| DUBAI, June 24
DUBAI, June 24 A Bahrain-based association which
lobbies on behalf of Islamic finance says it plans to expand
beyond the Gulf, so that it can shape rules and practices in new
markets as they grow.
The General Council for Islamic Banks and Financial
Institutions (CIBAFI), a non-profit organisation headquartered
in Manama, has traditionally focused on neighbouring countries,
which form a core market for the industry.
But Omar Hafiz, who took over last year as secretary-general
of the body, said he was keen to enlarge its geographic scope
while engaging national regulators more actively.
"We are trying to have a representative office in Tunisia,
operating as a gateway to Africa, and also in Azerbaijan to
reach central Asian countries," he told Reuters.
Founded in 1999 by the Jeddah-based Islamic Development Bank
, CIBAFI has 114 member institutions, including
Egypt's Faisal Islamic Bank, Kuwait Finance House
and Bahrain-based Al Baraka Banking Group.
Saudi-Arabia's National Commercial Bank joined last year.
The Saudi-born Hafiz, 62, said that for its long-term
health, the industry should focus as much on improving the
regulatory environment as increasing its size.
"It is not just a matter of licensing Islamic banks, but
preparing a platform for success for Islamic banking," he said.
"We want to ensure competition between the conventional and
Islamic banking industry is in its best shape, not inferior or
second class, but on the same level."
Addressing a major weakness in Islamic finance, a lack of
well-trained professionals, CIBAFI plans to expand its training
and certification programmes, which are currently distributed
through a network of over 30 agents in countries from Jordan to
"We hope to reach 50 agents by the end of 2014. Maybe our
training centre can be a separate body - this is still in the
development stage, it still needs two to three years to
develop," Hafiz added.
The body also plans to hold forums in new markets for
Islamic finance, including events in Morocco and Libya later
One of CIBAFI's key messages is that Islamic windows - units
of conventional banks which offer Islamic financial products and
services - need to operate under clear rules to improve the
perceptions of consumers.
"In some cases, conventional banks which offer Islamic
windows or Islamic transactions are trying to pull the financial
products towards their conventional ways of operation," Hafiz
said, arguing this hindered consumers from distinguishing
between conventional and Islamic products.
"It may be owned partially or totally by a conventional
bank, but a full separation technically and legally should be
shown to consumers."
This could improve the industry's appeal and eventually
reduce the reliance on the Islamic window model in favour of
full-fledged operations, Hafiz said.
"This is maybe a transitional time, not the end situation."
(Editing by Andrew Torchia)