The Central Bank of Bahrain issued new requirements for licensed financial institutions regarding the appointment of members of the Board of Directors and the higher executive management, as part of a common separation in the bank’s directives folder to replace the requirements of “matching and suitability” previously listed in the classes of “licensing requirements”, “approvals/permit” and “training and efficiency” within all folders of the directives of the Central Bank of Bahrain.
The new joint separation aims to reduce the number of executives subject to the approval of the Central Bank of Bahrain, and to cancel the requirements of the unified mandatory qualifications and competence to fill these positions, and it will also require the licensed financial institutions to develop their own standards in this regard.
By reducing the number of prior approvals, the Central Bank of Bahrain will not participate in managing the appointments of members of the High Executive Management, which will make the responsibility to ensure the suitability of the people who occupy these positions on the board of directors and the CEO of the licensed financial institution.
Commenting on the new directives, Mrs. Sherine Abdel Karim Al -Sayed, Director of the Control Policy Unit at the Central Bank of Bahrain, said: “The new requirements have been developed based on extensive discussions with the financial services sector in the Kingdom and compared the practices used in prestigious financial centers, and these requirements reflect the ongoing efforts made by the Central Bank of Bahrain to reduce the burden of commitment and administrative burdens on licensed financial institutions while preserving the highest Standards of integrity and efficiency in the sector.
By simplifying the approval process, the bank aims to enable the sector to obtain greater freedom in choosing appropriate talents to assume the positions of higher executive management and support the growth of financial institutions licensed in the competitive environment witnessed by the sector.
The requirements for approval will be applied to the Board of Directors and executive management starting from April 1, 2025 and other requirements starting from October 1, 2025, to all financial institutions licensed by the Central Bank of Bahrain.
The requirements can be found within the joint bank’s directive folder on the website: https://cbben.thomsonreutors.com/rulebook/common-Volume
