MUSCAT: The Islamic finance industry is currently valued at Dhs3.65 trillion ($1 trillion) worldwide, of which Dhs717 billion ($210 billion) is invested in the Middle East.
Following the royal decree by Sultan Qaboos Bin Said Al Said authorising Sharia-compliant financial products in Oman, International Turnkey Solutions (ITS), a global leader in Islamic banking technology solutions successfully concluded its first ‘Oman Islamic Banking Conference 2011,’ attended by over 80 banking decision makers, Islamic banking experts and financial organisations.
“Worldwide, some of the most renowned international banks use Islamic finance instruments such as sukuk (Islamic bonds) to raise funds for Sharia minded ethical investors,” said Mohamed Roushdy, Chief Information Officer, Siraj Finance, who presented an overview on migrating conventional banking structure to Sharia-compliancy.
“We believe that Islamic banking principals are ever more relevant today, given the chaos created by the financial crisis. Conducting business guided by Islamic principles, provides investors with confidence and peace of mind in today’s turbulent global marketplace.”
Dr Mabid Al Jarhi, financial expert and Head of Training, Emirates Islamic Bank, commented on the legal infrastructure required to sustain and grow Shariah-compliant finance.
He commented that the Central Bank of Oman (CBO) should look into amending its existing laws, or preparing a new draft banking law to put Islamic banks on an equal footing with conventional banks. In terms of taxation, Islamic transactions may also be taxed twice, placing them at a disadvantage.
“If these factors are in place the Islamic finance market in Oman could operate at levels that could compete with regional institutions. Funds, that have been flowing outwards, could be repatriated and foreign funds could be attracted in Oman,” Dr Al Jarhi added.
“Islamic banks need to mature operationally and make the technological investments required to be competitive on a global scale. For Oman, the future is very bright if banks here take the necessary steps required to build a solid foundation for Islamic banking,” said Dr Haroun Dharsey, Senior Vice President of Operational Projects at Dubai Islamic Bank (DIB), the UAE’s oldest Islamic bank.
“Successful Islamic banks have been able to combine operational and technological aspects of the business with Islamic practices and traditions is a leading international Islamic Banking solution provider that lives and breathes Islamic values and culture,” said Khalid Al-Saeid, Managing Director and General Manager of ITS.