UAE's banks 'must book provisions'
Abu Dhabi, January 29, 2011
Banks in the UAE, hurt by exposure to debt-laden Dubai World, must book provisions on a quarterly basis starting this year, according to a circular from the Central Bank.
The UAE Central Bank, which is pushing for transparency in the country's banking system, issued a clarification and guidance manual to banks dated Jan 27 advising them to follow guidelines issued last November. The new rules are in line with the Basel Committee on Banking Supervision standards.
"Banks had issues in interpreting the November circular. The latest one is a detailed clarification," a senior banker was quoted as saying in our sister publication, the Gulf Daily News.
"The Central Bank is also reiterating that provisions are compulsory every quarter because some banks did not follow this guideline last year," said the banker who asked not to be named.
The central bank said in the document that the implementation date of this manual is January 1 this year. – TradeArabia News Service