2012-10-01

Enhancements to Basel II Operational Risk Principles and CBB Rulebook Revisions

The Central Bank of Bahrain issued revised operational risk regulations under Module OM-8 to align domestic banking standards with Basel II principles. The rules mandate board-level oversight of operational risk, clarify the distinct roles and independence requirements for internal audit and compliance functions, and require board-approved risk appetite statements alongside robust framework documentation. These revisions standardize risk definitions, mandate independent reviews of operational risk frameworks, and introduce cross-referenced guidelines to enhance transparency, benchmarking, and compensation alignment across Bahraini banks.

Bahrain

Central Bank of Bahrain

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