Islamic Banking

From Ahmad Farizal Abdul Hajat

COLOMBO, Nov 28 (Bernama) — Sri Lanka is now well positioned to become a producer and supplier in Islamic banking and financial professionals with the newly established Faculty of Islamic Banking and Finance, International Centre for Education in Islamic Finance (INCEIF)’s chief executive officer Agil Natt said today.

He said the faculty was the first in the country and established as an affiliate between INCEIF and Sri Lanka-based Ceylinco Sussex Business School (CBS) to offer the Certified Islamic Finance Professional (CIFP) qualifications.

This, according to Agil, will develop the human capital needs for the Islamic financial services industry in Sri Lanka as well as those of neighbouring countries.

"The idea of establishing this faculty is to meet the needs of human capital, qualified in Islamic banking and finance, for the rapidly expanding global Islamic financial services industry," he said.

"Together with CBS, INCEIF hopes to drives the industry in Sri Lanka and help build up a meaningful pool of Islamic professionals, bankers and takaful operators with sound grounding of Syariah and corporate finance," he told Bernama after the signing of an agreement between INCEIF and CBS here.

INCEIF was represented by its chairman Dr Rozali Mohamed Ali and Agil while representing CBS were its chairman Dr Lalith Kotelawala and deputy chairman K.A.S. Jayatissa.

Bank Negara Malaysia’s deputy governor Datuk Mohd Razif Abdul Kadir and the Malaysian High Commissioner to Sri Lanka, Nazirah Hussain, witnessed the signing.

The agreement marked the appointment of CBS as the education provider and marketing agent for INCEIF in Sri Lanka.

The new faculty will be the latest addition of CBS, which is currently involved in producing professionals in the finance, accountancy, marketing, management and information technology fields.

Sri Lanka, with about 77 percent of its population Buddhists and Muslims constituting 8.5 percent, is one of the few non-Islamic countries to have legislations for Islamic banking.

The revised Banking Act No. 30 of 1988, amended in 2005, allows both commercial banks and specialised banks to operate on a Syariah-compliant basis.

Sri Lanka has 22 commercial banks, comprising two large state-owned banks — Bank of Ceylon and Peoples Bank — together with nine private banks and 11 foreign banks.

Their total assets as at end of July 2005 was US$11.76 billion. The two-state banks accounted for about 48 percent of the total assets while the foreign banks accounted for 14 percent.

The takaful concept in insurance is now experiencing increasing market acceptance in Sri Lanka.

The country has 13 licensed insurance companies, including a takaful operator named Amana Takaful.

According to a spokesperson for Sri Lanka’s insurance business, two of the country’s largest insurance operators have plans to offer takaful products to the market.

INCEIF was established by Bank Negara Malaysia in December 2005 to contribute towards the global development of human capital that is required to support the future growth and development of the global Islamic financial industry.

With the aim of producing high-calibre practitioners and professionals in Islamic finance as well as specialists and researchers, INCEIF has become a platform for training in this area.

– BERNAMA

With the increasing demand for Islamic banking in the country, there is a need for trained bank staff with the right qualifications to undertake Islamic banking based on Shariah principles and methodologies, said Dr Ishrat Husain, governor, State Bank of Pakistan (SBP), here on Monday.

The governor, while inaugurating the First Islamic Banking Certificate Course at the National Institute of Banking & Finance (NIBAF), Karachi Campus, said the State Bank was implementing in letter and spirit the decision of the Supreme Court regarding the Riba-free banking in the country.

He said that they would provide a level playing field for the conventional and Islamic banking in the country. Islamic banking would run parallel to the conventional banking and it is upto the people of Pakistan to choose which type of banking they would adopt, he said and added: “We need to encourage growth of genuine Islamic banking in the country.”

Dr Ishrat Husain said the State Bank had taken a number of steps for the promotion of Islamic banking in Pakistan, which included the issuance of licences to Islamic banks, Islamic banking branches and setting up of subsidiaries by commercial banks for Islamic banking

He said the State Bank had issued the Essentials and Model Agreements of Islamic Modes of Financing as recommended by the Commission for Transformation of Financial System and approved by the Shariah Board of the SBP in order to ensure observance of Shariah principles by the institutions conducting Islamic banking in Pakistan.

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