Regulatory Alerts2012-05-08
Postponing the deduction of additional impairment losses calculated for owning shares in non-financial companies whose value exceeds 40% of the company’s issued capital.
Esteemed Chairman of the Board, I would like to inform you that the Banking Supervisory Committee has approved a resolution for the Egyptian Central Bank on September 8, 2009, which includes the following: 1) A regulation is applied to the Central Bank's additional capital losses, which started from July 2007, by deducting the percentage of up to 40% from the total capital source of the respective banks on a quarterly basis until the financial crisis ends. 2) In case the bank holding these additional capital losses exceeds 40% of the total capital source for one year since July 2012, their income statement will be adjusted by deducting this amount from the bank's total net capital and/or operating expenses. This method will only apply to new acquisitions made by the bank after its financial statements are issued on June 30, 2012. The above applies with due consideration of the remarks given in Circular No. 108 dated May 5, 2009.