CBK tightens oversight; banks must seek approval before naming compliance officers

2026-03-15 - 06:16

The Central Bank of Kuwait (CBK) has instructed local banks to obtain prior regulatory approval before appointing a candidate to the position of Compliance Officer, as part of broader measures aimed at strengthening transparency and combating financial crimes. The directive requires banks to submit a formal request to the central bank for approval of the nominated candidate, in accordance with Article 68 of Law No. 32 of 1968, which governs banking operations and regulatory oversight in the country. The Compliance Department is considered one of the fundamental pillars ensuring the integrity of banking operations. It plays a crucial role in confirming that financial institutions adhere to local and international regulations while reinforcing principles of transparency, governance, and risk management, reports Al-Rai daily. In banks, compliance departments are responsible for ensuring adherence to regulations issued by the Central Bank of Kuwait, as well as instructions from the Capital Markets Authority and the Kuwaiti Financial Intelligence Unit. Their responsibilities also extend to international regulatory frameworks, particularly those related to combating money laundering and terrorist financing. According to the central bank, the qualifications and experience required for such senior positions are determined under the provisions of the Monetary and Central Bank Law and the regulations governing the banking profession. These rules classify senior positions such as deputy or assistant heads of executive bodies as roles responsible for critical banking functions, including credit operations, investment activities, treasury management and other key financial services. Furthermore, regulatory instructions require each local bank to establish an independent anti-money laundering and counter-terrorism financing department and appoint a qualified compliance officer responsible for ensuring the bank’s adherence to Law No. 106 of 2013 and its executive regulations. The appointed officer must also ensure compliance with relevant ministerial decisions and CBK directives related to financial crime prevention. Authorities stressed that candidates for this role, as well as staff within the compliance department, must possess appropriate qualifications and professional experience in anti-money laundering and counter-terrorism financing. Given the strategic importance of the role, the central bank emphasized that banks must secure advance approval before filling the position, reinforcing regulatory oversight of key governance roles within the banking sector.