Regulatory Alerts2020-09-22
Added · Updated
Circular dated September 21, 2020 regarding reviewing the models used in calculating expected credit losses
Banks are required to review the models used for calculating expected credit losses (ECL) to identify unseen factors and verify the methodology's integrity, as well as assess the quality and sufficiency of information systems and data used in model design. Each bank must submit a report certified by its Audit and Risk Committees to the Central Bank of Egypt within one month of the circular's date, detailing the review results, any model modifications, and the impact on the bank's credit portfolio. This requirement aims to ensure the accuracy of ECL calculations and the soundness of financial positions during crises.
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