Regulatory Alerts2020-01-08
A circular dated January 8, 2020 regarding the initiative to support the replacement and renovation of residence hotels, floating hotels, and tourist transportation fleets.
The Bank will offer up to 75% financing of the combined rehabilitation and renovation costs. The client will pay the remaining 25%, which can be a mix of cash and a loan, with the loan's interest rate being set according to the following scale: | Type | Interest Rate in % | |--------|---------------------------| | Cash | 0 | | Al Etihad | 2 | | Nedaa | 5 | | Waha | 7 | | Scame | + | | SADAF | 10 | The Bank will conduct a financial study to determine the feasibility of the project, as well as continuous monitoring and implementation of the allocated funds. All funded amounts must be used in accordance with tourism ministry guidelines and standards. The Bank will only use the allocated funds to finance the 75% of combined renovation and rehabilitation costs, and the client will contribute the remaining 25%. The loan's interest rate and repayment period will be determined according to the project's financial study and the client's ability to pay. The Bank will use all allocated funds within a maximum period of three years to improve the facility's services and attract more tourists. The Bank will also consider the client's operational capacity when deciding on loan repayment terms. In the case where there are unused funds after the completion of the project, they must be returned to the Bank. The client is also required to inform the Bank about any changes in their financial situation or project scope. The client agrees that the funds allocated by the Bank will be used exclusively for the purposes specified in the agreement. They also agree to cooperate with the Bank in conducting financial studies and implementing loan terms, and to provide any information requested by the Bank. Please note that this summary is provided as a concise overview of the agreement's main points, and may not include all the specific details outlined in the full text. It is recommended that you carefully review the full text of the agreement before signing.