Bank of Russia clarifies requirements for calculating NPF equity capital

The adopted changes are aimed at enhancing the financial stability of NPFs and forming their equity capital using the most liquid and highest-quality assets. The relevant Bank of Russia Ordinance was registered by the Ministry of Justice.

The document provides for increasing the requirements for assets that are included in the calculation. In particular, structured bonds can no longer be accepted. In addition, it imposes a restriction on the share of real estate property included in the calculation and regulates the procedure to include NPF liabilities under long-term leasing contracts.

Moreover, it sets a term of 10 business days for NPFs to remedy violations of minimum equity capital requirements if such violations were beyond their control.

The Bank of Russia Ordinance will come into force on 26 November 2019 except for the provision regarding the decreased share of real estate property which is to become effective 6 days after the official publication of the Ordinance.