Decree No. 187 / 2012 Coll.
Decree amending Decree No. 123 / 2007 Coll., on the rules of prudent business of banks, savings and credit cooperatives and securities dealers, as amended
Valid
Order
Effective from 01.07.2012
Text versions:
01.07.2012
12.06.2012
187
DECLARATION
of 28 May 2012
amending Decree No. 123 / 2007 Coll., on the prudential business rules of banks, savings and credit cooperatives and securities dealers, as amended
The Czech National Bank, pursuant to § 8b (5), § 15 and § 24 (1) of Act No. 21 / 1992 Coll., on Banks, as amended by Act No. 120 / 2007 Coll., pursuant to § 7a (5), § 11 (3) and § 27 (1) of Act No. 87 / 1995 Coll., on savings and credit cooperatives and certain measures related thereto, and on the addition of Act No. 586 / 1992 Coll., on Income Taxes, as amended, as amended by Act No. 120 / 2007 Coll., and pursuant to § 9c (d) and § 199 (2) of Act No. 256 / 2004 Coll., on Capital Market Enterprise, as amended by Act No. 120 / 2007 Coll., and Act No. 230 / 2008 Coll.:
Decree No. 123 / 2007 Coll., on the rules of prudent business of banks, savings and credit cooperatives and securities dealers, as amended by Decree No. 282 / 2008 Coll., Decree No. 380 / 2010 Coll. and Decree No. 89 / 2011 Coll., is amended as follows:
1. in Paragraph 182 (2) (d), "75" is replaced by "50."
2. In Section 201, the following paragraph 3 is added:
"(3) A bank or cooperative reserve may take into account collateral when determining the amount of impairment loss if:
(a) the collateral and associated policies and procedures used to reduce credit risk establish claims which are legally effective and enforceable in all relevant legal systems;
(b) adequately manage the risks to which it is or may be exposed in relation to the collateral it takes into account;
(c) notwithstanding the collateral taken into account, it continues to carry out a full assessment of the credit risk associated with the claim;
(d) the collateral shall, within a reasonable period of time, be negotiable at least at the value at which it is taken into account in the calculation of the impairment loss;
(e) in the event of default of the debtor, or, where applicable, the person who took over the collateral into custody, for storage, or for administration, in particular where a decision on the bankruptcy of one of those persons has been taken, or where another specified credit event has occurred, is entitled to satisfy his claim within a reasonable period of time from the operative event;
(f) the degree of correlation between the value of collateral and the credit quality of the obligor is insignificant;
(g) the personal collateral provider is sufficiently trusted to ensure that the level of credit risk reduction achieved corresponds to the level taken into account in the calculation of the impairment loss; and
(h) has and applies clear criteria for assessing the eligibility of personal collateral providers. ';
3. The following Sections 215a and 215b are inserted after Section 215:
Information on intra-group transactions
(1) The debtor informs the Czech National Bank, without undue delay, of the negotiation of a transaction with a value exceeding 1% of the balance sheet total of the obliged entity, which means that the credit risk to which the person is exposed is transferred to the obliged entity,
(a) which is controlled by a compulsory person;
(b) controlled by the same person as the obliged person; or
(c) which controls the required person.
(2) Paragraph 1 applies in particular to:
(a) the acquisition of an asset which is not traded on an active market;
(b) acquisition of a portfolio of claims not traded on an active market;
(c) the acquisition of the securitised exposure;
(d) the provision of syndicate credit, sub-participation or similar business; or
(e) the provision of a guarantee or a credit derivative.
(3) Where credit risk is transferred to the obligor as a result of multiple related transactions, these transactions shall be treated as one transaction for the purpose of assessing a value exceeding 1% of the balance sheet total of the obligor.
Information on structural changes
The obliged person shall inform the Czech National Bank without undue delay of:
(a) the purchase of the undertaking or part thereof by a person;
1. which is controlled by a mandatory person,
2. controlled by the same person as the mandatory person; or
3. which controls the obliged person,
(b) the negotiation of a capital investment in a person controlled by the same person as a obliged person where the capital investment exceeds 10% of the capital of that person; and
(c) a decision to participate in the transformation of a company or cooperative. "
4. In Annex 1, Part 1, point B The title also reads: "System for the execution of transactions'.
5. In Annex No 1, Part 1, point (b) is replaced by the following: B. at the end of the text in point I.3, the words "participating in credit risk, structured products and similar transactions' shall be added.
6. In Annex No 1, Part 1, point B.I.5:
"5. In the framework of the trading venue, depending on the type of product and type of counterparty, they shall be assessed over time taking into account the maturity of the exposure, in particular:
(a) the financial and economic situation of the counterparty;
(b) the purpose of the transaction;
(c) sources of repayment, including the ratio of the exposure value to the free cash flows of the counterparty (loan to income);
(d) the quality and adequacy of the collateral;
(e) the situation in the counterparty's economic sector; If the exposure is secured by equity, the bank or the cooperative shall also assess the exposure value ratio to the collateral (loan to value),
(f) macroeconomic conditions in the country of the counterparty's registered office, including phases of the business cycle;
(g) the conditions under which the trade is to take place;
(h) applicable law, including foreign law, where applicable; and
(i) in the case of the financing of an asset, also the ratio of the own resources used by the counterparty to the value of that asset. ';
7. In Annex No 1, Part 1, point (b) is replaced by the following: B. the following shall be added at the end of the text of point I.6: ", when assessing a counterparty, it cannot be considered as a substitute for the repayment of an exposure or be taken into account in the internal credit assessment (internal rating) of the counterparty '.
8. In Annex No 1, Part 1, point B., points III.1 and III.2, the words "Compulsory person 'are replaced by" Bank or cooperative reserve'.
9. In Annex No 1, Part 1, point (b) is replaced by the following: B. Point III.1 of the Introductory Part of the provision shall be inserted after the word "Board of Directors" or, where appropriate, by the committee to which the Board of Directors has delegated that competence. "
Efficacy
This Decree shall take effect on 1 July 2012.
Governor:
Ing. Singer, Ph.D., v. r.
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Regulation Information
| Citation | Decree No. 187 / 2012 Coll., amending Decree No. 123 / 2007 Coll., on prudential business rules for banks, savings and credit cooperatives and securities dealers, as amended |
|---|---|
| Regulation Type | Order |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 12.06.2012 |
|---|---|
| Effective from | 01.07.2012 |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
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