Regulatory Alerts2023-03-29
Amendment of Rule 5 of the Account Opening Rules
The Saudi Central Bank, via Deputy Governor for Supervision Yazeed bin Ahmed Al-Sheikh, has issued a circular amending Rule 5 of the Bank Accounts Rules to redefine and update the classification, timelines, and operational requirements for dormant, active, and unclaimed banking transactions. The amendment updates the introductory definition to a sixty-calendar-month threshold, sets active and dormant account periods at twenty-four months each, and clarifies that unclaimed status applies after five years (including the dormant stage) once banks exhaust communication channels and cannot locate customers. Operating financial institutions in the Kingdom must implement these revised definitions, account categorizations, and asset preservation mandates effective immediately.
Circular
To: / Respected, Peace be upon you, Subject: Amendment to Rule 5 of the Bank Accounts Rules. I refer to Rule 5, included in Chapter 2 of the Bank Accounts Rules communicated via SAMA Circular No. (65681/67) dated 01/11/1440 AH, concerning dormant banking transactions. I hereby inform you of the amendment to the aforementioned Rule as detailed in the attachment. For your information and action, effective from its date. Yours sincerely, / Accept my regards, Al-Nu'man Yazeed bin Ahmed Al-Sheikh Deputy Governor for Supervision
Amendments to Rule 5 Concerning Dormant Banking Transactions, Included in Chapter 2 of the Bank Accounts Rules
First: Amendment to the introductory definition of dormant transactions, as follows: "They are accounts, relationships, and transactions that have completed sixty calendar months from the date of the last financial transaction executed by the customer personally, their authorized agent, or heirs. They are divided into three stages as stipulated in this Rule. This Rule aims to ensure continued activity of transactions and preserve customer assets (funds) for which no financial transaction (withdrawal or deposit – depending on the nature of the relationship) has been executed by the customer personally, recorded or via authenticated correspondence, within the time period specified in Item 5..."
Second: Amendment to Item 1 of Paragraph 5-1, specifying transactions subject to this Rule, as follows: "Current accounts in credit, and savings accounts for which the customer personally, their authorized agent, or heirs have not executed any financial transaction (withdrawal or deposit)."
Third: Amendment to Paragraph 5-2-1, specifying active account rules, as follows: "Transactions are considered active if no more than twenty-four calendar months have passed since the last financial transaction (withdrawal or deposit – depending on the nature of the relationship) executed by the customer personally, their authorized agent, or heirs, or a recorded or authenticated correspondence."
Fourth: Amendment to Paragraph 5-2-2, specifying dormant account rules, as follows: "Transactions are considered dormant if twenty-four calendar months have completed starting from the date of the last financial transaction (withdrawal or deposit – depending on the nature of the relationship) executed by the customer personally, their authorized agent, or heirs, recorded or via authenticated correspondence."
Fifth: Amendment to Paragraph 5-2-3, specifying unclaimed account rules, as follows: "Transactions are considered unclaimed (Unclaimed) if they have completed five calendar years (sixty months), including the dormant account stage, from the date of the last financial transaction (withdrawal or deposit – depending on the nature of the relationship) executed by the customer personally, their authorized agent, or heirs, recorded or via authenticated and documented correspondence, and the bank has been unable to locate the customer and exhausted all communication means."
End.
Distribution Scope:
- Banks and financial institutions operating in the Kingdom.
P.O. Box 2992, Riyadh, 11169, Kingdom of Saudi Arabia | Tel: +966 11 463 3000