Bangladesh Bank governor, Dr Atiur Rahman, on Tuesday urged the managements of banks engaged in Islamic banking in the country to remain alert against terrorism financing. "I would like to remind you all about the need of due alertness against aiding extremists and abetting terrorism," Dr Atiur told bankers at an international seminar on "The Global Crisis and the Strength of Islamic Banking System", organized jointly by Islamic Bank Bangladesh Ltd. (IBBL) and Islamic Banks Consultative Forum (IBCF), at a hotel in the city.

The central bank governor also hailed the role of Islamic banking by saying, "Its ethos serves well to check laundering money that is associated with crime."
He said the profit and loss sharing nature of liabilities of Islamic banks is a good safeguard against solvency risk.

He said Islamic banking constituted 18.5 per cent of deposits and 19.7 percent of advances of the banking system in 2010, in Bangladesh. He said, recently, the central bank has circulated a comprehensive guideline to the banks for proper growth of Islamic banking in the country.

He said the country still lacks a secondary market for Islamic financing products for which a portion of the money deposited in the central bank by Islamic banks remains idle.
Speaking on the occasion, IDB (Islamic Development Bank) president Dr Ahmed Mohamed Ali said Islamic banking provides a relatively stable Shari'ah compliant alternative to the financial needs of the society.
"This stability demonstrated by Islamic banks during the recent financial crisis in comparison with their conventional counterparts, has already been recognised," he said.   The IDB president said the Islamic financial service industry is also expanding its scope by including microfinance namely micro-Takaful.

As Bangladesh pioneered the idea of microfinance, the micro-Takaful system has been designed to give low-income individuals in communities quick and easy access to socio-economic services, opportunities for self-employment and thus the chance to uplift themselves out of poverty, he said. 

IBCF chairman Prof Abu Nasser Mohammad Abdul Zaher said that the Islamic banks are working to free the people of Bangladesh from the curse of interest. The first day of the seminar was participated by some 275 officials of 11 banks those have been operating Islamic banking in the country completely or by opening a separate branch or a window.  Former IDB research head, Dr Ausaf Ahmed has presented a key-note paper at the seminar.
Among others, IBCF vice chairman Nazrul Islam Mojumder spoke at the seminar.

Past and present presidents of Federation of Bangladesh Chambers of Commerce and Industry, Salman F Rahman and AK Azad attended the first day's concluding session of the seminar. Organisers said several business sessions linked to Islamic banking will be held on the second day, on May 25, of the seminar which will be open for bankers and traders.

Source: The Independent/Bangladesh/May-25-2011