1. Introduction
Effective from Jan 31 2025 - Jan 25 2020
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| - | Central Counterparties (CCPs) have become increasingly critical components of the financial system in recent years, due in part to the introduction of mandatory clearing for standardised OTC derivatives in some jurisdictions. Consistent with the key responsibility of guaranteeing the fulfilment of transactions to their clearing participants, CCPs play an important role in mitigating contagion risk in the event of a participant default. A CCPs ability to effectively manage a default is essential to its resilience and can help reduce systemic risk. |
| - | SAMA via these guidelines, is emphasizing on the treatment of banks' trade exposures to a CCP under capital, large exposures, leverage ratio rules along with Pillar 2 framework. |
| - | Banks should note that the foreign regulators would do an assessment to include Saudi CCPs in the list of their Qualifying Counterparties (QCCPs), in terms of exposures of banks under their jurisdictions to this entity. |