MEXICO

On September 6, the Secretariat of Finance and Public Credit (SHCP in Spanish) opened, through the National Commission for Regulatory Improvement (CONAMER in Spanish), a public consultation on financial provisions regarding effective interest rates. The draft bill will be open for consultation until at least October 4, and interested parties may send their opinions through the following link. It also opened a second public consultation on financial group holding companies. The preliminary draft will be open for consultation until at least October 5, and interested parties may send their opinions through the following link.

The first draft proposes the modification of the Resolution that modifies the General Provisions applicable to Credit Institutions published on March 13, 2020 in the Official Gazette of the Federation (DOF in Spanish). Said resolution established the implementation of the effective interest method and the effective interest rate, with the purpose of allowing financial institutions to calculate the amortized cost of their loan portfolio, in order to dispense their effective interest income during the life of the loan portfolio.

However, the text under consultation determines that during 2022, financial institutions, based on their purpose of determining the amortized cost set forth in Criterion B-6 “Loan Portfolio” of the resolution to be amended, may use the contractual interest rate in the recording of interest received from their loan portfolio. This course of action must be notified to the Vice-Presidency of the National Banking and Securities Commission (CNBV in Spanish) before December 31, 2021, clarifying the reasons why the effective interest rate will not be used.

On the other hand, the second draft in consultation amends the Provisions applicable to financial group holding companies and sub-controlling companies. In the text, it indicates that the Controlling Companies will have to display on their web pages, the basic consolidated financial statements annually, belonging to a financial group with figures as of December of each year, in addition to including an external audit report.