Speaking at the opening session of the Islamic Finance News, Pakistan — Road Show on Islamic Banking, held at the State Bank on Tuesday, SBP Governor Yaseen Anwar said this plan lays down the future roadmap of the industry, highlights areas of improvement in legal, regulatory and taxation environments, emphasises diversification of products and markets covering non-traditional, but strategically important sectors of agriculture and SMEs and increasing Islamic banking market share to over 15pc of the country’s banking system during the next five years.
Mr Anwar said Islamic banking in Pakistan has witnessed significant
growth during the last decade and now constitutes over 10 per cent of
the country’s banking system with an asset base of over Rs900 billion
and a network of more than 1100 branches.
“This expansionary trend is likely to continue and the industry is well set to double its market share by 2020,” he said.
The governor said that to further improve the Shariah compliance
environment in IBIs, SBP’s Islamic Banking Department has completed
industry consultations on the draft Shariah Governance framework and
would soon be issuing the same.
The SBP has also played a vital role in raising awareness and building capacity of the industry.
To address the awareness and misconception issues, the SBP launched
an awareness campaign that consists of seminars, conferences, targeted
programmes and focused discussions for the business community, academia,
bankers, and policy makers.
A recent significant milestone is the launch of a mass media campaign
where the whole Islamic banking Industry joined hands under the ambit
of SBP to target the challenge of misconceptions related to the Islamic
banking business model and practices.
Mr Anwar emphasised the critical importance of investment in research
and development particularly for the evolving sectors of Islamic
The research and development is also needed to develop solutions for
bringing monetary and fiscal policies and practices in conformity with
The strategic plan for the next five years envisages a number of such
initiatives and expressed the hope that the collaborative efforts by
the regulator and practitioners would be instrumental in improving
investment in R and D and developing better solutions for serving the
financing needs of the real economy, he added.
He said the unprecedented growth of the Islamic finance industry can
be associated to efforts of dedicated regulatory, Shariah, and academic
institutions along with the presence of diversified players in the
field, ie, Islamic banks, investment banks, takaful companies, Islamic
fund management companies, and Islamic brokerage companies.