Along with Islamic banking windows within commercial banks in Oman, the two new specialised Islamic banks would be able to start Sharia-compliant banking activities from early next year, according to the apex bank.
Both Bank Nizwa and Al Izz International Bank, which have got licences to operate as full-fledged Islamic banks, are expected to float initial public offerings (IPO) by the end of this year to list on the Muscat Securities Market (MSM).
Speaking to Muscat Daily, H E Hamood Sangour al Zadjali, executive president of the Central Bank of Oman (CBO), said that the two new banks are taking shape and are likely to take three to four months to be established in the market.
"I think before the end of this year both new banks will come up with IPOs so that they can start operations early next year. Other banks will be allowed to open Islamic banking windows simultaneously."
H E Zadjali was speaking at a workshop on 'Islamic Finance and Banking' organised by Horwath Mak Ghazali, a business consulting firm, on Tuesday at Crowne Plaza Muscat. H E Zadjali said that the rollout of Islamic banking will be gradual as the banks need to do a lot of ground work before the launch.
"Banks are required to establish separate offices and keep separate accounting standards and balance sheets. All the banks will have to ensure that conventional and Islamic assets and liabilities are not mixed up. It is important to ensure that Islamic financial activities are fully compliant with Sharia laws."
He added that the CBO is studying the possibility of amendments to the existing banking laws to make them suitable for Islamic banking. "We looked at our existing banking laws and found it very comprehensive. Islamic banking could come under the parameters of these laws. But we are also studying if there would be any need for amendments."
© Muscat Daily 2011
