Assets of Islamic banks double from Rs837b to Rs1.6t
Regulator considering amending laws, giving tax relief
ILLUSTRATION: JAMAL KHURSHID
KARACHI:
Assets of Islamic banks have doubled in the last four years and the apex regulator is now considering amending laws and giving tax relief to enable them to issue sukuk and real estate investment trust.
“The assets in Islamic banking {in Pakistan} have doubled from 2012 to 2016, jumping from Rs837 billion to Rs1.6 trillion, now accounting for 11.7% of the total banking assets,” Securities and Exchange Commission of Pakistan (SECP) said in a handout on Saturday.
There is an even stronger growth of Islamic assets in the non-bank financial institutions (NBFI). Their market share is now approaching 33% from only 14% in 2012.
Islamic finance body drafts new standard for centralised sharia boards
“Two reasons that help explain this growth are demand from customers and enabling regulations by the SECP and the State Bank of Pakistan (SBP),” it said.
Speaking at a seminar at SECP’s head office, Usman Hayat, head of the Islamic Finance Department at the SECP, explained that developing Islamic capital market is a priority of the regulator. “The SECP has recently conducted two consultation sessions with market participants to facilitate issuance of sukuk and real estate investment trust (REIT),” he said.
“The SECP is analysing industry proposals and it shall consider making appropriate amendments to the relevant regulations, further reducing the cost and hassle for both issuers and investors. The industry proposals pertaining to tax issues regarding sukuk and REIT are being referred to the FBR,” he added.
Ghulam Muhammad Abbasi, head of the Islamic Banking Department at SBP, said 21 banking institutions are offering Islamic banking services in the country through 2,322 branches in 112 districts across the country at present. “The SBP has a holistic approach to the promotion of Islamic banking and is providing enabling policy environment, Sharia governance, risk management, and capacity building,” he said.
He pointed out that the SBP was voted as the ‘best central bank for promoting Islamic finance’ by Islamic Finance News in 2015.
Published in The Express Tribune, March 5th, 2017.
Assets of Islamic banks have doubled in the last four years and the apex regulator is now considering amending laws and giving tax relief to enable them to issue sukuk and real estate investment trust.
“The assets in Islamic banking {in Pakistan} have doubled from 2012 to 2016, jumping from Rs837 billion to Rs1.6 trillion, now accounting for 11.7% of the total banking assets,” Securities and Exchange Commission of Pakistan (SECP) said in a handout on Saturday.
There is an even stronger growth of Islamic assets in the non-bank financial institutions (NBFI). Their market share is now approaching 33% from only 14% in 2012.
Islamic finance body drafts new standard for centralised sharia boards
“Two reasons that help explain this growth are demand from customers and enabling regulations by the SECP and the State Bank of Pakistan (SBP),” it said.
Speaking at a seminar at SECP’s head office, Usman Hayat, head of the Islamic Finance Department at the SECP, explained that developing Islamic capital market is a priority of the regulator. “The SECP has recently conducted two consultation sessions with market participants to facilitate issuance of sukuk and real estate investment trust (REIT),” he said.
“The SECP is analysing industry proposals and it shall consider making appropriate amendments to the relevant regulations, further reducing the cost and hassle for both issuers and investors. The industry proposals pertaining to tax issues regarding sukuk and REIT are being referred to the FBR,” he added.
Ghulam Muhammad Abbasi, head of the Islamic Banking Department at SBP, said 21 banking institutions are offering Islamic banking services in the country through 2,322 branches in 112 districts across the country at present. “The SBP has a holistic approach to the promotion of Islamic banking and is providing enabling policy environment, Sharia governance, risk management, and capacity building,” he said.
He pointed out that the SBP was voted as the ‘best central bank for promoting Islamic finance’ by Islamic Finance News in 2015.
Published in The Express Tribune, March 5th, 2017.