Regulations implemented in the KSA
| Items in regulations applicable to financial institutions | Pattern of implementation of laws in the KSA |
|---|---|
| Banking system types | Dual |
| Banking laws | The operation of Islamic banks in line with the governing laws |
| Unrestricted investment account holders (UIAH) | Restricted investment accounts are only allowed having a low risk application and generating safe results |
| Disclosure requirements regarding investment accounts | No disclosure requirements developed |
| Accounting | AAOIFI's set of guidelines are complied by SAMA. However, the international accounting Standards (IAS) are also officially required to be maintained |
| Capital adequacy | Not specified |
| SSB terms of reference | Not specified |
| Composition of SSB | Not less than three qualified Muslim members |
| SSB decision making | By majority vote |
| Appointment and dismissal of the SSB | Not specified |
| Criteria to determine whether SSB is fit and proper | Not specified |
| Centralized SSB (higher Sharīʿah authority) | Centralized SSB does not exist |
| Compensation committee (required versus encouraged) | Encouraged |
| Nomination committee (required versus encouraged) | Encouraged |
| Independent and non-executive board members (required versus encouraged) | Encouraged |
| Items in regulations applicable to financial institutions | Pattern of implementation of laws in the KSA |
|---|---|
| Banking system types | Dual |
| Banking laws | The operation of Islamic banks in line with the governing laws |
| Unrestricted investment account holders (UIAH) | Restricted investment accounts are only allowed having a low risk application and generating safe results |
| Disclosure requirements regarding investment accounts | No disclosure requirements developed |
| Accounting | AAOIFI's set of guidelines are complied by SAMA. However, the international accounting Standards (IAS) are also officially required to be maintained |
| Capital adequacy | Not specified |
| SSB terms of reference | Not specified |
| Composition of SSB | Not less than three qualified Muslim members |
| SSB decision making | By majority vote |
| Appointment and dismissal of the SSB | Not specified |
| Criteria to determine whether SSB is fit and proper | Not specified |
| Centralized SSB (higher Sharīʿah authority) | Centralized SSB does not exist |
| Compensation committee (required versus encouraged) | Encouraged |
| Nomination committee (required versus encouraged) | Encouraged |
| Independent and non-executive board members (required versus encouraged) | Encouraged |
Source(s): Grais and Pellegrini (2006b), El-Hawary et al. (2007).