Regulatory Alerts2021-01-06
Added · Updated
Central Bank of Jordan Circular on Extending Interest Rate Freeze
The Central Bank of Jordan extends the prohibition on banks raising interest rates until the central bank changes interest rates in the future. This directive applies to all banks operating in the Kingdom, including those that adopted the interbank lending rate of 1.9% in May 2020. The extension replaces the previous deadline of the end of 2020 established in Circular No. 4872/1/27.
In the Name of Allah, the Most Gracious, the Most Merciful
[Logo of the Central Bank of Jordan]
Number: 27/1/479 Date: 22/5/1442 AH Corresponding to: 6/1/2021 AD
Circular to all banks operating in the Kingdom
Greetings,
Further to our circular No. (4872/1/27) dated 27/4/2020, and regarding Item (Second), which stipulated that banks should not raise interest rates for customers when the subsequent adjustment periods mature after the date of the interest rate reduction, until the end of the year 2020. Please be informed that it has been decided to extend the application of the provisions of this item until the Central Bank changes interest rates in the future.
We emphasize that the above applies to all banks, including those that adopted the interbank lending rate (1.9%) at the time of the interest rate reduction in early May 2020, in order to enable them to reduce interest rates by a total of (1.5%).
Yours faithfully,
The Governor Dr. Ziad Frieze