Regulatory Alerts2018-01-03
Added · Updated
Circular dated January 3, 2018 regarding the recognition of the credit risk company’s guarantee
The Central Bank of Egypt mandates that banks recognize guarantees issued by the Credit Guarantee Company (CGC) for capital adequacy calculations, assigning a 20% risk weight to the guaranteed portion and a 0% risk weight to the portion covered by the Central Bank's guarantee letter. Banks must also include CGC guarantees when calculating provisions for credit impairment, excluding the guaranteed amount from the customer's facility balance. These instructions apply to banks operating in Egypt starting from the end of December 2017.