Challenges for Islamic Banking in Oman
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Transcript of Challenges for Islamic Banking in Oman
Challenges for Islamic Banking
in Oman
Strength of Islamic Banking in Oman Legal Reforms Products Development Pioneer of Islamic Banking
AGENDA
Strength of Islamic Banking in Oman
CBO’s Objectives
Credible Banking
Proposition
Customer Protection
Efficient Mobilization of
Capital
Effective Regulatory Oversight
Inclusion of Shariah Sensitive Market Segment
Compliance with International Best Practices
Components of IBRF
Licensing Requirements •Capital Allocation•Set up/ Policy requirements
Sharia Governance Framework
•SSB / Sharia Reviewer•Fit & Proper criteria
Window Model •Bank within bank•Direction for business, control & support units
Risk Management •Capital adequacy ratio•Liquidity Management
Accounting & Reporting Framework
•AAOIFI standards•IFRS conflict disclosures
Challenges of Islamic Bankingin Oman
Funds Segregation Challenge
CBO Framework
Sharia Framework
Business Ethics
Corporate Governance
Fundamentals
Funds Segregation Assurance
IT System Separate Book
External/ Regulator’s
Audit
Funds Segregation
Policies
IIFM, AAOIFI & IFSB
Sharia Inspection
ALM Guidelines
S y s t e m a n d C o n t r o l s
Government patronage and regulatory reforms can play a pivotal role for the development of Islamic banking like taxation benefits
Provision in Commercial codes for Islamic Banking to ensure enforceability of contract in courts like trust laws, beneficial ownership
Level playing field between Islamic and conventional banks in term of products commercial viability e.g. double taxation issues
Sharia Compliance Re-assurance via Centralized Sharia Board
Challenge of Regulatory Reforms
Need of standardization of contracts for Islamic products. Public perception management Lack of Research and Development efforts Next Generation of Islamic banking products instead of
mimicking conventional banking
Challenges in Product Development
Pioneer of Islamic Bankingin Oman
Started operations in 2008 First mortgage product of Oman Total portfolio is over RO 90 Mio Total Meethaq customers are over 2000 Majority of the customers are first time
borrowers Pioneer of Islamic Banking in Oman
Meethaq Home Finance
Market Leadership Initiatives
Support to CBO/CMA Ifta
Office
First Product in Oman
Public Awareness Programs/ Facebook
Initiatives on MM & CM
Thank You