Obtaining SHARI’A Committee Approval of Credit-Related Policies for Shariah Compliant Products
| No: 43062729 | Date(g): 15/2/2022 | Date(h): 14/7/1443 | Status: In-Force |
Translated Document
Effective from Jun 01 2022 - May 31 2022
To view other versions open the versions tab on the right
Based on the authority vested in SAMA under its Saudi Central Bank Law issued by Royal Decree No. M/36 dated 11/04/1442 H, and The Banking Control Law issued by Royal Decree No. M/5 dated 22/02/1386 H and SAMA Circular No. 41042498 dated 18/06/1441 H the amount under it is the Shariah governance framework for local banks operating in the kingdom and Circular No. 43038156 dated 27/04/1443 H the notified amount constitutes the risk management framework for shariah compliant banking which represents the first phase of establishing a supervisory framework for banks and practicing Islamic banking.
Therefore, SAMA emphasizes that banks offering Shariah-compliant credit products, must obtain approval from the Shariah committee within the bank for all credit-related policies and procedures. This includes all steps from granting credit to the termination of the credit relationship, as well as procedures for early repayment and restructuring/rescheduling, before obtaining approval from the bank's board of directors or their authorized representatives, as applicable.
SAMA also emphasizes the necessity of complying with all regulatory requirements for banks that engage in Islamic banking activities, in addition to other regulatory requirements issued by SAMA.
For your information and action as of June 1, 2022.