RegAlert2016-08-17
Added · Updated
Circular dated January 11, 2016 regarding the concentration of banks’ credit portfolios
The Central Bank of Egypt reduces the maximum exposure limit for a single client without related parties from 20% to 15% of the bank's capital base, and for a client with related parties from 25% to 20%. If the total credit facilities granted to the top 50 clients exceed 50% of the bank's credit portfolio, a risk weight of 200% applies if the ratio is between 50% and 70%, and 300% if it exceeds 70%. Banks are granted a three-year deadline to comply with the exposure limits and a one-year deadline to comply with the top 50 client concentration rule.
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Mr. Chairman of the Board of Directors of the Bank
With reference to the instructions of the Central Bank of Egypt regarding the maximum limits of employment with a single client and his related parties issued on February 7, 2006, and the Central Bank of Egypt's policy towards encouraging banks to expand the customer base and work on diversification, and noting the concentration of banks' credit portfolios in a limited number of large companies, which may expose the banking sector to concentration risks, the Central Bank has decided in its meeting held on January 6, 2016 the following:
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Lineage: In force
Source: Central Bank of Egypt — original document · Summary generated with machine assistance and reviewed before publication; the authoritative text is the regulator's original document. How RegAlert works