Regulatory Alerts2016-03-23
Added · Updated
Circular dated March 22, 2016 regarding clarifications on instructions for SMEs, credit portfolio concentration, and consumer loans issued January 11, 2016
The Central Bank of Egypt clarifies that credit exposure for the top 50 clients is calculated based on the client rather than the facility, with specific risk weight penalties applied if exposure exceeds 50% of the bank's portfolio. It mandates that banks exclude collateral-covered portions from the debt-to-income ratio calculation for consumer loans and allows a 50% ratio for employee loans. The circular also defines the 20% SME lending target based on direct and indirect facilities, exempts certain entities from this target, and updates the paid-up capital requirements for newly established medium-sized enterprises.