KUALA LUMPUR – Despite going through the bitter sweet ups and downs throughout its 17 years, the Kuala Lumpur based international standard-setting body of regulatory and supervisory agencies, the Islamic Financial Services Board (IFSB) has made its mark.
Inaugurated on 3rd November 2002, the IFSB started its operations on 10 March 2003.
The Secretary-General of IFSB, Dr Bello Lawal Danbatta shared interesting details on its establishment to complement the role of Malaysia in promoting Islamic financial for 40 years.
According to him, the initiatives of Malaysia had encouraged the emergence of a body which can support global Islamic Financial services.
He said, the Islamic banking and financing is unique, thus, it requires a different set of regulations and rules as its development guideline and maintain its resilience in the industry.
“Therefore, nine founding members, including Malaysia has concluded that there was a need to have a standard setting such as the Basel Committee which supervises banking, International Organization of Securities Commissions (IOSCO) or International Association of Insurance Supervisors (IAIS).
“Its objectives was to make Islamic financial services more competitive, resilient, and stable like any other conventional financial services,” he told MalaysiaGazette.
Fortunately, the Central Bank of Malaysia, Bank Negara Malaysia stepped forward and took its position as the secretariat to the IFSB in Malaysia and the proposal was supported by Tun Dr Mahathir Mohamad, who was the then 4th Prime Minister of Malaysia.
As the host country, Malaysia was so supportive of IFSB that it enacted a law known as the Islamic Financial Services Board Act 2002, which gave the IFSB the immunities and privileges that are usually granted to international organisations and diplomatic missions.
Bello further shared that the choice of Malaysia as the Secretariat of IFSB has exposed the leadership of Malaysia to Islamic financing and gave the country an opportunity to play its role as the leader in developing Islamic financing in the world.
Bello expected that the journey of IFSB Malaysia would be more challenging in the future, besides shouldering his responsibilities in publishing a standard for the Islamic financing operations.
He said, the mandate of IFSB is to develop and publish standards in ensuring the soundness and stability of the Islamic financial services industry, which is defined broadly to include banking, capital market and insurance (takaful).
“IFSB functions to develop standards and support Islamic financing implementation through workshops, research, awareness and engagement programmes with its members from various aspects.
“With this approach, its members will support the mandate for a stable and resilient global Islamic financial services stability and resilience,” he added. -MalaysiaGazette