Palestine Monetary Authority

PALESTINE MONETARY AUTHORITY

Circular No. (14/2015)
To all lending institutions operating in Palestine

Date: Wednesday, 04 February, 2015

Subject: Borrower Guarantee for Personal Facilities

Further to Memorandum No. (2009/26) issued on 26/5/2009 regarding the regulation of the Credit Information System's operations, to best international practices concerning the disclosure of borrower data and guarantees, to the procedures taken regarding the correct declaration of facility guarantee data for the Credit Information System database (Sijili), and given the recent emergence of errors by some institutions in declaring facility guarantees, we wish to highlight and emphasize the following:

A borrower shall not act as a guarantor for their own facilities as long as they are legally bound to repay them under the loan agreement. In other words, the institution shall not declare the borrower as a guarantor for the granted facilities when reporting them in the monthly facility file or when opening a record for new facilities, as this negatively impacts data accuracy and the borrower's classification.
The incorrect disclosure by some institutions, as mentioned in the paragraph above, has resulted in inaccurate classification of some borrowers. This necessitates the Palestine Monetary Authority to take the appropriate immediate action to amend the data, which consists of deleting all guarantees where borrowers have guaranteed their own facilities and reported them to the Credit Information System.

Therefore, institution management is requested to circulate this directive to the facilities departments, information technology departments, and relevant staff, emphasizing the necessity to comply with these instructions and ensure the correct declaration of data. Otherwise, the Palestine Monetary Authority will be compelled to take appropriate legal action to preserve data accuracy and Credit Information System outputs.

Public Relations and Market Discipline Department

Palestine Monetary Authority

Ramallah - Palestine P.O. Box 452 | Tel: +970 2 2415250 | Fax: +970 2 2409922 | Fax: +970 2 2409922 | Tel: +970 2 2415250 | Ramallah - Palestine P.O. Box 452 Gaza - Palestine P.O. Box 4026 | Tel: +970 8 2825292 | Fax: +970 8 2844487 | Fax: +970 8 2844487 | Tel: +970 8 2825292 | Gaza - Palestine P.O. Box 4026 Email: info@pma.ps | Email: info@pma.ps