To: All Licensed Banks operating in the Sultanate of Oman

Subject: Lending Ratio

After Compliments,

1. Attention of licensed banks is drawn to Oman Central Bank Circular No. BM870/1999 dated 21 June 1999 advising the retention of enhanced lending ratio of 87.5% up to 31 December 1999.

2. It is hereby advised that the Board of Governors, in their meeting on 12 October 1999, resolved to remove the time stipulation of 31 December 1999 for the lending ratio limit of 87.5%.

3. Accordingly, an amendment to Article 1 of Oman Regulation No. BM44/7/1998 (refer Oman Central Bank Circular No. BM849/1998) shall be published, as under:

   Article 1:

   No licensed bank shall lend, whether by loans, discounts, advances and/or overdrafts, whether secured or unsecured when such lending in aggregate exceeds 87.5% of its deposits as provided for in Article 2.

4. Licensed banks are in the meantime advised to note the above change, made to remove the uncertainty and consequent tightness of liquidity, if any, perceived.