KARACHI, Aug 7: The Shariah Board of the State Bank reviewed on Saturday the comments and suggestions received by the SBP on essentials and model agreements of Islamic mode of financing. The board meeting was held here at the SBP headquarters with its head Dr Mahmood Ahmad Ghazi in the chair.

SBP had developed essentials and model agreements of Islamic mode of financing and placed them on its website in April this year inviting comments and suggestions from all stakeholders.

The Shariah Board noted that the response from stakeholders including bankers, religious scholars, legal experts as well as the general public was excellent. The guidelines finalized through the consultative process would become the basis for Prudential Regulations for Islamic banking in the country.

Dr Ghazi "appreciated the proactive role being played by SBP in promoting Islamic banking in the country." He observed that the current regulations governing Islamic banking were in line with the best and the most progressive regulations being followed in countries like Bahrain and Malaysia.

Judging from the response of key stakeholders and the progress made so far, Dr Ghazi said he was confident that the SBP's efforts in promoting Islamic banking in Pakistan in its true form would be very successful.

By introducing a comprehensive Shariah compliance mechanism that includes appointment of Shariah advisors by banks in accordance with the Fit and Proper Criteria determined by the Shariah Board and Islamic banks' Shariah audit, these regulations will ensure effective compliance of the relevant Shariah norms.

Sheikh Esam Muhammad Ishaq, Shariah Advisor of Al-Baraka Bahrain who is currently on a visit to Pakistan, was invited by the Board to come and share his international experience on Shariah issues and approach being adopted internationally.

He observed that the SBP Shariah Board's approach in identifying and resolving Shariah issues was in line with the international norms.

He observed that Pakistan would be able to achieve its objective of establishing Islamic banking as a parallel system. He assured the Shariah Board of his support in any form, if required.

The meeting was attended by the members of the Shariah board Dr Imran Usmani, Ebrahim Sidat, Syed Riazul Hassan Gilani and Pervez Said, Director, Islamic Banking Department of SBP who is also the secretary of the board.