General Information & Client Service
  • Americas: +1.212.553.1653
  • Asia: +852.3551.3077
  • China: +86.10.6319.6580
  • EMEA: +44.20.7772.5454
  • Japan: +81.3.5408.4100
Media Relations
  • New York: +1.212.553.0376
  • London: +44.20.7772.5456
  • Hong Kong: +852.3758.1350
  • Tokyo: +813.5408.4110
  • Sydney: +61.2.9270.8141
  • Mexico City: +001.888.779.5833
  • Buenos Aires: +0800.666.3506
  • São Paulo: +0800.891.2518
June 20, 2017

IMF published a staff report that presents country experiences (in the form of case studies) with reforms to strengthen regulatory oversight of the Islamic banking sector. The report reviews experiences with, and the progress made, in adapting prudential, safety nets and resolution frameworks to the specifics of Islamic banking. The countries, for which detailed case studies have been undertaken, are Bahrain, Djibouti, Indonesia, Kenya, Kuwait, Malaysia, Nigeria, Pakistan, Sudan, Turkey, and the United Kingdom.

This background paper is a supplement to the board paper on “Ensuring Financial Stability in Countries with Islamic Banking (IB) Sectors.” This assessment is expected to help identify common challenges that these countries face in reforming their regulatory frameworks and to distill best practices. The case studies broadly analyze the following information:

The scale, structure, and growth of the Islamic finance industry, to give an indication of the significance of the Islamic banking sector in the financial industries of the various countries

The corporate and balance sheet structures of the Islamic banks, to help identify financial stability risks that the Islamic banks are exposed to, including both standard banking risks and risks that are unique to the sector

The regulatory, governance, and supervisory frameworks as well as the supporting financial infrastructure for liquidity management, effective resolution, and deposit insurance, to provide insights on the extent to which countries have adapted their frameworks to the specifics of Islamic finance, to address the identified stability risks

Policy options and lessons for reform

 

The case studies highlight important, but uneven, progress in adapting the legal, regulatory, and supervisory frameworks to the specificities of Islamic banking. Shari’ah governance frameworks have been established in most countries and there has been an increase in the number of countries adopting centralized Shari’ah boards, albeit from a low base. Meanwhile, progress in adapting the prudential, consumer protection, liquidity management, safety nets, and resolution frameworks remains uneven across countries. Bahrain and Malaysia have made the most advances in systematically adapting their policy frameworks to Islamic finance, in line with standards issued by the Islamic Financial Services Board and the Accounting and Auditing Organization for Islamic Financial Institutions.

 

Related Link: Staff Report (PDF)

Keywords: International, IMF, Banking, Islamic Banking, Shari'ah, Financial Stability, Regulatory Reforms

Related Insights
News

EBA Finalizes Guidelines on the STS Criteria in Securitization

EBA published the final guidelines that provide a harmonized interpretation of the criteria for a securitization to be eligible as simple, transparent, and standardized (STS) on a cross-sectoral basis throughout EU.

December 12, 2018 WebPage Regulatory News
News

OSFI Sets Domestic Stability Buffer for D-SIBs at 1.75%

OSFI set the level for the Domestic Stability Buffer at 1.75% of total risk-weighted assets, as calculated under the Capital Adequacy Requirements (CAR) Guideline.

December 12, 2018 WebPage Regulatory News
News

FSI Publishes Paper on Proportionality in Insurance Solvency Rules

FSI published a paper on proportionality in the application of insurance solvency requirements.

December 11, 2018 WebPage Regulatory News
News

BCBS Updates Framework for Pillar 3 Disclosure Requirements

BCBS published the updated framework for Pillar 3 disclosure requirements.

December 11, 2018 WebPage Regulatory News
News

EBA Issues Revised List of Validation Rules for Reporting

EBA revised the list of validation rules in its implementing technical standards on supervisory reporting.

December 11, 2018 WebPage Regulatory News
News

IMF Reports Assess the Stability of Financial System in Brazil

IMF published a report on the results of the Financial System Stability Assessment (FSSA) on Brazil.

December 11, 2018 WebPage Regulatory News
News

FED Governor Examines Pros of Imposing Capital Buffers on Large Banks

At the Peterson Institute for International Economics in Washington D.C., the FED Governor Lael Brainard summarized the financial stability outlook, highlighted areas where financial imbalances seem to be building, and touched on the related policy implications.

December 07, 2018 WebPage Regulatory News
News

US Agencies Propose Rule on Appraisals for Real Estate Transactions

US Agencies (FDIC, FED, and OCC) proposed a rule to increase the threshold level at or below which appraisals would not be required for the residential real estate transactions from USD 250,000 to USD 400,000. Comments will be accepted for 60 days from publication in the Federal Register.

December 07, 2018 WebPage Regulatory News
News

EBA Single Rulebook Q&A: First Update for December 2018

This week one answer was published as part of the Single Rulebook Questions and Answers (Q&A).

December 07, 2018 WebPage Regulatory News
News

FED Updates Reporting Form and Instructions for FR Y-14Q

FED published the updated reporting form FR Y-14Q for Capital Assessment and Stress Testing, along with the associated instructions.

December 06, 2018 WebPage Regulatory News
RESULTS 1 - 10 OF 2325