Oman gives banks three years to separate securities businesses

Omani banks conducting certain securities activities alongside commercial banking have up to three years to move those operations into legally independent entities under a new capital-market rulebook that took effect in July.
The requirement is part of the Executive Regulation of the Securities Law, issued under Financial Services Authority Decision No. E/11/2026. Effective from July 27, the regulation replaces executive rules dating to 2009 and provides the detailed framework for the Securities Law promulgated by Royal Decree No. 46/2022.
Commercial banks are generally required to conduct activities regulated under the Securities Law through a legally independent entity. Custody and trust services, as well as underwriting, are excluded from the separation requirement.
For affected institutions, implementation extends beyond minimum capital requirements to governance, regulatory reporting, compliance, systems and the organisation of existing securities businesses.
The FSA says the separation is intended to reduce conflicts of interest and limit the transmission of risk between commercial banking and securities-related investment activities.
Ahmed bin Ali al Maamari, Vice Executive President of the FSA, told Oman News Agency in July that the regulation establishes investment banking as a regulated activity alongside more detailed requirements for capital-market institutions, including minimum capital.
BANKS ALREADY ACTIVE IN SECURITIES
The changes come as several Omani banks already hold licences for activities covered by the securities framework.
The FSA register, accessed on September 28, lists National Bank of Oman for activities including brokerage, issue management, portfolio management, investment advice and research and investment management.
BankDhofar is licensed for portfolio management, issue management, fund administration, investment management and investment advice and research.
Sohar International also holds licences covering a range of securities activities, including issue management, portfolio management and investment-related services.
Bank Muscat’s own public materials describe an asset-management division offering portfolio management, investment funds and structured products. Its wholesale-banking business also includes corporate finance and capital-market activities.
The register and bank disclosures show how far securities services are embedded in parts of the banking industry. No bank-specific plans for reorganising those businesses under Decision E/11/2026 were identified in the public disclosures reviewed for this report.
The three-year transition gives affected banks substantially longer than other capital-market institutions to bring their structures into line with the new rules.
A MUCH LARGER MARKET THAN IN 2009
A client note from law firm Dentons said the regulation replaces the 2009 framework and aligns the detailed rules with the 2022 Securities Law and the subsequent development of Oman’s capital market.
That development has been rapid. MSX market capitalisation stood at approximately RO39.41 billion on September 24, up from about RO32.15 billion in late December 2025.
The MSX 30 Index was at 7,554.13 points on September 24, compared with 5,944.80 points on December 24, 2025.
The expansion has coincided with a series of government-backed measures, including listings associated with the Oman Investment Authority, market-making and liquidity initiatives and incentives designed to bring more private and family-owned companies into the capital market.
The FSA says more than RO7 billion in financing was provided through the capital market between 2021 and 2025. Its published material does not break that total down between government issuance and private-sector financing, or among equity, corporate bonds, sukuk and other instruments.
FIVE ACTIVITIES DEFINE AN INVESTMENT BANK
Under the regulation, an investment bank combines five activities: investment management, product structuring, securities portfolio management, research and advisory services related to listed securities, and issue management.
Licensed investment banks may also act as underwriters for securities issues approved by the FSA.
The regulator describes investment banks as intermediaries between businesses seeking finance and local and international investors. Their activities can include structuring securities issues, arranging transactions, advising issuers and helping widen the investor base.
Oman already has specialist institutions operating outside commercial banks. Oman Investment Bank, established and registered with the FSA on November 5, 2023, operates in the securities sector alongside brokerage, asset-management and investment companies.
FUNDS BROUGHT INTO THE WIDER FRAMEWORK
Investment funds form another part of the revised regime, although they are not new to Oman.
The regulation specifies 11 categories, including mutual, liquidity, real-estate, debt-instrument, index, private-equity, venture-capital, green and sustainable funds. Investment funds were already regulated under the previous framework; the FSA describes the 2026 change as an expansion of the categories of collective investment funds.
Total capital in investment and real-estate funds reached around RO 1.2 billion in 2025, up 89.9 per cent from RO 630.8 million a year earlier, according to FSA data.
FIRST DEADLINE FALLS IN JANUARY
Other entities governed by the Executive Regulation were given six months from July 27 to regularise their position, putting the deadline at the close of business on January 27, 2027. Banks subject to the separation requirement have up to three years.
The FSA said at its September 23 briefing that around 37 per cent of the provisions in the new regulation are either newly introduced or amended.
For securities firms, the first compliance deadline is now approaching. For banks, the longer transition opens a separate restructuring period as they determine how securities activities now conducted within banking operations will fit the new legal and licensing structure.