GR-4 GR-4 Asset / Liability Transfers
GR-4.1 GR-4.1 BMA Approval
GR-4.1.1
Islamic bank licensees must seek prior written approval from the BMA before transferring assets or liabilities of a material nature to a third party, except where such transfers are effected within the normal scope of the bank's operations.GR-4.1.2
Rule GR-4.1.1 is intended to apply to circumstances where a bank wishes to sell part of its business or a portfolio to a third party, or is undertaking winding up proceedings. It implements the provisions contained in Article 65(A)(2) of the BMA Law 1973.
GR-4.1.3
For the purposes of Rule GR-4.1.1, assets or liabilities of a material nature would be assets or liabilities that comprise 5% or more of the total assets or liabilities of the bank concerned, and any amounts placed with the banks through investment accounts and safe-keeping accounts.
GR-4.1.4
In the case of a
Bahraini Islamic bank licensee , Chapter GR-4 applies to its assets and liabilities booked in Bahrain and in the bank's overseas branches. In the case of anoverseas Islamic bank licensee , Chapter GR-4 applies only to assets and liabilities booked in the bank's Bahrain branch.GR-4.1.5
Islamic banks intending to apply to transfer assets or liabilities are advised to contact the BMA at the earliest possible opportunity, in order that the BMA may determine the nature and level of any documentation to be provided and the need for an auditor or other expert opinion to be provided. The BMA will grant its permission where the transfer will have no negative impact on the financial soundness of the bank, and does not otherwise compromise the interests of the bank's investment accounts holders, depositors and creditors. In all cases, the BMA will only grant its permission where the institution acquiring the assets or investment account/deposit liabilities holds the appropriate regulatory approvals and is in good regulatory standing.
