Circular Letter dated January 11, 2017 amending the conditions for listing supportive loans (deposits) in accordance with the instructions of the capital adequacy standard

Cairo On January 11, 2017

Mr. / Chairman of the Board of Directors of Bank: .......

Greetings,

I would like to refer to the instructions issued by the Central Bank of Egypt on December 24, 2012, regarding the minimum capital adequacy standard under the implementation of Basel agreements, which included the components of the second tier of the capital base, including supportive loans (deposits).

Given that international institutions and multilateral development banks, according to the definition provided in paragraphs 2/1/2/3 and 3/1/2/3 of the aforementioned instructions, have expressed the desire to grant supportive loans to Egyptian banks, thereby allowing these institutions to enter the Egyptian market and inject foreign currency resources.

Therefore, the Board of Directors of the Central Bank of Egypt, in its meeting held on December 28, 2016, decided to amend paragraph 6/2/3/2 of the instructions issued to banks on December 24, 2012, regarding the minimum capital adequacy standard under the implementation of Basel agreements, concerning the special conditions for supportive loans (deposits), to read as follows:

"In the case of obtaining a supportive loan (deposit), whether provided by shareholders, the Central Bank of Egypt, or one of the international institutions or multilateral development banks, it must meet the conditions for listing in the second tier at its current value, with the emphasis that the supportive loan (deposit) must be unconditional, i.e., not earmarked or offset against specific assets. Supportive loans (deposits) granted by those entities shall be subject to the same treatment applied to supportive loans (deposits) provided by the Central Bank of Egypt."

Please accept the highest assurances of respect.

Gamal Naguib