07.01.2016, 00:49
Introducing Differentiated Approach еo Calculating Financial Ratios
OREANDA-NEWS. The Bank of Russia has worked out Ordinance No. 3916-U, dated 28 December 2015, 'On the Numerical Values and the Procedure for Calculating Financial Ratios of Credit Consumer Cooperatives' (CCCs)
The key novation of the Bank of Russia Ordinance is a differentiated approach to calculating financial ratios of CCCs, including second-tier cooperatives. The ratios are calculated based on the number of members (shareholders) and the term of activity of the credit consumer cooperative. For example, the reserve ratio shall be lower for recently established CCCs and cooperatives with few shareholders.
The ratios of the maximum financial borrowing and lending per member are also more favourable for newly established CCCs. The previous rules envisaged similar equity capital ratio for all credit consumer cooperatives. The new Ordinance eases the requirements for the unit fund (equity capital) from 8% to 6%. There is also a new liquidity ratio which is to be introduces within the transition period until 2018.
Previously, these ratios were calculated in compliance with Order of the Ministry of Finance of the Russian Federation No. 51n, effective in compliance with the Law 'On Credit Cooperation' (No. 190-FZ, dated 18 July 2009). Following the amendments to the law (No.210-FZ, dated 29 June 2015), starting 29 December 2015, the Bank of Russia shall be entitled to set the values of financial ratios independently, the effective ratios in this case shall be deemed invalid.
The key novation of the Bank of Russia Ordinance is a differentiated approach to calculating financial ratios of CCCs, including second-tier cooperatives. The ratios are calculated based on the number of members (shareholders) and the term of activity of the credit consumer cooperative. For example, the reserve ratio shall be lower for recently established CCCs and cooperatives with few shareholders.
The ratios of the maximum financial borrowing and lending per member are also more favourable for newly established CCCs. The previous rules envisaged similar equity capital ratio for all credit consumer cooperatives. The new Ordinance eases the requirements for the unit fund (equity capital) from 8% to 6%. There is also a new liquidity ratio which is to be introduces within the transition period until 2018.
Previously, these ratios were calculated in compliance with Order of the Ministry of Finance of the Russian Federation No. 51n, effective in compliance with the Law 'On Credit Cooperation' (No. 190-FZ, dated 18 July 2009). Following the amendments to the law (No.210-FZ, dated 29 June 2015), starting 29 December 2015, the Bank of Russia shall be entitled to set the values of financial ratios independently, the effective ratios in this case shall be deemed invalid.
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