Financial Institution Law 2012, Chapter I, Article 2 “Commercial bank” means any bank in Somalia whose business includes the Acceptance of deposits withdrawable by cheque, issue of short term and medium-term loans, guarantees, foreign exchange transactions and such other activities as the Central Bank may by regulation classify.
Financial Institution Law 2012, CHAPTER II, Article 1 A person who intends to engage in banking business in Somalia must first obtain a license issued by the Central Bank.
Financial Institution Law 2012, CHAPTER III, Article 4 An application for bank license shall be made in writing in the form prescribed by the Central Bank of Somalia. The application must be accompanied by all required supporting information and documents, and the prescribed application fee. In addition to that The Central Bank may require any other information from the applicant, shareholders, significant shareholders, directors, officers and/or third parties that it deems necessary to complete its assessment of a bank license application.
Financial Institution Law 2012, CHAPTERI II, Section 14 Article 1, 2 and Section 15 (1), Section 16, and Bank Resolution on 31st December 2017 Central Bank of Somalia requires all commercial banks should maintain Minimum Capital Requirements of 7,000,000 in which 1,500,000 deposit at Central Bank of Somalia and maintain all time a Capital Adequacy Ratio which equals or exceeds twelve percent (12%) and a Core Capital Ratio which equals or exceeds eight percent (8%). A liquidity ratio which equals or exceeds twenty (20%) is also required.
Financial Institution Law 2012, CHAPTER 9 Section 67 Article 1, Central Bank of Somalia requires that no person or group of related person’s shareholders of licensed commercial banks direct or indirect owns or controls more 25%.