Regulatory Alerts2011-01-01
Circular No. 32: Development of Borrower Classification System
The Palestine Monetary Authority issued Circular No. 32 (2011) to revise the borrower classification system in alignment with the local banking environment. The updated framework introduces a 30-day grace period for payment delays to accommodate monthly salary transfer patterns, directly links guarantor risk ratings to the performance of guaranteed facilities, and reduces risk weights for credit card holders who fully utilize limits while maintaining timely payments. These amendments aim to strengthen credit risk mitigation tools and preserve the overall quality of the banking portfolio.
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