SAMA has recently observed an increase in violations committed by several banks, where certain measures were taken before obtaining prior approval from SAMA. The most significant of these violations include the following:

1. Setting up headquarters for main administrations or operational branches, and then writing to SAMA to obtain approval for the move from the original licensed location to the newly prepared site.

    2. Opening offices in different locations for specific purposes and for a limited period, or at exhibitions or festivals.

     3. Closing operational branches, converting them into offices, or downsizing banking operations within them.

     4. Setting up, installing, or operating ATMs without a license.

     5. Transporting or cancelling operational or non-operational ATMs without obtaining approval from SAMA.

     6. Engaging in speculative activities and bidding on certain locations that have already been licensed to a bank, thereby depriving the location of banking services.

     7. Combining licenses for automated devices with licenses for active or inactive branches.

     8. Failure to follow through with the process of opening branches and machines within the nine-month licensing period, and not providing an explanation when requested for renewal about the reasons that prevented the bank from opening the branch or installing the ATM.

And since the banks' adherence to these procedures constitutes a clear violation to The Banking Control Law in accordance with the current applicable regulations in this regard, we hope that you will inform your relevant personnel about the necessity to follow and adhere to the following instructions:

a) No bank may open new branches, other offices, or ATMs in any region of the Kingdom without first obtaining an official prior license from SAMA.

b) When the bank obtains a license from SAMA to open a branch or install an ATM machine, it is not permissible to move it from one location to another without obtaining written approval from SAMA. This applies whether the branch is operational or non-operational, or whether the ATM machine is operational or non-operational.

c) When the bank obtains approval from SAMA to open a branch at any location, installing an ATM at the branch is covered under the branch's license. There is no need to obtain a separate license for the ATM. however, SAMA must be informed about it.

d) The license for an independent ATM (outside branch premises) cannot be merged with any branch, regardless of whether it is operational or non-operational.

e) The duration of the license is nine months from the date of approval issuance, and the bank must follow up to complete the opening within this period. If the opening cannot be completed within this time frame, the bank must inform SAMA of the reasons that led to this before the license period ends.

f) The licenses for non-operational branches are extended every six months to provide the bank with the opportunity to prepare the site.

g) The bank must provide SAMA at the end of every six months with a report that includes its position regarding the opening of branches or the installation of ATMs.

c) Every bank must attach the following information when requesting approval to open a branch or install an ATM:

- Feasibility study for opening a branch or installing an ATM.

- A sketch map showing the exact location of the desired branch or the machine.

t) SAMA must be notified of the actual opening date of the branch and the commencement of its operations or the date the machine becomes operational.