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Subject: "Qualification Requirements for Appointment to
Senior Positions in Banks Operating in Saudi Arabia".
In pursuance of SAMA's powers to supervise banks operating in Saudi
Arabia in accordance with its Charter issued by Royal Decree No. 23
dated 23/5/1377 and the Banking Control Law promulgated by Royal
Decree No. M/5 dated 22/2/1386 H;
And with reference to Article 3 of the Banking Control Law
stipulating the licensing requirements to be met by a national bank,
including that the founders and members of the Board of Directors
shall have a sound reputation, and Article 12 of the Law specifying
the conditions by which a person is prohibited to be appointed as a
Director of the Board or a Manager in any bank, and Article 22 of
the Law concerning the suspension or removal of any director or
officer of the bank;
And with reference to paragraph 2 of the Rules for enforcing the
provisions of the Banking Control Law issued by the Minister of
Finance’s Decision No. 3/2149 dated 14/10/1406 concerning the
enforcement of the provisions of Article 12 of the Banking Control
Law, and paragraph 5 of the said Rules related to the application of
Article 22 of the Law;
SAMA has added other requirements for appointment to senior
positions in banks operating in the Kingdom as follows:
1. Directors
a.
A bank must provide required information on
each member of its Board of Directors, including the Chairman, as
per the attached Forms Nos. (1) and (2). Also, a brief curriculum
vitae of each Director should be attached.
b.
A bank must provide required information on
each person to the membership of the Board of Directors for next
session as per the attached Forms Nos. (1) and (2). A brief
Curriculum vitae of each Director should also be attached. These
forms should be submitted to SAMA 15 days prior to the date of the
General Assembly.
c.
After nominating Directors of the Board, they
shall select the Chairman of the Board and the Chairman of the Audit
Committee. SAMA shall be notified in writing within 15 days after
the date of this selection.
d.
A bank should notify SAMA in writing within
15 days after the selection / appointment of a person as a new
Director of a bank or of any of its subsidiaries. The information as
per the attached Forms Nos. (1) and (2) should be submitted to SAMA,
in addition to a brief curriculum vitae of the new Director.
e.
SAMA should be notified in writing within 15
days of the dates of any resignations, discharge or removal of any
Director. All relevant information, along with the reasons thereof
must be provided.
2. General Managers and Managing Directors.
A General Manager or a Managing Director means a person who under
the authority of the Board of Directors of the bank is granted the
power to exercise responsibilities of the Chief Executive Officer.
The banks shall be subject to the following requirements:
a.
A bank must provide required information on
its Managing Director / or General Manager as per the Forms Nos. (1)
and (2) attached to this Circular. Also, a brief curriculum vitae of
him should be submitted. A bank should also in the future obtain
SAMA's prior approval for the appointment of a General Manager or
Managing Director, and it should provide SAMA with information on
appointees as per Forms Nos. (1) and (2) attached herein, in
addition to a curriculum vitae of each of them. This information
should be provided 15 days before such appointment.
b.
SAMA should be notified in writing within 15
days of the date of any resignation, termination, removal, for any
reason, of a General Manager or a Managing Director along with all
information and reasons for such action.
3. Major Department Heads and Senior Managers
This category includes top tier managers who head key functions and
departments of a bank such as the Treasurer, the Chief Credit
Officer, the Chief Operations Officer, Head of Corporate, Retail,
Private and Investment Banking, the Chief Financial Officer, the
Chief Internal Auditor, as well as senior officials such as the
Legal Counsel and the Compliance Officer.
For appointment to any of the indicated positions, a bank should
notify SAMA in writing 15 days prior to the date of such
appointment, submitting the information on the appointees as per the
Forms Nos. (1) and (3) attached to this circular along with their
brief curriculum vitae. This should be submitted in writing 15 days
before the date of such appointments.
4. Overseas Branches, Subsidiaries and Representative
Offices
Saudi Banks are required to provide the information described above
for Directors, General Managers and Senior Managers of their
overseas branches, subsidiaries and representative offices as per
the Form Nos. (1) and (3) attached to this circular along with a
brief curriculum vitae of the appointees to these positions.
5. Annual Information on Senior Positions in
Banks Operating in the Kingdom.
A bank should provide SAMA, within 60 days after the end of its
financial year, with the following information:
a.
List of all Members of the Board of Directors,
including names, dates of appointment, positions held on any bank
committees, and other important information on their work at the
bank – to be filled in the attached Form (4).
b.
List of all General Managers and Managing Directors,
and Senior Managers of the bank, including names, current positions,
dates of appointment to current positions, number of years of
employment with the bank and other important information on their
work at the bank, to be filled in the attached Form (4).
c.
List of all Directors, General Managers, Managing
Directors, and Senior Managers of its key departments and for
overseas Branches, Subsidiaries and Representative Offices,
including names, current positions, dates of appointment, number of
years of employment with the bank, and other important information
on their work at the bank, to be submitted on the attached Form (5).
6. Foreign Banks' Branches Operating in the Kingdom.
These branches are required to provide information on their Regional
Managers and Senior Officers, to be filled in the attached Forms (1)
and (3), along with brief curriculum vitae for each of them. A
foreign bank should also seek SAMA's prior approval for the
appointment of General Managers and Senior Officers of its branches
operating in the Kingdom, and it should provide SAMA with
information on them as per the Forms Nos. (1) and (3) attached
herein along with brief curriculum vitae for each of them, 15 days
prior to such appointments.
When making appointments to the above positions, a bank should
indicate in its employment agreements that such appointments are
subject to SAMA's prior approval.
The information required under item #5 above is to be provided to
SAMA – Banking Supervision Department - for the year ending 31st
December 2005 by 31st January 2006 and thereafter
annually. The effective date of this Circular is 1st
April 2005 (22/2/1426 H).
You are kindly requested to comply with the provisions of this
Circular and advise all your branches and representative offices to
act accordingly.
Forms 1 to 5
Form (1)
Form (2)
Form (3)
Form (4)
Form (5)
All
Forms (1
to 5)
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