SPECIAL ASPECTS OF IFRS 9 APPLICATION BY CREDIT GUARANTEE FUNDS IN DEVELOPING COUNTRIES

Authors : Malik-aidar Abakirov, Syrgak Abakirov, Emil Avazov, Erkin Baialieva, Mahabat Kazieva, Reina Kurmankojoeva, Elmira Mamytova

Pages : 46-60

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Publication Date : 2019-08-01

Article Type : Research

Abstract :The article is devoted to the experience of guarantee funds operating in developing countries in implementation and application of IFRS 9 (as in the case of OJSC "Guarantee Fund” in the Kyrgyz Republic), as well as the methods and approaches for assessment of the guarantee risks and loan/guarantee losses under IFRS 9 standard. The key points and important aspects of IFRS 9 are outlined and, in particular, the results of the standard implementation by OJSC "Guarantee Fund” are presented. The article explains the models to estimate the probability of default by borrowers and counterparties of guarantee funds and approaches to calculate expected credit losses on the guarantee portfolio and financial assets, as well as describes approaches developed by OJSC "Guarantee Fund” to assess the probability of default by commercial banks and establish their internal ratings.
Keywords : IFRS 9, financial instrument, expected credit losses, model of expected credit/guarantee losses, probability of default