The Basel Committee on Banking Supervision has issued a Report on 18 March 2010 entitled "Report and Recommendations of the Cross-border Bank Resolution Group". The Report addresses the complex and multidimensional process that is required for an orderly resolution of Banking institution problems during a financial turmoil or crises. While the Report is largely aimed at the national authorities and makes recommendations on strengthening the national resolution power and their cross-border implementation; it also suggests that Banks, as well as key home authorities should develop practical and credible contingency plans to ensure access to relevant information in a crisis.
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This document is more relevant to Saudi Banks with cross-border operations. Nevertheless, the Agency would like all Saudi Banks to study this report and in particular focus on Recommendation #6 which proposes that there should be a contingency plan, proportionate to the size and complexity of your institutions/group’s structure and business, to preserve the firm as a going concern, promote resilience of key functions and facilitate rapid resolution if that becomes necessary. You may access the full document on the BIS website: (http://www.bis.org).
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In due course, the Agency would provide guidance to banks for the implementation of this recommendation as well as on other bank specific matters in other recommendations of this Report.
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For foreign banks’ branches in Saudi Arabia, The Agency will at a point in time arrange to receive from their Parent Banks, the relevant contingency plans for their operations in Saudi Arabia. Also, SAMA will cover this subject in the home/host meetings with relevant supervisory authorities for matters such as supervisory cooperation and exchange of supervisory information relating to the bank resolution regimes.
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If you need any further information in this regard, you may contact Mr. Fahd Al-Mufarrij at telephone # (01)466-2305 or Mr. Tariq Javed at telephone # (01)466- 2532.
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