Regulatory Alerts2004-01-19
Circular Re. Loan Classification, Provisioning and Credit Review
The Saudi Arabian Monetary Authority issued a circular mandating that Saudi banks implement a new loan classification, provisioning, and credit review system effective January 1, 2004. The regulation requires banks to maintain general provisions of 1% for Standard and Special Mention loans while enforcing automatic provisioning for non-performing loans based on days past due. Banks must submit quarterly reports on loan portfolios, provisions, and any exceptions to these rules by the 15th of the month following each quarter.
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