This policy entails that commercial banks are not allowed to have a negative net foreign assets position. Any negative position is subject to a penalty equal to the amount of the negative position multiplied by the Central Bank's pledging rate.
The rationale for this instrument is to prevent commercial banks to accumulate net foreign debt, which might ultimately contribute to a foreign exchange crisis.
Policy in foreign positision
Commercial banks are required to submit their weekly B-9 reporting form stating their positions on Friday on each Monday. This reporting requirement is based on the “Aanwijzing no. 5 van de Bekendmaking inzake het Deviezenverkeer AW/2009-1” and section 14 of the National Ordinance on the Supervision of Banking and Credit Institutions (P.B. 1994, no. 4).
Under this policy, it is not allowed to have a negative Net Foreign Assets position, but the Net Foreign Assets position is not bound to a maximum. When a commercial bank incidentally has a negative Net Foreign Assets position, the Bank will charge an administration fee equal to the amount of the negative position multiplied by the Bank's pledging rate (or "beleningsrente") and again by (7/360)11. This formula to calculate the fee is subject to change by the Bank without prior notice. The fee is calculated weekly and billed on a monthly basis.
The Bank will issue a warning in case the B-9 reporting is submitted after Monday more than once. If late reporting continues during the reporting year, the Bank will immediately impose a penalty of NAf. 1,000 for each day of late reporting (please refer to the national decree of September 23, 1994 (P.B. 1994, no. 110).
CENTRALE BANK VAN CURAÇAO EN SINT MAARTEN