Credit risk coverage in financial institutions

Royal Decree 1178/2020, of December 29, introduces modifications to articles 8 and 9 of the Corporate Tax Regulations, approved by Royal Decree 634/2015, of July 10, referring to credit risk coverage in financial institutions.

On January 1, 2018, Circular 4/2017 of November 27, issued by the Bank of Spain, came into force. Its objective was to adapt the accounting regime of Spanish credit institutions to the changes in the European accounting system resulting from the adoption of two new International Financial Reporting Standards (IFRS). The new Circular makes it necessary to adapt article 9 of the Regulation, relating to credit risk coverage, to the new accounting terms used in said Circular, also modifying article 8 of said Regulation in the reference it contains to a section of said article 9.