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  • BR-5 BR-5 Ad-hoc Reporting and Notification

    • BR-5.1 BR-5.1 All Licensed Banks

      • BR-5.1.1

        The content of this Section is applicable to all banks, except as otherwise mentioned, (licensed by the CBB) in the Kingdom of Bahrain.

        Amended: April 2011
        Amended: October 2010
        October 2007

      • Large Exposures

        • BR-5.1.2

          Should any locally incorporated bank find that, for reasons outside its control or otherwise, it has an exposure to an individual counterparty (other than an exempt exposure) which results in it exceeding any of the limits set out under Chapter CM-5, this should be reported immediately to the CBB for its consideration, and action should be taken immediately to bring the exposure back within applicable limits as soon as possible.

          Amended: April 2011
          Amended: October 2010
          October 2007

      • Capital Increases, Changes in Strategy and Establishment of Subsidiaries/SPVs

        • BR-5.1.3

          [This Paragraph was moved to Section BR-5.2]

          Amended: April 2014
          Amended: April 2013
          Amended: April 2011
          Amended: October 2010
          October 2007

      • Current Management and Changes thereto

        • BR-5.1.4

          [This Paragraph was deleted in April 2012].

          Deleted: April 2012

        • BR-5.1.5

          The CBB must also be notified of any changes to the positions mentioned under Paragraph LR-1A.1.2 that may occur from time to time subject to observing the requirements set out in Section LR-1A.1. (See also Paragraph LR-1A.1.22).

          Amended: April 2014
          Amended: April 2012
          Amended: October 2010
          October 2007

        • BR-5.1.6

          For detailed rules and guidance on prior notification of appointment and changes in management inventory, refer to Chapters HC-1 and LR-1A.

          Amended: October 2010
          October 2007

      • Changes in Dealing Staff

        • BR-5.1.7

          [This Paragraph was deleted in July 2018].

          Deleted: July 2018

      • Appointment of a Compliance Manager/Officer

        • BR-5.1.8

          The appointment of a compliance manager/officer requires the CBB's prior approval (refer to Section LR-1A.1 for full details). The bank must outline how the compliance function fits into the bank's senior management reporting structure, and must give details of relevant reporting lines within the bank.

          Amended: April 2014
          Amended: October 2010
          October 2007

      • Money Laundering and Suspicious Transactions

        • BR-5.1.9

          The Money Laundering Reporting Officer (or his/her duly authorised delegate) must send a report to the Compliance Directorate of the CBB where he/she knows or has suspicions that a transaction might involve money laundering or terrorist financing, either due to the customer's economic standing or because it meets one of the examples of suspicious transactions described in Appendix FC-3.

          October 07

      • Promotion of Financial Products and Services Offered in/from Bahrain by Mean of Incentives etc.

        • BR-5.1.10

          [This Paragraph was deleted in April 2022].

          Deleted: April 2022
          Amended: April 2011
          Amended: October 2010
          October 2007

        • BR-5.1.11

          [This Paragraph was deleted in January 2022].

          Deleted: January 2022
          Amended: July 2012
          Amended: October 2010
          October 2007

      • UN SCR 1373 (2001)

        • BR-5.1.12

          The CBB requires all banks to notify it immediately of any act that might contravene the provisions of UN Security Council Resolution 1373 (2001). Banks should refer to Chapter FC-8 for full details of this requirement.

          Amended: October 2010
          October 2007

      • Notification of Fraud or other Material Concerns

        • BR-5.1.13

          All banks must report immediately to the CBB any frauds, either attempted or realised, or any well-founded concerns about the integrity of individual Directors or members of management. This obligation to disclose extends to individual Board members and members of management: i.e. if a Director or member of management has reasonable grounds to believe that information that should have been reported to the CBB has not, then they have a duty to report the matter personally to the CBB. All such cases shall be treated in the strictest confidence by the CBB.

          Amended: October 2010
          October 2007

        • BR-5.1.14

          All banks must report immediately to the CBB any material losses as soon as the bank becomes aware of them. This notification requirement is separate from notifications for loan write-offs (see BR-5.2.3) or frauds (see above), but refers to losses caused by external events (e.g. falls in stock markets) or internal control failures. In this context 'material' would mean: a loss which exceeds 5% of net earnings in a given quarter; or a loss which reduces the bank's capital adequacy by more than 1%; or a loss which reduces total assets by more than 1%.

