Challenges of regulation and supervision of Islamic Banks

Abstract EN

The Lecture argues that Islamic bank should be supervised using a cross-sectoral approach.

However, whilst such an approach appears to suit the investment and banking services offered by Islamic banks, the Lecture highlights the challenges faced by the IFSB in implementing this approach over the eight years of my work as its Secretary-General.

The Lecture further highlights the implications of these challenges for the future development of the regulation and supervision of Islamic banks.

In particular, it draws attention to the special situation of Unrestricted Profit Sharing Investment Accounts, as a type of investment product used as a Sharah-compliant substitute for conventional deposit accounts, a banking product, and the resultant regulatory issues.