Chief Executive Officer (CEO), Bank Islami Pakistan Limited, Hassan Bilgrami has said that Islamic banking sector growth is three times more than conventional banking in the country.
Speaking at a meeting of Karachi Chamber of Commerce and Industry (KCCI) on Wednesday, he said that at present Islamic banking share in banking sector is 5 percent and hoped that it would increase to 12 percent by the year 2012.
The CEO said that there are six Islamic banks operating in Pakistan besides 16 conventional banks operating Islamic banking in their branches.
He said that bedsides Pakistan, Islamic banking also making its place in the world banking market and added that present world Islamic banking market is around 700 billion dollars.
He pointed out that India also conducted research in Islamic banking products and added that India would soon introduce Islamic banking products to attract Muslim countries finances. He said that saving rates in Pakistan are lower as compared to others countries in the region. Bilgrami said that in Pakistan only 21 percent people have bank accounts whereas in Canada and USA around 100 percent people have bank accounts.
Replying a question, he said that 56 Muslim countries Ulma Council had already declared that products offered by Islamic banks are Shariah compatible. At present we are following Islamic banking mode of Malaysian. The CEO said that Bank Islami is the first bank to be licensed by the State Bank of Pakistan under the new licensing framework of 2003.
The bank is fully licensed commercial bank, regulated by the SBP and is listed on the Karachi Stock Exchange. All funds raised by the bank are invested in businesses, which are compliance with Shariah.
All profits are pooled and distributed according to the pre-agreed ratio between the bank and the depositors. Transactions are reviewed by the bank Shariah Advisory to ensure compliance with Shariah.