On Oct. 14, OMN CB introduced new ESG requirements for banks.
OMN CB said circular issued, detailing new requirements on sustainable and green financial practises for banking sector, improving resilience to climate-related risks.
The circular applies to all locally incorporated conventional, Islamic, and specialized banks in Oman, as well as branches of foreign banks operating in the country.
Summary
Emphasizes the importance of integrating climate risk management into banks' overall operations, from governance, strategy to risk assessment, as well as disclosure
Encourages banks to voluntarily adopt wider ESG factors, for a more sustainable, resilient economy and enhance reputation, attract sustainable investors, mitigate risks.
Circular aims to align the sector with Oman's National strategy for an orderly transition to net zero sustainability efforts & long-term vision for a resilient, low-carbon economy.
Also suggests participation in sustainable finance initiatives by issuing sustainable/ green instruments, loan/credit products, making environmentally beneficial investing.
Staff training & customer education are other important areas highlighted by OMN CB.
Next Steps
Banks should assess current practise against requirements/develop an implementation plan with timelines, interim targets, milestones, and submit to CB by Jun. 30, 2025.
Requirements related to ESG governance, strategy, risk management, and additional recommendations will be effective from Jul. 1, 2026, allowing time to adjust practises.
Disclosure requirements will take effect on Dec. 31, 2026, on financial statements prepared for 2026, for consistency and accountability in climate-related reporting.
Regulators
OMN CB
Entity Types
Bank; MSB
Reference
PR, 10/14/2024; Cir 1208, 10/13/2024; ESG
Functions
Compliance; Environment; Financial; Operations; Reporting; Risk; Social
