Parliament approves legislation to require risk committees be set up and chaired by independent directors
From 2013, banks in Belarus will be required to set up risk management committees in order to identify any existing and future risk to the Belarusian banking sector.
The regulation on risk management in banks, non-bank credit and financial institutions, banking groups, and holding companies was approved by Resolution No. 550 of the National Bank of Belarus on Monday and will come into force on 22 January 2013.
In accordance with the new legislation a bank’s Board of Directors must establish a risk management committee chaired by an independent director. Each committee will then be in charge of conducting in-house compliance monitoring and establishing an efficient risk management system within their banks.
Committees will also be expected to report regularly to boards on levels of risk at banks, and will submit recommendations on the risk surrounding current and future activities.
The document defines the risk management process and establishes requirements for banks on the identification, monitoring, control and restriction of the risks and reporting on them.
Belarus’s economy was badly affected after the financial crash in 2007, however, GDP growth has since returned to the 5%+ levels seen at the beginning of the last decade.