Regulatory Alerts2022-11-24 | 13502Capital Adequacy Regulatory Framework for Banks Operating in Lebanon and International Financial Reporting Standard no. 9 (IFRS 9)
The Central Bank of Lebanon issued Circular Decision No. 13502 to amend the capital adequacy regulatory framework (Decision No. 6939) and IFRS 9 application rules (Decision No. 12713). The decision permits banks to exceptionally add up to 66% (in 2022) and 33% (in 2023) of losses from purchasing US dollars to settle banknotes to their own funds, while extending the gradual establishment period for certain provisions until December 2026 or 2029. It also updates the calculation of Common Equity Tier 1 capital, expected loss provisions, and systemic risk rates to reflect exceptional economic conditions and align off-balance-sheet exposures with appropriate credit conversion factors.
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