REGULATION WATCH- Madbouly sets framework for leasing and factoring companies to appeal FRA decisions: Prime Minister Moustafa Madbouly issued on Saturday a decree outlining the avenues for leasing and factoring players to appeal administrative decisions from the Financial Regulatory Authority (FRA) in accordance with the Leasing and Factoring Act. Under the decision, companies will have one month to lodge appeals against any of the authority’s decrees, and will be required to make an EGP 20k payment to the FRA’s appeals committee, which will be reimbursed if their appeal is accepted. The regulations are part of a Leasing and Factoring Act the House of Representatives passed last year, which regulates leasing and factoring as non-banking financing tools that are subject to oversight by the FRA.

This comes as the FRA sets solvency standards for companies: The newly announced framework was followed by fresh standards to ensure leasing and factoring companies can remain solvent, according to an FRA statement. A fixed capital base and a borrowing threshold that’s equivalent to 9x the size of the base level were among the standards, which also require companies to diversify their risk portfolios and deposit a proportion of their revenues with the FRA to hedge customer default risks. The required level of capital will be calculated based on operational and credit risk. The regulator also set conditions for companies to cross off irrecoverable debt from their loan portfolios.