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  • CM-B CM-B General guidance and best practice

    • CM-B.1 CM-B.1 Introduction

      • CM-B.1.1

        This chapter provides general guidance on the subject matter of this Module. This guidance could be in the form of papers / reports or other sources of information issued by international bodies.

      • CM-B.1.2

        This guidance promotes best practice and could generally be applied by all licensees to their activities.

      • CM-B.1.3

        Where applicable, the sources provided in this chapter should be used as an aid to reading the contents of this module.

    • CM-B.2 CM-B.2 Guidance provided by other international bodies

      • Basel Committee: Principles for the Management of Credit Risk

        • CM-B.2.1

          The paper (see www.bis.org/publ/bcbs75.pdf) which contains 17 principles, encourages banking supervisors globally to promote sound practices for managing credit risks in banking activities.

        • CM-B.2.2

          Throughout the module, references have been made to this paper and it is recommended that the regulations in this module be followed in conjunction with the guidelines presented in this paper.

      • Counterparty Risk Management Policy Group (CRMPG): Improving Counterparty Risk Management

        • CM-B.2.3

          This report (see www.isda.org/educat/pdf/CRMPG-report6-99.pdf), which was developed by a committee of market practitioners in the wake of the 1998 market disruptions, discusses counterparty credit risk and market risk management practices and how they can be enhanced.

        • CM-B.2.4

          The report covers four subject areas: transparency and counterparty credit assessments; risk measurement, management, and reporting; market practices and conventions; and regulatory reporting.

        • CM-B.2.5

          Of particular interest to risk managers is guidance provided in two areas, one on liquidity risk and leverage, and the other on counterparty credit exposure estimation.

      • Basel Committee: Framework for Internal Control Systems in Banking Organisations

        • CM-B.2.6

          The paper (see www.bis.org/publ/bcbs40.pdf) issued in September 1998 presents the first internationally accepted framework for supervisors to use in evaluating the effectiveness of the internal control over all on- and off-balance-sheet activities of banking organizations.

        • CM-B.2.7

          The paper describes elements that are essential to a sound internal control system, recommends principles that supervisors can apply in evaluating such systems, and discusses the role of bank supervisors and external auditors in this assessment process.

    • CM-B.3 CM-B.3 Enforceability

      • CM-B.3.1

        This guidance should not be taken as legally binding requirement, unless otherwise embodied in Bahrain law or by regulation.

      • CM-B.3.2

        It should be noted that the provisions in this chapter are to be taken as guidance by the licensees in order to promote sound credit risk management practices.