          Amended: October 2010
          October 2007

      • Accounts for Charity Organisations

        • BR-5.1.15

          [This requirement was moved in October 2011 to Paragraph BR-4.1.5 as it is a monthly requirement].

          Amended: October 2011
          Amended: October 2010
          October 2007

      • Business Transfers

        • BR-5.1.16

          All banks must refer to Section GR-4.1 on business transfer requirements.

          Amended: April 2014
          Amended: July 2011
          Added: April 2010

      • Other Notifications

        • BR-5.1.17

          Banks must inform the CBB, in writing, of the following:

          (a) Any material problems or changes encountered with an outsourcing provider;
          (b) Any proposed ownership changes (whether in terms of structure or identity of controllers) prior to the change taking place and any change in controllers as a result of circumstances outside the bank's knowledge and/or control (ref GR-5.1.7); and
          (c) Any dismissal or suspension of any staff in internal audit, risk management, AML, compliance function or internal Shari'a review of the bank. The notification must include the reason for the dismissal or suspension of such individual.
          Amended: January 2023
          Amended: April 2014
          Added: July 2011

        • BR-5.1.17A

          Should the CBB have a cause for concern following its review of the notification referred to under Subparagraph BR-5.1.17(c), it may investigate the matter and should it establish the existence of any irregularity, misconduct or unfair decisions, it may take enforcement action on the bank, including an adverse action on the fit and proper status of the person(s) responsible.

          Added: April 2014

      • Settlement of Subordinated Loan

        • BR-5.1.18

          [This Paragraph was moved to Paragraph BR-5.2.12.]

          Amended: October 2014

    • BR-5.2 BR-5.2 Bahraini Conventional Banks

      • BR-5.2.1

        The content of this Section is applicable to all Bahraini conventional bank licensees licensed by the CBB in the Kingdom of Bahrain.

        Amended: April 2014
        Amended: October 2010
        October 2007

      • Capital Adequacy

        • BR-5.2.2

          All banks, referred to under Paragraph BR-5.2.1, must give the CBB immediate written notification of any actual breach by such banks of the minimum capital adequacy ratio (CAR) in accordance with Section CA-1.2. Where such notification is given, the bank must also adhere to the additional notification and reporting requirements as set out under Section CA-1.2.

          Amended: January 2015
          Amended: October 2010
          October 2007

      • Write-offs

        • BR-5.2.3

          All banks must notify the CBB of any write-off of a credit facility in excess of BD100,000 (or equivalent in other currencies) and must obtain the CBB's prior approval for write-offs concerning certain parties connected to the concerned bank or other entities (see Section CM-7.1 for full details).

          Amended: July 2012
          Amended: April 2008
          October 07

      • Term Financing Commitments

        • BR-5.2.4

          All banks must consult with the CBB before they enter into any term borrowing facilities or programs which have any restrictive covenants in relation to the capital or activities of the bank (such as the capital adequacy ratio, capital amount, leveraging, compliance with certain regulatory requirements, etc). For the sake of expediting the CBB's reaction to such consultations, banks must submit the draft term sheet of the facility to the Banking Supervision director at the CBB responsible for the supervision of the concerned bank, before committing themselves to the concerned facility (or renewing it).

      • Capital Increases, Changes in Strategy and Establishment of Subsidiaries/SPVs

        • BR-5.2.5

          All Bahraini conventional bank licensees must obtain the CBB's prior written approval for the opening of any new place of business either in the Kingdom of Bahrain or abroad (this would include the establishment or acquisition of a subsidiary, new branches or representative offices). Bahraini conventional bank licensees should refer to Article 51 of the CBB Law 2006 for full details.

          Added: April 2014

        • BR-5.2.6

          All Bahraini conventional bank licensees must obtain the CBB’s prior written approval for any proposed capital increase in a subsidiary and for any major change (regardless of type and/or effect) to the bank’s strategy or corporate plan prior to implementation (See also Paragraph HC-1.2.6).

          Amended: July 2021
          Added: April 2014

        • BR-5.2.7

          All Bahraini conventional bank licensees must obtain the CBB's prior specific written approval if they intend to act as originator, sponsor or manager of a special purpose vehicle ('SPV'), or if they intend to participate in the creation of an SPV, or if they intend to acquire a holding of 20% or more of the equity capital of an SPV. All Bahraini conventional bank licensees must seek prior specific written CBB approval if they are appointed as nominee shareholders of SPVs or hold votes by proxy arrangement in SPVs on behalf of other investors.

