Saudi Arabia’s King Salman bin Abdulaziz Al-Saud has approved the new Saudi Central Bank Law, which includes changing the name of the Saudi Arabian Monetary Authority (SAMA) to the Saudi Central Bank, with direct reporting to the King.
The Saudi Central Bank will continue to enjoy financial and administrative independence. This approach comes in line with international best practices for central banks. The law also stipulates that the Saudi Central Bank shall replace the Saudi Arabian Monetary Authority in all its rights and obligations.
The new law identifies the objectives of the Saudi Central Bank as follows:
• Maintaining monetary stability.
• Promoting the stability of, and enhancing confidence in, the financial sector.
• Supporting economic growth.
In addition, the law confirms that the Saudi Central Bank is responsible for setting the monetary policy and choosing its instruments and procedures. It explains the relationship of the Saudi Central Bank with the government as well as relevant international entities. Moreover, it updates the governance framework of the Saudi Central Bank's operations and decisions.
According to the new law, the Saudi Central Bank will continue to use the acronym "SAMA" due to its historic significance and relevance locally and globally. The banknotes and coins of all denominations bearing the name of the Saudi Arabian Monetary Authority will remain in circulation and keep their status as legal tender.
The Governor of the Saudi Central Bank, Dr Ahmed A. Al-Kholifey said that SAMA studied closely international best practices in the area of central bank laws as well as relevant recommendations. Such practices and recommendations were tested to ensure their compatibility with the local environment and the Saudi economy.
The Saudi Central Bank Law came as a result of the project of updating the Charter of the Saudi Arabian Monetary Authority. The new law enhances the role of the Saudi Central Bank, meets today's requirements, keeps pace with the rapid global economic and financial development, and is in line with the Saudi Vision 2030 that aims to make the Kingdom of Saudi Arabia an exemplary and leading nation in all aspects.
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