Regulatory Alerts2011-01-01
General Authority for Financial Supervision Decision No. 45 of 2011 Concerning Rules for Calculating the Maximum Liabilities-to-Equity Ratio for Financial Leasing Companies
The General Authority for Financial Supervision issued Decision No. 45 of 2011 to amend the regulatory framework governing the maximum liabilities-to-equity ratio for financial leasing companies. The decision replaces prior provisions by authorizing leasing firms to structure operations through tripartite loan agreements with banks and financial lessees, restricting the firm's involvement to rent collection and collateral agency. Consequently, the financial lessee bears exclusive repayment liability to the lending bank, completely removing any recourse against the leasing company.
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