Regulatory Alerts2024-06-30
Added · Updated
Instructions for Classifying Credit Exposures and Calculating Impairment Provisions Against Them
The Central Bank of Jordan issued Instructions No. (8/ 2024) effective January 1, 2025, requiring all banks operating in Jordan to classify credit exposures into risk-acceptable, watch list, and non-performing categories based on specific delinquency thresholds and qualitative indicators. The directive mandates impairment provisions of 25%, 50%, and 100% for substandard, doubtful, and loss categories respectively, while restricting restructuring grace periods to a maximum of 18 months for restructurings and 12 months for reschedulings. It further establishes mandatory probationary periods of 12, 6, or 3 months for reclassifying exposures to better categories, contingent upon minimum payment percentages and improved credit status assessments.