20%
• - DF: 50%
• - B/L: 100%
Eligible Collateral
• • Types:
• - Deposits, government bonds, gold, land,
marketable commodities.
• • Requirements:
• - Valuation by professional assessors.
• - Periodic revaluations.
Reporting and Compliance
• • Quarterly classification activities.
• • Accurate and timely submission of CL-1
forms.
• • Penalties for non-compliance.
Implementation and Applicability
• • Supersedes previous circulars (e.g., BRPD
Circular No. 14/2012).
• • Islamic banks must adhere to these policies.
• • Effective from April 1, 2025.
General Instructions & Reporting
• • Loan classification conducted quarterly.
• • Periodic revaluations for movable (1 year)
and immovable (3 years) collateral.
• • Documentation for classification decisions
must be signed and maintained.
• • Use existing forms CL-1 to CL-5 for
classification and reporting:
• - CL-1: Summary of classifications.
• - CL-2 to CL-5: For specific loan categories.

You might also like