SBP Islamic Banking Bulletin, July-Sep 2007

Shamshad akhtar governor state bank of pakistan the

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Shamshad Akhtar Governor, State Bank of Pakistan, October 18, 2007 . The full text of the speech can be accessed at: http://www.sbp.org.pk/about/speech/governors/ dr.shamshad/2007/Islamic-Finance-25-Oct-07.pdf Islamic Banking Bulletin gives an overview of the Islamic Banking Industry of Pakistan and provides information regarding the developments taking place in the industry locally and internationally. Vol II No 3 Published on February 06, 2008 Dr. Shamshad Akhtar appointed as the Chairperson of the IFSB Council The Council of the Islamic Financial Services Board (IFSB) has resolved to appoint H.E. Dr. Shamshad Akhtar, Governor of the State Bank of Pakistan as the Chairperson of the IFSB Council for a one year term effective 1st January 2008. Dr. Shamshad is the 5th Chairperson of the IFSB Council, and Karachi is hosting the IFSB General Assembly and Council Meetings in 2008.
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July-September 2007 Page 2 Industry Progress and Market Share The State Bank of Pakistan has formed a com- prehensive regulatory framework aimed at the establish- ment and promotion of an Islamic banking system in line with best international practices. These measures are pri- marily demand-driven and provide an option to the cus- tomers to choose between the two banking systems in accordance with their preference. As a first step, a three-pronged strategy was laid out for the promotion of Islamic Banking in Pakistan which allows financial institutions, to decide at their dis- cretion, to establish either full-fledged Islamic banks in the private sector; or Islamic Banking subsidiaries or stand alone Islamic Banking branches of the existing commercial banks. This is in sharp contrast to the earlier attempt, when Islamic Banking was required to be imple- mented by all banks across the board. As on December 31, 2007 there were six full fledged licensed Islamic banks having 185 branches. In addition, 12 commercial banks are offering Islamic bank- ing services through 103 branches. The increasing inter- est of conventional banks in opening Islamic branches and applications for opening full-fledged Islamic banks show the promising future prospects for the growth of Islamic banking in Pakistan Islamic banking services in Pakistan have recorded a noteworthy progress during the quarter under review constituting an asset base of Rs. 178 billion and deposits of over Rs. 124 billion at end September, 07 as compared to Rs. 159 billion and Rs. 108 billion respectively at the end of June 07. Although, due to its nascent stage of de- velopment, the share of the Islamic Banking industry in the total assets (3.8%) and total deposits (3.6%) of the banking sector remains miniscule, it is expected that this share will grow considerably in the years to come. - 20 40 60 80 100 120 140 160 180 Rs in Bn. Sep- 07 Jun- 07 Dec- 06 Dec- 05 Dec- 04 Dec- 03 Years Islamic Banking- 2003 To 2007 Total Assets Deposits Financing. & Invest.
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