State Bank of Pakistan (SBP) Governor Yaseen Anwar on Thursday said that rigorous efforts were required to enhance the depth and scope of the Islamic banking industry in Pakistan.
He said this at the launch of a mass media campaign for the promotion of Islamic banking in Pakistan.
Yaseen said that with the support of the SBP, the Islamic banking industry had shown significant growth, above 30 percent annually, including 8.6 and 10 percent in terms of assets and deposits, respectively. He added that “the industry both internationally and domestically remained at an evolutionary phase”.
The governor said that modern Islamic finance had evolved into a dynamic industry, adding that it had spread to non-Muslim countries as well, and was now functioning in more than 75 countries with a network of 430 Islamic banks and financial institutions managing assets of more than $1.3 trillion.
He said that the stability and resilience of Islamic banking had resulted in a broader acceptance of this system as a viable alternative to conventional banking.
Furthermore, he said “the SBP had played a primary role in the promotion and development of Islamic banking in the country. This, by providing a comprehensive legal, regulatory, and supervisory framework in addition to remaining active in creating awareness by arranging seminars, group discussions and conferences.”
The governor said the SBP was at an advanced stage of issuing a detailed Shariah governance framework that would integrate the roles of various organs of Islamic banks, including the board of directors, the executive management and Shariah boards, to improve the overall Shariah compliance levels in these institutions.
He added that a significant proportion of Pakistanis were either unaware of Islamic banking or had some misconceptions about its functioning. The SBP had mobilised the industry to launch a nationwide mass media campaign to create awareness and to address these issues, he added.
Islamic Banking Department Director Saleemullah briefly outlined the components of the media campaign while Meezan Bank President and CEO Irfan Siddiqui highlighted the role of the SBP in promoting Islamic banking in Pakistan.
Alfalah Bank President Atif Alsam Bajwa emphasised that the industry should focus on producing quality Islamic bankers to meet the fast growing human resource needs of the industry.