The Central Bank of Bahrain (CBB) has unveiled new regulations regarding the appointment of board members and senior management at licensed financial institutions, aiming to reduce administrative burdens while maintaining stringent standards.

The new rules, consolidated into a single Fit and Proper Module within the CBB Rulebook, replace previous requirements scattered across multiple volumes. This update significantly revises the prior ‘fit and proper’ criteria found in the Licensing Requirements, Authorisation, and Training and Competency Modules.

Key changes include a reduction in the number of senior management positions requiring CBB pre-approval, and the elimination of prescriptive ‘one-size-fits-all’ qualifications and core competency requirements. Instead, licensees will be responsible for developing their own internal standards.

By shifting the focus from pre-approval to accountability, the CBB empowers boards and CEOs to take full responsibility for ensuring the suitability of their senior management teams. This move reflects a strategic shift from co-managing appointments to holding leadership accountable for talent selection.

Commenting on the new rules, CBB director of regulatory policy unit Shireen Al Sayed said: “These revised requirements, the result of extensive industry consultations and benchmarking against leading financial centres, underscore our commitment to reducing compliance and administrative burdens. Simultaneously, we uphold the highest standards of integrity and competence within the financial services sector.

Ms Al Sayed

“By streamlining the approval process, we empower the industry to select the best talent for senior management roles, fostering growth in an increasingly competitive landscape.”

The new CBB prior approval requirements for board members and senior managers will be implemented on April 1, 2025. The remaining requirements will take effect on October 1, 2025. The module is applicable to all CBB licensees and is accessible in the Common Volume of the CBB Rulebook on the CBB website: https://cbben.thomsonreuters.com/rulebook/common-volume.

Copyright 2022 Al Hilal Publishing and Marketing Group Provided by SyndiGate Media Inc. (Syndigate.info).