Our vision is to make Islamic banking the banking of first choice for the providers and users of financial services.

   Mission Statement

To promote and develop Islamic Banking industry in line with best international practices, ensuring Shariah Compliance and transparency.

    Introduction

Islamic Banking Department was established on 15th September, 2003 and has been entrusted with the huge task of promoting & developing the Shariah Compliant Islamic Banking as a parallel and compatible banking system in the country.

Islamic Banking is one of the emerging field in global financial market, having tremendous potential and growing at a very fast pace all around the world. Al-Hamdulillah, the progress of Islamic Banking in Pakistan has also been commendable during the last three years. Currently there are six licensed full fledged Islamic Banks and twelve conventional banks with standalone Islamic Banking Branches with the total branch network of over 140 branches operating in twenty three cities of all the four provinces in the country as of 01.01.2007 and applications for few more players are under consideration. Islamic Banking is a high priority area for State Bank of Pakistan. Steps are being taken to make Islamic banking industry in Pakistan robust enough to offer a viable alternative to conventional banking, should the market decide that Pakistan should have an exclusively Islamic banking system in the country.

State Bank of Pakistan wants to develop a progressive and sound Islamic banking system that is in line and compatible with the global financial sector, providing innovative Shariah compliant products and services so as to achieve equitable economic growth.

One of the biggest challenges being faced by this growing industry is the dearth of professional Islamic Bankers and capacity building in this regard is one of the top most priorities for the promotion of Islamic Banking. In order to play our regulatory and supervisory role more efficiently we are working on the areas like Risk Management, Corporate Governance, Prudential Regulations, Accounting & Shariah Standards etc. regarding Islamic Banking

Currently the Islamic Banking Department (IBD) consists of following four divisions:

1. Policy Division

2. Shariah Compliance Division

3. Business Support Division

4.Shariah Board Secretariat

    1. Policy Division:

Objectives:

• Devise a vision and strategy paper and work for the promotion of the Islamic banking industry.

• Study the best international practices being applied in the field and work upon their possible application in local market.

• To deal with legal, regulatory, taxation and accounting issues faced by IBIs.

• To steer the Task Force on R&D and deal with issues relating to Islamic economics.

    2. Shariah Compliance Division:

Objectives:

• To strengthen the supervisory aspect of Islamic banking industry through implementation of Shariah Compliance Inspection Manual.

• To analyze the financial data received from the banks and review the same.

• To coordinate with different departments in preparing various SBP publications.

• To develop new products for liquidity management and interbank market

• To liaison with international institutions involved in Islamic finance

    3. Business Support Division:

Objectives:

• To provide administrative support to the department.

• To make arrangements for various meetings

• To make arrangements for the training and video conferences

    4. Shariah Board Secretariat:

Objectives:

• To arrange Shariah Board meetings, preparing agenda and minutes of the meetings and conduct due diligence of Shariah Advisors of IBIs

• Frequently Asked Questions (FAQs)
• Policies For Promotion Of Islamic Banking
• Detailed Criteria For Setting Up Of Scheduled Islamic Commercial Bank Based On Principles Of Sharia In The Private Sector
• Detailed Criteria For Setting Up Of Islamic Banking Subsidiaries By Existing Commercial Banks
• Guidelines For Opening Of Stand Alone Branches for Islamic Banking By Existing Banks
• Fit & Proper Criteria for Appointment of Shariah Advisors
• Form SAP for Shariah Advisors
• FORM-A
• ANNEXURE-A
• State Bank’s Shariah Board Approves Essentials and Model Agreements for Islamic Modes of Financing
  

• Islamic Banking Bulletin
• Islamic Banking Glossary
• Article on Takaful – An Alternative to Insurance written by Muhammad Ayub
• Derivatives and Islamic Finance by Muhammad Ayub
• Islamic Bankari Nizam Ka Khakah
• Islamic Modes of Finance
• Interest, Mark up and Time Value of Money
• Can Banks Survive without Interest?
• Standardisation of Shariah Practices
  

•  SBP Governor’s Speeches on Islamic Finance

Seminar on Islamic Financial Accounting Standards 1 & 2

Video Conference on Islamic Banking

Islamic Banking Network

Guidelines for Islamic Microfinance Business by Financial Institutions

Instructions and Guidelines for Shariah compliance

Islamic Financial Services Board Survey

Risk Management Guidelines for Islamic Banking Institutions