Dear Sir, Chairman of the Board,

Greetings,

With reference to the real estate financing initiative for low, middle, and above-middle income earners at low interest rates, which achieved its objectives in previous years with notable success in advancing the real estate sector, and to continue this success, the Central Bank of Egypt has issued a new initiative whereby an amount of 50 billion Egyptian pounds is allocated for real estate financing.

This initiative targets middle-income customers, according to the detailed conditions and procedures attached, taking into account the following:

1. Real estate financing necessary for customers who meet the initiative's conditions is provided through banks or real estate finance companies at an interest rate of 10% (calculated on a declining basis) for a maximum term of 20 years.

2. Real estate refinance companies are permitted to participate in the initiative by refinancing the portfolios of finance companies that meet the initiative's conditions.

3. Compensation for the interest rate differential is based on:
   Discount Rate + 2% - 10%

4. The applied interest rate for customers cannot be changed after disbursement and throughout the loan term.

Please ensure full compliance with all credit control regulations issued by the Central Bank of Egypt, while ensuring that all conditions, guarantees, and documents are obtained that enable the bank to complete mortgage procedures before allowing the use of the financing.

Please be kind enough to notify regarding the necessity to implement the aforementioned initiative effective from its date.

Accept our highest regards.

(Attachment 1) Detailed Conditions and Procedures

1. The interest rate is applied according to the initiative and calculated on a declining basis.

2. Compensation for the interest rate differential {Discount Rate + 2% - 10%} covers the following:
   a. Commission on the highest debtor balance. b. Administrative expenses, returns, and other commissions.
   c. Valuation and mortgage expenses and any other expenses (e.g., insurance).
   Tax and stamp duties expenses are applied according to prevailing laws.

3. Conditions for Beneficiary Customers:
   a. Must be of Egyptian nationality. b. The customer is entitled to the subsidy for only one housing unit, and the customer is not entitled to the successive real estate financing initiative, regardless of any real estate loans obtained by the customer previously outside the initiative.
   c. The maximum monthly income limit is 40,000 Egyptian pounds for the individual and 50,000 Egyptian pounds for the family.

4. Conditions for the Financed Unit:
   a. Must be for permanent residence and not licensed for tourist housing. b. The maximum area of the unit is 150 square meters.
   c. The maximum value of the unit is 2.25 million pounds.
   d. The unit must be fully finished and ready for habitation. e. The value of the down payment required from the customer is at least 20% of the total value of the unit.

5. Full compliance with all credit control regulations issued by the Central Bank of Egypt, while ensuring that all conditions, guarantees, and documents are obtained that enable the completion of mortgage procedures before allowing the use of financing, subject to the following minimum requirements:
   a. Conduct a credit investigation on the customer through the Egyptian Credit Bureau and the Central Bank's Credit Collection Management Department to determine the customer's behavior with the consumer sector, in addition to confirming that the customer has not previously obtained financing under the current or previous initiatives. b. Provide a system for evaluating and analyzing the customer's creditworthiness.
   c. Obtain a first-degree real estate mortgage or a lien registration, taking into account the decision of the Minister of Housing, Utilities, and Urban Communities No. (100) of 2014.

6. Customer data is registered in the electronic system dedicated to the initiative to strictly control that the customer receives only one housing unit, so that information about the customer's receipt of credit approval from one of the banks or one of the real estate finance companies is instantly available to all parties, at which point other banks and companies are prohibited from dealing with him within the framework of the initiative.

7. Regarding the family, the spouse's data is entered, and this is updated after submitting documents proving a change in the customer's marital status through the bank or real estate finance company.

8. Upon the bank or real estate finance company's approval, the Central Bank of Egypt's Credit Collection Management Department and the Egyptian Credit Bureau must be notified, and the initiative file must be separated through the codes available on the electronic system.

9. In case the customer wishes to sell the unit or make an early settlement, the following applies:
   a. The customer repays the subsidy amount at the interest rate (value of compensation for the interest rate differential) from the date of the percentages mentioned in Attachment 2 until the date of sale/early settlement. b. The bank or real estate refinance company repays the subsidy amount to the Central Bank.
   c. No early settlement commission is applied.

