Circular dated December 30, 2020 regarding the Credit Risk Guarantee Company’s guarantee account for calculating the maximum limits for the bank’s investments with a single client and related parties

Cairo on 2020/12/30

Dear Mr. / Chairman of the Board of Directors

↓ 4.

Bank

Greetings,

With reference to the circular letter issued on September 23, 1996, which defined the bank's exposures to a single client, and subsequent circular letters on the same subject, specifically the one issued on March 5, 2006, containing instructions regarding the maximum limits for the bank's exposures to a single client and related parties, and its amendments dated January 11, 2016, and October 13, 2019.

In the context of monitoring the portfolio of facilities guaranteed by the Credit Risk Guarantee Company, and with the Central Bank of Egypt keen to achieve maximum benefit from such guarantees - especially since their guarantees have been relied upon to a greater extent during the current year in light of the spread of the COVID-19 virus and its subsequent repercussions -

The Board of Directors of the Central Bank of Egypt, in its meeting held on December 13, 2020, has decided the following:

Regarding the treatment of guarantees issued by the Credit Risk Guarantee Company when calculating the maximum limit for the bank's exposures to a single client and the client and related parties:

1. Excluding the portion covered by the Credit Risk Guarantee Company's guarantee from the bank's exposures to a single client or the client and related parties.

2. Adding the balances of capital adequacy ratios excluded according to the previous item to the bank's exposures to the Credit Risk Guarantee Company, provided that those covered by commitments of the Central Bank of Egypt are excluded from them.

Please be kind enough to alert regarding taking the necessary action in this regard.

Yours faithfully,

Tarek Amer