06 May 2012
Muscat: Sukuks, the fastest emerging alternative instruments and capital markets tool, will be issued by the government if they are inclined to do so, said Hamoud Sangour Al Zadjali, the executive president of the Central Bank of Oman. Speaking to the media after the inaugural session of the workshop on 'Islamic liquidity management and capital market' conducted by BankMuscat Meethaq yesterday.
"We are thinking about what we can do to making availability of liquidity instruments through the banks. Currently, there are no instruments available, but may be in future there will issuance of sukuks through the government. Well, it is up to the Islamic banks and windows to be very creative and to make instruments available in line with the Sharia requirements," Sangour said.
It may be recalled that the year 2010 saw a revival in global markets, mainly due to government incentives which also resulted in a positive effect on the Islamic financial markets. It is clear that sukuk issuance in 2010 has returned to a pre-crisis issuance levels with global sukuk issuance amounting to over $45 billion, largely owing to domestic sukuk issuances in Malaysia.
On the current status of Islamic banking in Oman, Sangour said; "We have issued licences to two banks. Bank Nizawa has floated the 40 per cent of its share in the market and now are in the process of collecting the capital from the public while the founders have already put in their capital, so Bank Nizwa is starting with a capital of RO150 million and by May 22 they will be closing the IPO. Once they have the capital and once the legislative decree is announced on Islamic banking, Bank Nizwa can start rolling out the Islamic banking activities. We hope that by August this year it will start functioning."
"The second Islamic bank, Al Izz Bank is also in the process of floating their 40 per cent of their share in the market and they are waiting for the first bank to complete the public offerings. The Islamic windows of the existing banks are also going to start working as soon as we issue them licences and these licences will be issued as soon as we have the decree in place. Our banking law currently does not cover Islamic banking and so we are going to add a chapter in our existing banking laws which will form the legal framework for Islamic banking and we hope that the decree will be issued soon as it is being discussed at the official level and any time the decree will come out. Once the decree comes out then we will issue proper licences," added the CBO chief.
AbdulRazak Ali Issa, chief executive, BankMuscat, also spoke on the occasion while Sulaiman Al Harthy, Group General Manager, Islamic banking, Bank Muscat Meethaq outlined the agenda for the workshop.
Abdul Khader Thomas, CEO, Shape Financial, Kuwait spoke on the evolution, journey, growth, trends and future direction of Islamic financial services industry.
Muscat: Sukuks, the fastest emerging alternative instruments and capital markets tool, will be issued by the government if they are inclined to do so, said Hamoud Sangour Al Zadjali, the executive president of the Central Bank of Oman. Speaking to the media after the inaugural session of the workshop on 'Islamic liquidity management and capital market' conducted by BankMuscat Meethaq yesterday.
"We are thinking about what we can do to making availability of liquidity instruments through the banks. Currently, there are no instruments available, but may be in future there will issuance of sukuks through the government. Well, it is up to the Islamic banks and windows to be very creative and to make instruments available in line with the Sharia requirements," Sangour said.
It may be recalled that the year 2010 saw a revival in global markets, mainly due to government incentives which also resulted in a positive effect on the Islamic financial markets. It is clear that sukuk issuance in 2010 has returned to a pre-crisis issuance levels with global sukuk issuance amounting to over $45 billion, largely owing to domestic sukuk issuances in Malaysia.
On the current status of Islamic banking in Oman, Sangour said; "We have issued licences to two banks. Bank Nizawa has floated the 40 per cent of its share in the market and now are in the process of collecting the capital from the public while the founders have already put in their capital, so Bank Nizwa is starting with a capital of RO150 million and by May 22 they will be closing the IPO. Once they have the capital and once the legislative decree is announced on Islamic banking, Bank Nizwa can start rolling out the Islamic banking activities. We hope that by August this year it will start functioning."
"The second Islamic bank, Al Izz Bank is also in the process of floating their 40 per cent of their share in the market and they are waiting for the first bank to complete the public offerings. The Islamic windows of the existing banks are also going to start working as soon as we issue them licences and these licences will be issued as soon as we have the decree in place. Our banking law currently does not cover Islamic banking and so we are going to add a chapter in our existing banking laws which will form the legal framework for Islamic banking and we hope that the decree will be issued soon as it is being discussed at the official level and any time the decree will come out. Once the decree comes out then we will issue proper licences," added the CBO chief.
AbdulRazak Ali Issa, chief executive, BankMuscat, also spoke on the occasion while Sulaiman Al Harthy, Group General Manager, Islamic banking, Bank Muscat Meethaq outlined the agenda for the workshop.
Abdul Khader Thomas, CEO, Shape Financial, Kuwait spoke on the evolution, journey, growth, trends and future direction of Islamic financial services industry.
© Times of Oman 2012