10. The bank and real estate finance company have the right to apply a late payment interest rate of up to 2% added to the final lending rate for the customer, applied to the due installments. In case of approving the customer's request to restructure the debt, pricing is applied according to the initiative rate.

11. In case of customer default, the subsidy amount is repaid using the percentages stipulated in the year of default mentioned in Attachment 2, to be done immediately upon returning the unit to the financing entity, applied to the installments from the disbursement date until the return date. The Central Bank must be notified at the end of each quarterly period with the value of units whose ownership reverted due to customer default.

12. Within the framework of the initiative, Paragraph (a) of Item Sixth of the creditworthiness assessment guidelines for customers and the formation of provisions, specifically regarding the rules governing the determination of the Fair Market Value of real estate collateral and commercial premises, is amended so that the fair value of assets subject to mortgages is determined at least once every five years instead of three years.

13. Valuation for the financed units is to be used by units approved by the Ministry of Housing or the New Urban Communities Authority, or by real estate appraisers registered in the lists of accredited expert houses with the Central Bank of Egypt, taking into account what was stated in the circular letter dated June 12, 2014, regarding the fees of real estate appraisal experts, as a means to reduce the cost of real estate appraisal.

14. Confirmation of what was stated in the decision of the Board of Directors of the Central Bank of Egypt dated April 4, 2006, regarding the amendment of the creditworthiness assessment guidelines and the formation of provisions, by reducing the provision for general expenses for real estate loans for the purpose of acquiring or renewing residential units from 3% to 1%.

15. Regarding real estate finance companies, the following is observed:
    a. Signing a binding contract (protocol of dealing) between banks and real estate finance companies to apply all conditions and procedures of work under the initiative, especially regarding lending rates and conditions for customers. b. Real estate finance companies claim compensation for the interest rate differential through banks.
    c. Confirmation of the creditworthiness of real estate finance companies by the developer before refinancing through real estate refinance companies.

16. The Operations Sector of the Central Bank of Egypt is to be notified of the value of the required compensation through the first statement of each month, starting from the month following the disbursement, while separating the values related to finance companies' claims independently.

17. The Supervision and Inspection Sector is to periodically follow up to verify the extent of banks' compliance with the above and the quality of the ledger formed within its scope, and to verify the accuracy of the data entered on the system and the forms to be sent to the banks later.

(Attachment 2)

Stipulated Percentages for Calculating the Compensation Amount in the Interest Rate Differential in Case of Unit Sale or Early Settlement

Year of Repayment	20	19	18	17	16	15	14	13	12	11	10	9	8	7	6	5	4	3	2	1	100%	1
		100%	100%	2
	100%	100%	100%	3
	100%	100%	100%	100%	4
	100%	100%	100%	100%	100%	5
	90%	100%	100%	100%	100%	100%	6
80%	90%	100%	100%	100%	100%	100%	7
70%	80%	90%	100%	100%	100%	100%	100%	8
60%	70%	80%	90%	100%	100%	100%	100%	100%	9
50%	60%	70%	80%	90%	100%	100%	100%	100%	100%	10
40%	50%	60%	70%	80%	90%	100%	100%	100%	100%	100%	11
30%	40%	50%	60%	70%	80%	90%	100%	100%	100%	100%	100%	12
20%	30%	40%	50%	60%	70%	80%	90%	100%	100%	100%	100%	100%	13

			10%	20%	30%	40%	50%	60%	70%	80%	90%	100%	100%	100%	100%	100%	14
			0%	10%	20%	30%	40%	50%	60%	70%	80%	90%	100%	100%	100%	100%	100%	15
			0%	0%	10%	20%	30%	40%	50%	60%	70%	80%	90%	100%	100%	100%	100%	100%	16
	0%		0%	0%	10%	20%	30%	40%	50%	60%	70%	80%	90%	100%	100%	100%	100%	100%	17
0%	0%		0%	0%	10%	20%	30%	40%	50%	60%	70%	80%	90%	100%	100%	100%	100%	100%	18
0%	0%	0%	0%	0%	10%	20%	30%	40%	50%	60%	70%	80%	90%	100%	100%	100%	100%	100%	19
0%	0%	0%	0%	0%	0%	10%	20%	30%	40%	50%	60%	70%	80%	90%	100%	100%	100%	100%	100%	20