Refinancing Loans - Jordan

1	Funding /risk transfer / both	Equity, issuance of bonds, central bank loan
2	Eligible assets	First-degree mortgages, temporary guarantees (Jordanian government bonds or bonds guaranteed by the Jordanian government, treasury bills, bonds issued by the company) & authorization to debit on the financial institution's account at the Central Bank of Jordan in favor of JMRC.
3	Brief description of structure for each	Issuance of bonds and granting the proceeds as refinance loans with a margin.Refinance loans to banks are secured by mortgage balances portfolios with at least 120% coverage ratio of the refinance amount, the banks continue to manage and service these portfolios If a loan in the portfolio is prepaid or defaults, the bank must replace it with another eligible loan to maintain the coverage ratio of 120%. Funding is raised through local bond issuances, and proceeds are used to refinance banks based on demand. The company aims to match maturities of funding and lending to reduce liquidity and interest rate risks
4	Fees / pricing structure	JMRC margin on refinance loans granted to banks is between (1% to 1.1%) for all banks without exception and is determined at the beginning of each year by the Board of Directors' when approving the estimated budget. JMRC margin on refinance loans granted to leasing companies is determined by a credit rating scoring system and the maximum and minimum is between (1.25% to 1.50%) for all leasing companies without exception and determined at the beginning of each year by the Board of Directors' when approving the estimated budget.
5	Servicing	Loan is repaid in a lump sum on the due date & interest is paid semi-annually
6	Risk sharing (if appropriate)	In case of default, banks bear the risks
7	Other Comments	N/A