Jan 21 2013

More Islamic windows on anvil

By Kabeer Yousuf MUSACT -- Capitalising on the modern business mantra of Islamic Banking, more and more banks are coming up with their Islamic windows, according to the Central Bank of Oman (CBO).

However, the number of full-fledged Islamic banking bodies will be confined to just two key players, as is said by Hamood Sangour al Zadjali, Executive President of the CBO.

"We have given permission to two full-fledged banks to operate in the country, which are Bank Nizwa and Alizz Islamic Bank. The earlier one has already begun operations while the latter is in the process of opening their offices in the country."

The number of banks with Islamic banking windows is currently six with Bank Muscat, NBO, Ahlibank being the key players while a number of other banks have shown interest in opening their Islamic Windows as part of diversifying their banking activities.

"While six Omani banks are given permission to begin Islamic Windows, all other banks have shown interest in the same except HSBC Oman at the moment", the representative of the apex banking regulatory authority in Oman said.

He said that there will be only two full-fledged banks for the time being and the CBO will see the results and will decide upon permission to further applications accordingly.

"I'm sure they will be meeting the current market demand and will serve the public in a better way. The conventional banks will be working in harmony with Islamic banks each other while a healthy competition can be felt among them and we are sure that the public will be benefitting from the various products and services offered by these banks", CBO Executive President said.

In pursuance to the Royal Decree 69/2012 which amended the Banking Law 2000, the Central Bank of Oman has issued the much awaited Islamic Banking Regulatory Framework (IBRF) which covered all aspects of Islamic banking.

Issuing the Circular IB-1, the first ever under the head Islamic banking, the CBO communiqué revealed that the IBRF document has been categorised under different titles and all issues concerning with Islamic banking such as the info on licensing requirements, the general obligations and Governance, the accounting standards and auditor reports, the powers of supervision and control, the capital adequacy, the credit risks, the market risks, the operational risks, the liquidity risks and miscellaneous can be obtained in the document.

© Oman Daily Observer 2013

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