Fiscal Year 2026
Capacity Development Activities
Financial Supervision and Regulation
Upgrade of the Onsite Inspection Manual
With METAC’s technical assistance, the Banque d’Algérie has successfully enhanced its onsite inspection manual, marking a significant milestone in strengthening supervisory practices. The revision aimed to modernize a manual that had been in place for over 15 years and to align it with the new risk rating methodology recently developed in collaboration with METAC experts. The upgraded onsite inspection manual now provides a unified framework that harmonizes supervisory approaches across inspection teams. It equips onsite examiners with practical operational tools to conduct thorough examinations, enabling more effective and risk-sensitive onsite supervision.
Review of Draft Regulations
During September and October, METAC assisted the Banque d’Algérie in reviewing two critical draft regulations recently updated by the Banque d’Algérie team: (i) Large Exposures, and (ii) Loan Classification and Provisioning. The review focused on ensuring these regulations are aligned with the latest Basel Committee on Banking Supervision standards while being adapted to reflect the specific characteristics of the Algerian banking sector. The updated regulations are expected to enhance the supervisory framework related to credit risk management by strengthening prudential requirements around loan classification, provisioning adequacy, and credit concentration risk.
Developing Regulation on Capital Framework for Banks (December 7-11)
METAC reviewed the draft regulation recently updated by the Banque d’Algérie (BA) on the capital adequacy framework. The mission focused on revising the existing capital regulatory framework to align with the Pillar 1 Basel II/III capital standards, while taking into account the specific characteristics of the Algerian banking sector and applying proportionality principles. A revised draft regulation on the capital adequacy framework—aligned with the Basel II/III standards and appropriately tailored to the Algerian context—was produced, along with the relevant reporting templates.
Macroeconomic Frameworks
The mission team focused on further developing and operationalizing the Forecasting and Policy Analysis System (FPAS) at the Bank of Algeria (BA) during 19-30 October. The foreign sector of the BA’s Quarterly Projection Model (QPM) and real exchange rate concept were extended to effective terms. To further enrich internal communications, disseminate analytical work and gather timely feedback, the team supported BA staff in presenting the latest model extension and real-time forecasts within an interdepartmental meeting.
