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Corporate governance Authorities Matrix The Authorities Matrix which is approved by the full Board and any amendments thereto, outline matters that require specific Board / Board Committee approvals and also sets out matters that are delegated to the Executive Management. Based on materiality credit approvals above certain limits and criteria and all investment decisions are brought before the Board. Management Structure The Bank’s Organization Chart which is communicated to the CBB defines the reporting lines and segregation of duties among different departments of the Bank. Review of segregation of duties is generally part of the scope of audits conducted by the Internal Audit Department, in accordance with its annual audit plan, as an independent party Internal Audit Internal Audit provides independent and objective appraisal of all the activities of the Bank aiming to add value, improve operational efficiency, risk management and internal control systems and helps the Bank accomplish its objectives by evaluating and improving the effectiveness of risk management, control and governance process, and by providing objective analysis and recommendations to improve the Bank’s activities. Internal Audit reports to Board Audit Committee. Communication with Stakeholders The Bank uses all available avenues to communicate with its stakeholders, in line with the principle of transparency and disclosure that is integral to good corporate governance. This includes wide use of the media for the purposes of advertising and providing information on the Bank’s progress. Furthermore the Bank’s website www.bmibank.com carries updates of any significant events and regulatory directives/requirements and financial data for a minimum of three years as per the Basel II Pillar III disclosure requirements approved by the Board. The Bank’s quarterly results are published in both Arabic and English newspapers, and are posted on the Bank’s website. Copies of these releases are available on request. Code of Ethics for Business Conduct The Bank has a Code of Ethics for Business Conduct in place which was approved by the Board and this aims to provide its customers courtesy, fairness, flexibility, efficiency and professionalism and thereby upholding the image of the Bank at all times. The Bank has adopted this Code of Ethics for Business Conduct to ensure that it retains its integrity and merits, public trust and confidence by following it along with other policies and procedures of the Bank and by adhering to the letter and the spirit of all applicable laws and regulations. Related Party Transactions Bank’s policy of related party transaction is aligned with CBB guidelines on such transactions. A process is being put in place by which all related party transactions will be reported to the Board on a quarterly basis and necessary reports will form a part of the disclosures to the shareholders at the AGM. In addition, all credit proposals where any director has abstained from voting due to conflict of interest will be reported to the shareholders at the AGM. In 2011, six credit proposals were presented to the Board And Board Risk Committee, where certain members of the Board had conflict of interest, had been unanimously approved in each case by the rest of the Board members, except by the member who had conflict of interest, where they abstained from voting. Also, refer to the notes in the consolidated Financial Statements in this Annual Report. Compliance and Anti-Money Laundering The Bank is aware of its duties and responsibilities in observing all regulatory requirements in its functioning as a responsible financial institution and has an established Compliance function in place to handle it. Compliance function handles all the regulatory requirements laid down by the Central Bank of Bahrain, which also encompasses the Anti Money Laundering requirements in line with Central Bank of Bahrain's regulations. The Bank has in place a documented Compliance Manual covering all the regulatory requirements of Central Bank of Bahrain and Anti Money Laundering policy and procedure complying to Financial Crime regulatory requirements in line with the recommendations issued by FATF. [48] BMI Bank Annual Report 2011
Corporate governance Rewards Policy The Bank has a rewards and recruitment policy which deals with rewards and salary ranges for different categories of staff. The Bank distributes Director’s remuneration as per the provisions of Bahrain Commercial Companies laws. The Bank is in the process of revising its remuneration policy, for staff and Directors, in line with CBB and Ministry of Industry and Commerce (MOIC) guidelines on corporate governance. The Board Remuneration and Nomination Committee makes specific recommendations to the Board on, both the remuneration policy and individual remuneration packages for the Directors, CEO, GM and their direct reports in line with the policy guidelines The Bank operates a bonus scheme for staff that seeks to reward achievements against agreed objectives and the contributions individuals make to achieve the Bank’s goals. Bonus payments are at the sole discretion of the Bank. The Bank does not currently have a stock option plan in place. Professional Profile of the Statutory Auditors The Board recommended to the Shareholders for the reappointment of Ernst & Young, Bahrain as the statutory auditors of the Bank and the same was approved by the Shareholders by a resolution adopted at the Annual General Meeting of the Shareholders held on 12 April 2011. Ernst & Young is a professional services organization providing the professional accounting, auditing, taxation and consultancy services, with more than 141,000 personnel worldwide. They provide integrated services to private enterprises and public agencies in more than 670 cities located in more than 140 countries. The Middle East practice of Ernst & Young is an independent professional firm which has operated in the Middle East region since 1923 and is a member of Ernst & Young Global. The firm has 3,100 staff working from 17 offices in 14 Arab countries. BMI Bank Annual Report 2011 [49]
Page 1: [Growing Stronger] Annual Report 20
Page 4 and 5: [building a solid reputation for pr
Page 6 and 7: Our philosophy [OUR PHILOSOPHY] OUR
Page 8 and 9: Financial highlights 2011 [2011 Fin
Page 10 and 11: STRENGTH THROUGH Progress thanks to
Page 12 and 13: Chairman’s report [10] BMI Bank A
Page 14 and 15: Chairman’s report LOCAL MARKET Af
Page 16 and 17: Chairman’s report MANAGING RISKS
Page 18 and 19: STRENGTH THROUGH PARTNERSHIP Unbeat
Page 20 and 21: Chief executive officer’s report
Page 26 and 27: STRENGTH THROUGH VERSATILITY A rang
Page 28 and 29: Board of Directors’ profiles [boa
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Page 34 and 35: STRENGTH THROUGH efficiency develop
Page 36 and 37: Sharia Supervisory Board [Sharia Su
Page 38 and 39: STRENGTH THROUGH PRIVILEGES A commi
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Page 42 and 43: Corporate governance Term of the Bo
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Page 46 and 47: Corporate governance COMMITTEE FREQ
Page 48 and 49: Corporate governance Executive Mana
Page 52 and 53: STRENGTH THROUGH INNOVATION Save wi
Page 54 and 55: Management team [Management Team] I
Page 56 and 57: Management Discussion and Analysis
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Notes to the Consolidated Financial
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English - BMI Bank

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