The Bank of Mozambique issued a notice establishing an exceptional regime for the foreign exchange (FX) position limit in its prudential ratios and limits framework for credit institutions. Under the temporary rules, a credit institution must not, at the close of each day, have an overall FX position that is long by more than 2% or short by more than 20% of its own funds. It must also keep its position in each foreign currency within 1% (long) or 10% (short) of own funds. The regime applies to all credit institutions supervised by the Bank of Mozambique, including those that do not prepare financial statements under International Financial Reporting Standards, with necessary adaptations, and breaches are subject to sanctions under Mozambique’s credit institutions law. The notice enters into force on publication and the exceptional regime applies for 365 days from that effective date.
Bank of Mozambique 2025-08-01
Bank of Mozambique introduces a 365-day exceptional regime tightening banks’ FX position limits
The Bank of Mozambique has introduced a temporary regime for foreign exchange position limits within its prudential framework for credit institutions. Institutions must not exceed a long FX position of 2% or a short position of 20% of their own funds, with individual currency positions capped at 1% (long) and 10% (short). This applies to all supervised credit institutions, with non-compliance subject to sanctions under Mozambique’s credit institutions law.