BANK 4.3.6 Restructuring, refinancing and re-provisioning of credits

(1) A credit is a restructured credit if it has been re-aged, extended, deferred, renewed, rewritten or placed in a workout program. Unless there is good reason to do so, a restructured credit can never be classified as performing.
(2) A restructured credit may be reclassified to a more favourable category, but only by 1 rating up from its category before the restructure. The credit may be reclassified 1 further category up after 180 days of satisfactory performance under the terms of the new contract.
(3) The refinancing of a special mention or impaired credit must not be used to reclassify the credit to a more favourable category.

Note A banking business firm must not restructure, refinance or reclassify assets with a view to circumventing the requirements on provisioning — see rule 4.7.5.
(4) The Regulatory Authority may require a special mention credit to be managed individually, and may set a higher level of provision for the credit, if the authority is of the view that market circumstances or any other industry-related concerns require such action.

Note For the provisioning of special mention credits — see rule 4.7.3.
Amended by QFCRA RM/2015-1 (as from 1st July 2015).