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Erudite AfricaCenter of Excellence
← Interest Free Banking Financing: Advanced

Write-off and recovery

Module 05 / 7 · 55 min

Write off only on evidence, keep the register, and keep recovering after write-off, including reinstatement, waivers, guarantees and debt transfers that the SAC has ruled on.

In this module you will learn to

  • Apply the evidence test for write-off: absence of property, insolvency, bankruptcy, recovery costing more than realization, defective documents, a court judgment against the bank, or the statutory period having passed
  • Process a write-off case, record the accounting entries and keep the register book
  • Follow up and recover written-off financings, including through litigation, and reinstate cases that recover
  • Apply the conditions for waiving profit and penalty, releasing personal guarantees and handling new requests from these customers
  • Explain why selling long-outstanding cases to other institutions needs an SAC ruling on how a debt may be transferred

Built on

  • Erudite Africa training outline: Interest Free Banking Financing, Level 3 Advanced (October 2026)
  • A typical Ethiopian bank's IFB financing business procedure (May 2025), unnamed: approval system, grading, follow-up, problem finance, write-off, portfolio management and exceptions
  • NBE Bank Corporate Governance Directive No. SBB/91/2024 (influential shareholder at 2%) and Risk Based Capital Adequacy Requirement for Banks Directive No. SBB/95/2025, issued under Banking Business Proclamation No. 1360/2025
  • NBE directives on interest free banking, large exposures, related parties, and asset classification and provisioning, in their current versions
  • AAOIFI Sharia'h Standards, including Sharia'h Standard No. 8 (Murabaha); the host bank's Sharia'h Advisory Committee rulings take precedence
  • IFRS 9 Financial Instruments: expected credit loss staging

Examples and companies are fictional. Bank practices are shown as typical Ethiopian practice, not as any one bank's policy. Always apply your own institution's approved policy and the current NBE directives.