Regulatory Alerts2018-06-06
Added · Updated
Instructions for Implementing IFRS 9
The Central Bank of Jordan mandates that banks record the material impact of IFRS 9 implementation on the opening equity balance as of January 1, 2018, and transfer the accumulated general banking risk reserve to retained earnings. Banks must calculate expected credit losses using specific methodologies, ensuring that provisions for Stage 1 exposures do not exceed 1.25% of total credit risk-weighted assets when determining Tier 2 regulatory capital. The directive requires external auditors to certify the adequacy of these calculations and obliges banks to submit quantitative and qualitative disclosures alongside their financial statements. This instruction supersedes previous circulars and applies to all banks, including Sharia-compliant institutions.