To: All Licensed Banks and Financial Institutions

Subject: Corporate Governance of Banking and Financial Institutions

Pursuant to Article 14(O) of Oman Law No. 7/1974, Article 53 of Oman Law No. 7/1974 and Article 77 of Oman Law No. 7/1974 issued by Oman Sultani Decree No. 114/2000 and in accordance with the Oman Decision No. BOG/1463/115/9/01/5/2001 of the Board of Governors of the Central Bank, adopted at its meeting held on 23/9/2001, the following has been decided:

1. Purpose Of This Circular

   To lay down principles of demarcation between the role, responsibility and accountability of Board of Directors and that of Management in Banks and other Financial Institutions incorporated within the Sultanate of Oman and licensed by the Central Bank referred to hereinafter as Licensed Institutions.

2. ROLE & RESPONSIBILITY OF BOARD OF DIRECTORS

   a) Policy formulation: