Kingdom of Bahrain: Financial Sector Assessment Program, Detailed Assessment of Observance Assessment of Observance of the CPMI-IOSCO Principles for Financial Market Infrastructures
IMF Staff Country Reports, June 16, 2016
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- Kingdom of Bahrain: Financial Sector Assessment Program, Detailed Assessment of Observance Assessment of Observance of the CPMI-IOSCO Principles for Financial Market Infrastructures
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Bibliographic details
- Published: June 16, 2016
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781498304030.002
Executive summary
- This paper provides a detailed assessment of observance of the Committee on Payments and Market Infrastructures–International Organization of Securities Commissions principles for financial market infrastructures (FMIs).
- Major achievements have been made to establish safe and efficient payments and securities settlement systems in Bahrain.
- The real-time gross settlement system is highly concentrated and has tight interdependencies with the securities settlement system, making risks management a top priority.
- The formal assessment suggests that most of the principles are broadly observed, and identifies areas to improve for closer alignment with international standards.
- The objective of the assessment has been to identify potential risks related to FMIs that may affect financial stability.
Key findings
- Most CPMI-IOSCO principles for FMIs are broadly observed.
- Real-time gross settlement (RTGS) system is highly concentrated.
- Tight interdependencies exist between the RTGS and the securities settlement system (SSS).
- Risk management in FMIs is a top priority due to concentration and interdependencies.
- The assessment identifies specific areas for improvement to achieve closer alignment with international standards.
Policy implications and recommendations
- Prioritize strengthening risk management frameworks for the RTGS and securities settlement systems given their concentration and interdependencies.
- Address the areas identified in the formal assessment to improve alignment with CPMI-IOSCO principles and reduce potential risks to financial stability.
Scope and objective
- Objective: Identify potential risks related to FMIs that may affect financial stability.
- Focus: Observance of CPMI-IOSCO principles for payments and securities settlement systems in Bahrain.