The Central Bank of Oman (CBO) has proposed amendments to the country’s banking law to the concerned authorities to provide for the conduct of Islamic banking and we look forward to early finalisation, Hamood Sangoor Al Zadjali, CBO executive president said yesterday.
On its part, the CBO has also formulated a draft Islamic Banking Regulatory Framework which will provide a comprehensive working platform/unique model based upon sound and best practices, he added.
Addressing delegates at the Oman Islamic Banking and Finance Conference which kicked off yesterday organised by OITE, Sangoor said, “Islamic banking builds a stable and secure economy by promoting productive/economic activities. It is not built on thin air and does not revolve around money and is real asset-and project-oriented. Many analysts observe that the fall-out from recent financial crisis had been less on Islamic banking institutions and portfolios than others. This highlights the relevance of Islamic banking to healthy growth.
“For countries like Oman requiring to encourage diversification of the economy, promoting large projects, providing gainful employment and entrepreneurship, bringing in investible surplus locally and from abroad, Islamic banking shall be very relevant. We can look forward to stable and secure economy indeed,- he said.
The CBO chief added, ‘Islamic finance, as we are all aware of, recognises and is built on meeting economic needs. There are no conflicts seen in vis-Ã -vis the economy as a whole and this is the quintessence of Islamic banking based upon Sharia.
Relying upon sound ethical principles like meeting the economic requirements of the needy, sharing fruits and failures of productive efforts and not going by profit per se, avoiding forbidden characteristics and practices revolving around uncertainty, speculation, exploitation and harmful associations, Islamic finance automatically works towards a stable and secure economy.-
“Through moderation and disclosure of sanctity of contracts, fairness is ensured, excesses are sought to be avoided, healthy growth is facilitated and safety and security are strived for. Islamic banking builds a stable and secure economy by promoting productive/economic activities,- he further said.
Important role of MSM
Ahmed bin Saleh Al Marhoon, director-general, Muscat Securities Market (MSM), spoke on the important role of MSM in the sustainable development of Islamic banking and finance in Oman. He said, “Islamic banking will occupy a good place in the commercial sector, and will help marketing and maximising request in the MSM.
He also said the practice of Islamic bank in Oman will create some sort of competition between Islamic banking and the commercial banks in customer service, which will be reflected in an agreement to improve the performance of services and reduce cost. Earlier, Ahmed Saleh Babood, executive chairman, OITE, welcomed the participants.