Systemically important institutions shall draw up an emergency recovery plan which can be implemented immediately and which ensures that, in the event of a persistent breach of prudential standards relating to solvency and liquidity, the continuity of operations is guaranteed without the implementation of a special restructuring procedure defined by CEMAC Regulation 02/14/CEMAC/UMAC/COBAC/CM relating to the treatment of credit institutions in difficulty.
The plan includes all the measures enabling the institution to re-establish its compliance with regulations in the very short term, within a period not exceeding three months, and to guarantee the continuity of its operations.
The establishment must indicate in particular in this plan:
– The recovery strategy in the event of failure and any obstacles to the implementation of this plan and the solutions envisaged;
– The measures planned by the shareholders to recapitalize the institution and rapidly rebuild its equity capital;
– The strategy to be put in place to obtain new sources of financing as quickly as possible;
– The organizational reforms envisaged to rapidly manage the risks
– Tools to anticipate or facilitate the rapid disposal of assets or business lines;
– The new human and technical resources to be deployed and their operational;
– Details of the implementation of the emergency financing plan indicated;
– Liquidation measures if the plan fails.
The emergency recovery plan is adopted by the governing body for a period of 12 months. It is updated at least once a year.
The emergency recovery plan is sent for approval to the General Secretariat of the Banking Commission, no later than 1st March of each of each year.
The General Secretariat of the Banking Commission may request that specific measures be included in the emergency plan, in particular a change in the organizational structure, the temporary suspension of certain activities or the activities or the non-distribution of dividends.
The General Secretariat of the Banking Commission has one month to reach a decision. If the plan is rejected, the institution must produce a new plan within one month.
In the event of a breach of the regulations, the Secretary General of the Banking Commission asks the institution to implement the emergency recovery plan without delay, in particular with regard to the elements relating to the infringement observed.
When the establishment is called upon to implement its emergency recovery plan, it shall send the Secretariat General of the Banking Commission, every month, a detailed report on the implementation of this plan.
In the event of serious and persistent difficulties, or in the event of failure of the recovery plan, the Secretary General of COBAC shall inform the monetary authority of the seriousness of the institution’s situation, of the failure of the implementation of the emergency recovery plan and asks it to trigger the special restructuring special restructuring procedure.