Regulatory Alerts2024-03-04 | CBE4.5Added · Updated
CBE Regulation Book 4.5 - Foundations Of Assessing Customers Creditworthiness 5
The Central Bank of Egypt mandates that banks adopt credit risk management policies, including an approved board policy, internal rating systems, and guidelines for obligor concentration and provisioning. Banks are required to conduct detailed reviews of corporate, SME, and related-party exposures, assessing industry stability, financial health, and management quality to determine creditworthiness. The regulation establishes a ten-tier internal rating scale (from Low Risk to Loss) with corresponding minimum provisioning percentages ranging from 1% to 100%, effective from the first banking day of the fiscal year following December 31, 2005.