Professional Documents
Culture Documents
Governance Framework of
Pakistan
Ahmed Ali Siddiqui
Executive Vice President and Head of
Product Development & Shariah Compliance
Meezan Bank Limited
ahmed.ali@meezanbank.com
2002
within 13 years only, the Islamic Banking share is more than 10% of
the entire Banking Industry
Over the last decade, Islamic Banks have been successful in providing
end to end alternatives to all conventional banking products
The support from the central bank of the country is one of the major factors of the
rapid growth of Islamic Banking industry
With more than 1400+ Islamic Banking branches and a 20%+ growth in deposits,
assets, financing and investments, the Pakistani Islamic Banking industry is set to
become the hub of Islamic Banking of the region
Shariah compliance is the single most important aspect for the Islamic Banking &
Finance industry
Establishment of a Shariah Board & a separate Islamic Banking Department at SBP to directly
supervise & monitor the Islamic Banking industry
Major Highlights
An independent and effective Shariah Board appointed as per Fit and Proper Criteria
(FAPC) of SBP
External Shariah Audit to be undertaken along with the annual audit of the IBI
IAHs
BoD is also required to appoint a Shariah Board that will advise them on
all Shariah related measures
Accountable
and
responsible
for
implementation
of
the
SB
Shariah Board
all Shariah related measures and all the decisions taken by the Shariah
Board are binding on the IBI
The Shariah board will ensure that products and services, contracts,
structure, process flows, product manuals, marketing advertisements,
sales, illustrations and brochures etc are in conformity with the rules and
principles of Shariah
Shariah Board
All the reports of internal Shariah audit and Shariah compliance reviews
should be submitted to the Shariah board for recommending appropriate
action
The Shariah board shall appoint one of its members other than the
chairperson as Resident Shariah Board Member (RSBM). The RSBM will
provide guidance in day to day Shariah related affairs
The department will review all the proposals and related agreements,
contracts,
manuals,
process
flows,
checklists
etc
submitted
by
The
Shariah
compliance
department
is
also
responsible
for
the
The Shariah auditor have a unique role and position in the operational
assessment of banks, their role in providing feedback on strategy can be
enhanced
Head of ISAU will report to the head of Internal Audit or Board Audit
Committee (BAC)
ISAU will prepare a separate Shariah Audit Plan and the final Shariah
audit report shall be submitted to the Shariah Board for prescribing
appropriate actions
Conflict Resolution
The decisions and Fatawa of the Shariah board are obligatory on the IBI.
However in case of difference of opinion between the Shariah board and
the IBIs management on any Shariah related matter, the fatwa/opinion
of the Shariah board etc, the issue shall be referred to the SBP Shariah
Board for decision
JazakAllah!!