05 December 2005
A central bank with a BD500 million capital will be established in Manama to replace the Bahrain Monetary Agency to meet the Kingdom's comprehensive development plan for the banking sector.
The bank might have branches inside and outside the Kingdom to facilitate its activities. It will be an autonomous commercial and financial organisation and have its own budget.
"The bank will draw and implement frameworks for the financial sector, offer banking services for government and private companies, develop the financial sector and protect the Kingdom's reputation as secure financial centre," economist and head of the Financial Committee at the Chamber of Deputies, Jihad Bukamal, said.
The bank in association with the Ministry of Finance will protect the local currency's value through ensuring certain growth in economy. To some extent the bank will also fulfil the duties of the government's bank, in terms of advices and being the representative of the government at Arab and international monetary agencies.
The bank will open a new era in the banking services in Bahrain as it will cover all banking organisations and insurance companies.
More stock exchange organisations will be offered licences by the bank to enhance the stock exchange activities.
After the formation of the bank, the BMA will be dissolved and the decree law on insurance companies for the year 1987 will be cancelled.
The bank will handle the local currency affairs and foreign exchange along with the financial ties between the Kingdom and the rest of the world.
The bank will regulate the local financial market, support the banking services and guide banks towards better facilities for the customers.
The bank will be established soon after the approval of a draft law on its formation that is being discussed by the Chamber of Deputies.
Bukamal said that the committee had reviewed 28 articles out of 178 and the bill would be discussed in a public session soon after getting the views of representatives from banking and financial organisations.
"The bank is a turning point in the banking history in the Kingdom, as it will work towards improving the banking services." A governor with the rank of a minister will be appointed to handle the daily activities and decision-making of the bank.
It could offer loans that are no more than 25 per cent of the state budget for the government in emergency cases, but it won't practise any commercial, agricultural or financial transactions.
The bank will have the authority to settle disputes between financial or insurance organisations by assigning local or foreign companies to investigate the cases.
Establishments violating the bank's regulations would be liable to pay around BD20,000 fine or would be included on the watch list. Companies or individuals caught forging currency will be jailed, fined BD10 million or both.
Top official at the Bank of Bahrain and Kuwait, Dr Fareed Al Mulla, said that the bank could considerably enhance the banking services in the Kingdom, if the government takes the point of views of bankers and financial organisations into consideration.
A central bank with a BD500 million capital will be established in Manama to replace the Bahrain Monetary Agency to meet the Kingdom's comprehensive development plan for the banking sector.
The bank might have branches inside and outside the Kingdom to facilitate its activities. It will be an autonomous commercial and financial organisation and have its own budget.
"The bank will draw and implement frameworks for the financial sector, offer banking services for government and private companies, develop the financial sector and protect the Kingdom's reputation as secure financial centre," economist and head of the Financial Committee at the Chamber of Deputies, Jihad Bukamal, said.
The bank in association with the Ministry of Finance will protect the local currency's value through ensuring certain growth in economy. To some extent the bank will also fulfil the duties of the government's bank, in terms of advices and being the representative of the government at Arab and international monetary agencies.
The bank will open a new era in the banking services in Bahrain as it will cover all banking organisations and insurance companies.
More stock exchange organisations will be offered licences by the bank to enhance the stock exchange activities.
After the formation of the bank, the BMA will be dissolved and the decree law on insurance companies for the year 1987 will be cancelled.
The bank will handle the local currency affairs and foreign exchange along with the financial ties between the Kingdom and the rest of the world.
The bank will regulate the local financial market, support the banking services and guide banks towards better facilities for the customers.
The bank will be established soon after the approval of a draft law on its formation that is being discussed by the Chamber of Deputies.
Bukamal said that the committee had reviewed 28 articles out of 178 and the bill would be discussed in a public session soon after getting the views of representatives from banking and financial organisations.
"The bank is a turning point in the banking history in the Kingdom, as it will work towards improving the banking services." A governor with the rank of a minister will be appointed to handle the daily activities and decision-making of the bank.
It could offer loans that are no more than 25 per cent of the state budget for the government in emergency cases, but it won't practise any commercial, agricultural or financial transactions.
The bank will have the authority to settle disputes between financial or insurance organisations by assigning local or foreign companies to investigate the cases.
Establishments violating the bank's regulations would be liable to pay around BD20,000 fine or would be included on the watch list. Companies or individuals caught forging currency will be jailed, fined BD10 million or both.
Top official at the Bank of Bahrain and Kuwait, Dr Fareed Al Mulla, said that the bank could considerably enhance the banking services in the Kingdom, if the government takes the point of views of bankers and financial organisations into consideration.
© Bahrain Tribune 2005
