He was speaking at the concluding session of a three-day workshop jointly organised by the SBP and the Islamic Financial Services Board (IFSB) here on Wednesday.
Yaseen Anwar said that despite the current global financial crisis, the Islamic funds world-wide are 'considerably liquid.' He said that this liquidity can be effectively utilised to increase the penetration of Islamic banking not only in Pakistan but elsewhere in the world, too.
The SBP deputy governor highlighted the importance of having a comprehensive framework of Risk Management, Corporate Governance and Supervisory Review Process for the Islamic banking institutions. He said that the SBP has played a key role in providing a healthy environment and A-level playing field to the Islamic banking industry with the provision of a comprehensive regulatory and supervisory framework. "Shariah-compliant mechanism introduced by SBP is the most comprehensive available across the world," he said, adding that Pakistan is the only country, which has issued Guidelines on Islamic agriculture and micro-finance.
Similarly, SBP is the first central bank to have initiated Shariah-compliant inspection mechanism, he pointed out. Anwar said that as a result of SBP's initiatives, the Islamic banking industry in Pakistan has experienced robust growth in recent years. SBP's recent achievement of being ranked as the second best central bank at international level in promoting Islamic banking is a reflection of this effort, he concluded.
He said the State Bank's next five-year strategy for development of Islamic banking industry envisages adopting various international prudential standards developed by IFSB as an important pillar.
"We have accordingly seized the opportunity by capitalising on IFSB's expertise through holding such workshops at this juncture," he said. In addition, he declared that adaptation of IFSB standards in the country would enable Islamic banking institutions to perform an equal footing with the conventional banking industry.
Anwar appreciated the role of the IFSB in preparing various standards and said that international practices are developed through an exhaustive process based on research, discussions, public hearings, workshops/seminars etc.
The workshop was widely participated by the entire local industry and IFSB speakers of international repute shared their wisdom and experiences with the industry players. The workshop proved useful for enhancing the exposure of the industry.