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2026-04-01

Internal Control of Credit Institutions

The Central Bank of Djibouti issued Instruction No. 2011-01 to mandate that all credit institutions establish and maintain a compliant internal control framework focused on risk identification, measurement, and management. The directive requires subject institutions to implement comprehensive risk mapping, strictly segregate operational and validation duties, appoint independent internal controllers, and adopt specific procedures for credit, market, liquidity, operational, and compliance risks. Furthermore, it imposes strict supervisory reporting obligations, including annual internal control reports, immediate fraud notifications, and a compliance deadline of March 31, 2012, while repealing the previous 1996 instruction.

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CENTRAL BANK OF DJIBOUTI

INSTRUCTION NO. 2011-01

ON THE INTERNAL CONTROL OF CREDIT INSTITUTIONS

The Governor of the Central Bank of Djibouti,

Having regard to Law No. 118/AN/06/6th L of 22 January 2011 amending the statutes of the Central Bank of Djibouti;

Having regard to Law No. 119/AN/11/6th L of 22 January 2011 on the establishment and supervision of credit institutions and financial auxiliaries;

Having regard to Decree No. 2011-10/PRE of 24 January 2011 appointing the Governor of the Central Bank of Djibouti.

Has decreed:

Chapter 1: General Provisions on Internal Control

Article 1: Obligation to Establish an Internal Control Framework

Credit institutions referred to in Article 3 of Law No. 119/AN/11/6th L of 22 January 2011 cited above, hereinafter referred to as "subject institutions", are required to maintain an internal control framework compliant with the specifications of this instruction.

Article 2: Objectives of the Internal Control Framework

  1. The internal control framework aims to identify the risks faced by the institution, measure them, and manage them. It also seeks to ensure that the institution's operations and organization comply with applicable legislation and regulations, and that all obligations set by the Central Bank of Djibouti are respected.

  2. This framework is reviewed regularly, particularly following any losses, fraud, or damages of any kind suffered by the institution, the adoption of a project to launch new activities or types of operations, and recommendations made by the Central Bank of Djibouti or the statutory auditor(s).

Article 3: Risk Mapping

  1. Risk identification by each subject institution consists of cataloging all risks it bears, due to its activity, clientele, and organization. The main risks related to banking activity are defined in Article 5 of this instruction. Subject institutions must identify from this list those to which they are exposed, as well as any others not listed.

  2. Subject institutions must establish a description of these risks, referred to as a "risk map", specifying for each risk to which they are exposed its origin and the measures implemented to ensure both its measurement and monitoring.

  3. This risk map must be reviewed annually and submitted to the external auditor, statutory auditors, and the Central Bank of Djibouti.

Article 4: Role of the Governing and Executive Bodies

  1. Subject institutions designate the individuals constituting the governing body and those forming the executive body: the governing body consists of individuals determining the credit institution's strategy; the executive body includes individuals ensuring, at the highest level, the day-to-day management of the institution.

  2. The governing body is responsible for defining the internal control framework. It reviews annually the evolution of risks faced, as well as the activity and results of internal control, based on information transmitted for this purpose by the executive body, the internal controller, and the statutory auditor. It issues

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