Regulatory Alerts2020-01-08
Added · Updated
Circular dated January 8, 2020 regarding the initiative for irregular legal persons (creditworthiness categories 9 and 10)
The Central Bank of Egypt modifies its December 12, 2019 initiative for irregular legal persons with doubtful or bad debts (creditworthiness categories 9 and 10) and balances under 10 million EGP. Clients who pay 50% or more of their debt by December 31, 2020, through cash or in-kind settlement, will be removed from negative lists, have trading bans lifted, have pending lawsuits withdrawn, and have guarantees released. The 50% payment must be split into at least 20% by June 30, 2020, and the remainder by the end of December 2020. Banks are instructed to avoid litigation unless fraud is proven, conduct thorough credit studies, and accept promissory notes instead of cheques as guarantees.