The Central Bank of Oman (CBO) has issued a ‘Bank Resolution Framework for Oman’, which spells out the recovery and resolution regime for the banking sector. The purpose of the Framework is to prepare banks for self-propelled recovery, and if circumstances necessitate, allow authorities to resolve them in an orderly way with least disruption and minimal cost to the national exchequer while preserving financial stability. The Framework will be applicable to all banks designated as Domestic Systemically Important Banks by CBO, and at its discretion, CBO may apply all or parts of the framework to any other bank licensed by it, a press statement from the bank noted.
“The release of the Resolution Framework in Oman is in line with the developments in the international regulatory arena, whereby, a number of other jurisdictions have established resolution frameworks to operationalise the key international standards proposed by the Financial Stability Board,” the Central Bank said.
The Bank Resolution Framework puts in place effective procedures to ensure that in the extreme event of any problems occurring at banks, the damage to the entire financial system of the country is kept at the minimum.
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