KSA Recovery and Resolution: SAMA Seeks Public Input on Valuation Rules for Systemically Important Financial Institutions

The Saudi Central Bank calls for a public consultation on the draft Systemically Important Financial Institutions' (SIFI) Valuation Rules. The aim of the draft rules is to provide guidelines for the fair and prudent valuation and determination of the assets and liabilities of a SIFI prior to resolution procedures.

The rules lay out details about how the Central Bank will conduct the valuation process, including:

• Valuation methodology: Both ex-ante and ex-post valuations will be considered.

• Factors and information: The rules will specify the factors and information to be taken into account concerning the valuation, including scenarios for potential resolution actions.

• Appointment of accredited valuers: The process for appointing accredited valuers will be outlined in the rules.

Consultation period: February 20, 2024, to March 6, 2024.

Note: Resolution occurs when a financial institution is likely to fail, and the central authorities intervene to wind down the bank in an orderly manner to protect the public interest. This step is taken when normal insolvency procedures are deemed insufficient to safeguard these interests.

SAMA - Draft Systemically Important Financial Institutions’ Valuation Rules.

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