Central Bank of Lebanon Circular No. 542 amending Decision No. 12713 regarding IFRS 9

Circular No. 542

For Banks and Financial Institutions

Regarding the amendment of a copy of the Decision No. 13188 dated 3/2/2020 concerning the amendment of a copy of the Basic Decision No. 12713 dated 7/11/2017 (Implementation of International Financial Reporting Standard No. 9 (IFRS 9)) attached to Basic Circular No. 143.

Beirut, on 3 February 2020

Governor of the Central Bank of Lebanon

Riad T. Salamieh

Decision No. 13188

Amending Basic Decision No. 12713 dated 7/11/2017

The Governor of the Central Bank of Lebanon,

Pursuant to the Monetary and Loan Law, particularly Articles 17, 70, and 182 thereof,

Pursuant to International Financial Reporting Standard No. 9 (IFRS 9),

Pursuant to Basic Decision No. 12713 dated 7/11/2017 and its amendments regarding the implementation of International Financial Reporting Standard No. 9 (IFRS 9),

Pursuant to the powers vested in the Governor to ensure the continuity of the public service based on the principle of continuity of the public service,

Decides as follows:

Article One: The following paragraph is added to Article 6 of Basic Decision No. 12713 dated 7/11/2017:

"The expected credit loss ratios on investment portfolios at the Central Bank of Lebanon in Lebanese Lira and foreign currencies, including certificates of deposit and investments in Lebanese Treasury bonds in Lebanese Lira and foreign currencies, must exceed the expected credit losses calculated systematically mentioned in Appendix No. 6 attached to Basic Decision No. 6939 dated 25/3/1998 concerning the regulatory framework for the capital adequacy of banks operating in Lebanon, and this for the years 2019 and 2020."

Article Two: This Decision shall enter into force upon its issuance.

Article Three: This Decision shall be published in the Official Gazette.

Beirut, on 3 February 2020

Governor of the Central Bank of Lebanon

Riad T. Salamieh