The National Bank of Pakistan (NBP) has sought regulator’s approval to conduct due diligence of Burj Bank, as the bank wants to continue its footprints in the Islamic banking industry, an official said on Monday. “Subject to the State Bank of Pakistan (SBP) approval, the NBP intends to conduct due diligence of Burj Bank,” S M Ali Zamin, an official at NBP, said.
The NBP had already initiated the process of converting its existing branches into Islamic ones, which will increase to 175 by the end of this year. The NBP has been considering 100 percent wholly-owned Islamic banking subsidiary or in case of an opportunity, acquisition of an Islamic bank and the MCB Bank staying its plan to go with the acquisition of Burj Bank provided NBP with this opportunity, the official said.
Burj Bank is the smallest of five full-fledged Islamic banks in Pakistan with a network of 75 branches.
“Islamic banking is flourishing across the globe, particularly in Pakistan, and the NBP, which enjoys the trust of the masses, is up to be a key player in the Islamic banking,” the official said.
The State Bank of Pakistan is stepping up its push to develop Islamic banking, encouraging lenders to expand their operations in the world’s second most populous Muslim nation.
Pakistan was one of the first countries to introduce Islamic banking at a national level in the 70s, but the industry’s share of the overall banking system has lagged levels in some other countries.
The central bank aims at doubling the industry’s branch network and reaches a 15 percent share of the banking system in the next five years, and is taking fresh steps to achieve that. Recently, the SBP had named a new deputy governor to focus on the Islamic banking and enlisted renowned scholar Muhammad Taqi Usmani to its Shariah Board.
Last year, the central bank had launched a media awareness campaign and said it would revise the rules on Shariah governance and liquidity management for Islamic banks.
Source: The News
