Risk Committee

Purpose 

The Board of Directors has established a Board Risk Committee to review matters related to the overall risk management of the Bank, including but not limited to business risk, credit risk, market risk, operational risk, legal risk, and reputational risk, and to provide recommendations when necessary.

Composition of the Committee 

The Committee is formed and authorized by the Board of Directors in accordance with the Bank’s Articles of Association and other relevant regulations. The Committee consists of at least three members elected from among the Members of the Board of Directors, provided that they do not have executive duties. The Committee may invite the Bank’s executives to its meetings and take their opinions as it deems necessary. Any resources and support the Committee needs to carry out its duties are provided by the Board of Directors.

Functions of the Committee 

• Evaluating all risks that the Bank is exposed to, including but not limited to credit risk, market and liquidity risk, operational risk, forming the Committee’s opinion and sharing it with parties within the Bank that the Committee deems appropriate, 
•  Reviewing risk reports as well as other reports showing the bank’s overall risk levels,
• Evaluating the risk policies and related standards, the methodologies and models used in the measurement and management of risks throughout the bank, 
•  Evaluating the Bank’s comprehensive Risk Appetite Policy, including credit risk, market risk and operational risk, 
• Evaluating risk-related issues raised by other Board Committees and forming and sharing the Committee’s opinion with them, 
•  Reviewing and advising risk tolerance levels and portfolio concentration limits, including limits associated with business sector, geography, asset quality and other considerations, 
• Contributing to the compliance and implementation of strategies and policies approved by the Board of Directors, 
• Working with the Board of Directors to ensure that the Bank’s strategy, liquidity and capital plans are consistent with the Risk Appetite Policy and that its significant risks are included in the Bank’s strategy plan, 
• Negotiating the Bank’s significant risks collectively and for each risk type on a regular basis, 
• Regularly review the impact of risks on capital, revenues and liquidity under normal and stressful conditions, 
• Ensuring that the main risk issues are reported to the Audit Committee and the Board of Directors in an effective and timely manner, and to follow up that the corrective action is taken by the Bank’s management in a timely and appropriate manner, 
•  Contributing to compliance with international standards and best practices, especially with local legislation on Risk Management,
• To ensure the effective management of all risks, including emerging ones, there must be strong communication and coordination between the Committee and the Audit Committee. This will streamline the exchange of information and support the necessary updates to the Bank’s risk governance framework.
   

Working Principles of the Committee 

The committee convenes as often as required by the task assigned to it, provided that it convenes at least twice a year. The Committee Chairman invites the Committee members to the meeting through the Committee Secretariat. The Committee may hold its meetings physically at the Bank’s headquarters, at an alternative location designated by the Committee Chairman, or virtually. Committee members intending to join the meeting virtually must inform the Committee Chairman and/ or Committee Secretary in advance to facilitate the necessary logistical arrangements. The committee convenes with the majority of the total number of members and delivers a resolution with the affirmative vote of the majority of the members present at the meeting. In the calculation of the quorum, fractional/decimal numbers are rounded up to the nearest whole number. The Head of Risk Management is a permanent participant in the Committee meetings, without holding a membership status.