Saudi Arabia: Financial Sector Assessment Program-Detailed Assessment of Observance-Basel Core Principles for Effective Banking Supervision

International Monetary Fund

No 2024/282, IMF Staff Country Reports from International Monetary Fund

Abstract: This paper discusses Detailed Assessment of Observance of the Basel Core Principles for Effective Banking Supervision for the Saudi Arabia Financial Sector Assessment Program. Saudi Central Bank (SAMA) has progressively updated its regulations and continued focus on this process will be important. SAMA’s responsibility for banking supervision is clearly set out in the law, although without clearly establishing the promotion of safety and soundness of banks and the banking system as an explicit or primary mandate. There is room to strengthen SAMA’s operational independence, accountability framework, transparency, and legal protection. Strengthening powers and updating regulations, along with developing internal guidelines, will help strengthen processes for licensing, transfer of significant ownership and controlling interest, and major acquisitions by banks. SAMA’s well-established risk-based approach would benefit from a review of the scope of application of supervisory oversight, tools, and reporting. Prudential requirements mostly apply (appropriately) at both a solo and consolidated level, but monitoring is in practice only at the domestic level.

Keywords: IMF-World Bank Financial Sector Assessment Program; adequacy ASSESSMENT process; banking supervision department; banking control law; counter financing; Bank supervision; Credit risk; Anti-money laundering and combating the financing of terrorism (AML/CFT); Market risk; Operational risk; Global (search for similar items in EconPapers)
Pages: 310
Date: 2024-09-04
New Economics Papers: this item is included in nep-ara
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