UAE mulls bank provisions on government-linked loans

The UAE Central Bank is mulling requiring banks to take provisions against loans to government and government-linked firms not directly guaranteed by the state, Al Ittihad said on Thursday.

Banks would have to take provisions at a certain percentage of these loans, a source told Al Ittihad, without specifying the percentage.

An exception would be loans extended directly to the federal government, local governments, ministries and their affiliate authorities, the source said. Loans to government sections and authorities was Dh156bn in October 2009, the paper said.

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