• Tuesday, Oct 20, 2020
  • Last Update : 11:43 pm

Experts: Shariah governance to regain discipline in banking sector

  • Published at 08:56 pm September 20th, 2020
The rising popularity of Islamic banking finance
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The experts widely discussed the present status of the country’s banking sector and ways forward to make the sector disciplined and vibrant

Blaming poor corporate governance for the present vulnerable situation in the country’s banking sector, experts on Sunday suggested Shariah governance for improving governance in the banking sector.

They made the recommendation at a webinar titled "Islami Banking and Financing- An Emerging Need of Promoting Corporate Governance in the Banking Sector” organized by the Institute of Chartered Secretaries of Bangladesh (ICSB).

The experts widely discussed the present status of the country’s banking sector and ways forward to make the sector disciplined and vibrant.

Focusing on the weakness in the existing banking sector, ICSB president Muzaffar Ahmed said that poor corporate governance was the major cause for the current state of affairs of the banking sector.

Shariah governance could assist in improving corporate governance in the sector, said Ahmed.

He also suggested encouraging the Shariah-based banks in the country to have a mandatory Shariah board, guided by the Bangladesh Bank.

Ahmed also recommended giving the Shariah board full responsibility and power to oversee compliance of Shariah principles in every segment of a banks' operations.

On top of that, Ahmed also suggested bringing an amendment in the governance code of Bangladesh Securities and Exchange Commission (BSEC) to appoint an independent director based on expertise on a specific sector.

Meanwhile, bankers expressed that Shariah-based products would be a great source for long term funding.  

“Islamic banking system is gaining its popularity day by day. I hope that Sukkuk, an Islami product of long term finance, will get a place as a mode of long term finance in the country,” said Mohammed Haider Ali Miah, managing director and CEO, of Exim Bank Limited, who was also the chief guest.

Haider discussed the brief history and different methods of Islami products.

Md Shafiqul Alam, council member and chairman, seminar & conference subcommittee of the institute, moderated the session.

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