Regulatory Alerts2024-07-01
Added · Updated
Circular dated July 1, 2024 regarding the gradual phase-out of temporary SME loan exemptions under IFRS 9
The Central Bank of Egypt has approved a gradual 18-month phase-out, concluding in December 2025, of the temporary exemption allowing small and medium-sized enterprises (SMEs) to remain out of Stage 3 classification under IFRS 9. The new framework mandates that SMEs be reclassified into Stage 3 based on escalating consecutive overdue receivables thresholds of 180, 150, and 120 days through December 2024 to December 2025, ultimately standardizing the 90-day threshold from January 2026. Additionally, the Central Bank extends until December 2025 the provision allowing SMEs to upgrade from Stage 3 to Stage 2 upon meeting quantitative and qualitative criteria, settling impaired returns, and maintaining consistent payments for 90 days.