          Amended: January 2015
          Added: April 2014

        • BR-5.2.9A

          In addition to the points noted in BR-5.2.9, Bahraini conventional bank licensees which are involved with SPVs in any of the relationships described in Paragraph BR-5.2.7 must:

          (a) Not allow the SPVs to give any type of financial guarantee, warranty or indemnity to the investors in the SPVs or any other counterparty, either directly or on behalf of the bank.
          (b) Ensure that there are no legal or other restrictions on the availability of financial and other information relevant to the SPV and access to its business premises and records.
          (c) Not provide any credit facilities to the SPVs and/or extend any financial/liquidity support and/or guarantees.
          Amended: July 2020
          Added: April 2020

        • BR-5.2.8

          For purposes of Paragraph BR-5.2.7, in order to avoid any delays and/or disruption in implementation of a Bahraini conventional bank licensee's plan in this context, the CBB should be approached as soon as possible, even at a very preliminary stage.

          Added: January 2015

        • BR-5.2.9

          The CBB requires any Bahraini conventional bank licensee associated with an SPV to confirm the following points in any request for approval under Paragraph BR-5.2.7:

          (a) The purpose of the SPV;
          (b) The nature of the relationship between the Bahraini conventional bank licensee and the SPV (i.e. originator, sponsor, manager, investor, controller etc.);
          (c) The proposed consolidation/accounting treatment of the SPV in relation to the Bahraini conventional bank licensee both for the PIR and the audited financial statements' purposes as agreed with its external auditor;
          (d) The availability of financial and other information relevant to the SPV and access to its business premises and records; and
          (e) The Bahraini conventional bank licensee is not providing any guarantees, warranties or financial/liquidity support of any kind to the SPV.
          Amended: April 2020
          Added: January 2015

        • BR-5.2.10

          Where the SPV is consolidated into the accounts of a Bahraini conventional bank, the bank must provide separate accounting information on the SPV to the CBB on a quarterly basis. Furthermore, the annual audited financial statements of all consolidated SPVs must be submitted to the CBB within 3 months of the year end of the concerned SPV.

          Added: January 2015

        • BR-5.2.11

          Where a Bahraini conventional bank has a controller or majority ownership relationship with an SPV, or acts as sponsor, the bank must obtain the prior written approval of the CBB for any changes to the capital, ownership, management or control of SPV. All Bahraini conventional banks must also notify the CBB of any material events in relation to the SPV. If necessary, the CBB may require that formal information exchange arrangements are put in place (e.g. a memorandum of understanding) if the SPV is located in a foreign jurisdiction and its activities are not supervised locally.

          Added: January 2015

      • Early Settlement of Capital Items

        • BR-5.2.12

          In accordance with Paragraph CA-2.1.6(e) and (g) and CA-2.1.10(e), Bahraini conventional bank licensees must seek the CBB's prior written approval before exercising a call on an additional Tier one or Tier two capital issue, partially or in full, prior to the end of its term.

          Amended: January 2015
          Added: October 2014

    • BR-5.3 BR-5.3 Retail Banks

      • BR-5.3.1

        The content of this Section is only applicable to retail banks licensed by the CBB in the Kingdom of Bahrain.

        Amended: October 2010
        October 2007

      • Introduction of New or Expanded Customer Products and Facilities

        • BR-5.3.2

          All banks, referred to under Paragraph BR-5.3.1, should notify the CBB of information relating to any new or expanded customer products and facilities in accordance with the requirements set out under Section BC-4.7.

          Amended: October 2010
          October 2007

      • Installation or Removal of ATM in Bahrain

        • BR-5.3.3

          In accordance with Section BC-6.1, all banks referred to under Paragraph BR-5.3.1, must notify the CBB in writing if they installed or removed an ATM in Bahrain.

          Amended: April 2022
          Added: April 2012

      • Funds Received from NGO where no Valid Funds Collection License

        • BR-5.3.4

          In accordance with Paragraph BC-4.11.3, retail banks must notify the CBB in instances where donated funds have been received by an NGO and no valid funds collection license was submitted.

          Added: April 2014