RM-A.1 RM-A.1 Purpose
RM-A.1.1
This Module contains requirements relating to the management of risk by
microfinance institution licensees .July 2014RM-A.1.2
This Module details the minimum key elements of a sound credit risk management system which the Central Bank of Bahrain ('CBB') requires its
microfinance institutions licensees to observe. These minimum requirements reflect the unique environment within whichmicrofinance institutions licensees operate and the range of products which they typically offer. However, the CBB, at its sole discretion, retains the right to impose more stringent requirements and guidelines upon one or moremicrofinance institution licensees should it consider such action to be in the best interest of the Bahrain financial system at any time.July 2014RM-A.1.3
This Module obliges
microfinance institution licensees to identify and document the major risks that they face, and what action will be taken to manage those risks effectively. Effective compliance with this Module will require the risk management framework to be supported by adequate resources and the appropriate tools to identify, monitor and control all material risks.July 2014RM-A.1.4
This Module provides support for certain other parts of the Rulebook, mainly:
(a) Principles of Business;(b) The CBB Reporting Requirements;(c) Auditors and Accounting Standards; and(d) High-level Controls.July 2014Legal Basis
RM-A.1.5
This Module contains the Central Bank of Bahrain's ('CBB') Directive (as amended from time to time) relating to the credit and operational risk management of
microfinance institution licensees , and is issued under the powers available to the CBB under Article 38 of the CBB Law. The Directive in this Module is applicable to allmicrofinance institutions licensees .July 2014RM-A.1.6
For an explanation of the CBB's rule-making powers and different regulatory instruments, see Section UG-1.1.
July 2014
