|Peninsula On-line - Islamic banks
survive crisis: IFSB official
Source ::: The Peninsula
banks have demonstrated relative resilience to the global financial crisis but they can be affected like any
other financial institution if the crisis continues, according to an Islamic finance expert.
Talking to The Peninsula on the sidelines of the Qatar Law Forum yesterday, Professor Refaat Abdel Karim,
Secretary-General of the Islamic Financial Services Board (IFSB) based in Malaysia said, “Islamic banks have
survived the crisis because they prohibited to participate in toxic assets. However, since the financial crisis
have transformed into an economic crisis, these banks can also be affected, like any other financial
He said there was an increased demand for Islamic financing after the global
crisis. However to present itself as a global alternative, Islamic financing need to develop a legal
infrastructure and liquidity infrastructure. He added that the IFSB had been working towards achieving this
The IFSB serves as an international standard-setting body of regulatory and
supervisory agencies in Islamic financial services industry, that include banking, capital market and
insurance. The Board promotes the development of a prudent and transparent Islamic financial services industry
through introducing new, or adapting existing international standards consistent with Shari’ah principles, and
recommend them for adoption.
The 178 members of the IFSB include 42 regulatory and
supervisory authorities as well as International Monetary Fund, World Bank, Bank for International Settlements,
Islamic Development Bank, Asian Development Bank and the Islamic Corporation for the Development of Private
Sector, Saudi Arabia, and 130 market players and professional firms operating in 34 jurisdictions.
Malaysia, the host country of the IFSB, has enacted a law known as the Islamic Financial
Services Board Act 2002, which gives the IFSB the immunities and privilege
The IFSB is
actively involved in the promotion of awareness of issues that are relevant or have an impact on the regulation
and supervision of the Islamic financial services industry. This mainly takes the form of international
conferences, seminars, workshops, trainings, meetings and dialogues staged in many countries.