By Charumini de Silva
Ceylon Finance Today: Sri Lanka's banking watchdog – the Central Bank said that it will accommodate Islamic banking and finance within the existing legal and regulatory framework.
Ceylon Finance Today: Sri Lanka's banking watchdog – the Central Bank said that it will accommodate Islamic banking and finance within the existing legal and regulatory framework.
Central Bank Governor Ajith Nivard Cabraal said as the regulator we welcome the diversification of instruments and systems of finance in banking, financial and insurance sector, and we will provide space to expand within the Monetary Law and Banking Act.
"In Sri Lanka, banking is regulated under the Monetary Law Act and the Banking Act laws provide a flexible environment for the different types of banking and financing to take place in our country. These laws also provide for a consistent type of regulatory action and the standardized approach so that a level playing field is created," he said. Cabraal made these remarks delivering the keynote address at the IFN Sri Lanka Forum 2014 held for the third year in a row, at the Cinnamon Grand, Colombo recently. He said Islamic finance was a key factor in developing the financial sector as it provided new methods of financing; but it was more important to understand the finesse of the Islamic instruments and thereby allocate the benefits to the grassroots level to the corporate business level, he noted.
The world also uses new terminology based on who is doing what and which part of the world you are in. In that context, certain initiatives based on sound principles, are becoming increasingly popular and relevant. So, in Sri Lanka one of the reasons for the stable economic conditions was a result of 'Sri Lanka oriented' policies which we adopted.
However, many did not hail these steps and condemned those acts; but I must say that the 'proof of the pudding is in the eating', he said.
'Islamic finance is a topic that has engaged the attention of the world in recent times. It has enabled a vast segment of the global population to seamlessly integrate with the Islamic world in a sensible manner, which is not inconsistent with religious beliefs."
"We have to search for new markets, institutions and entrepreneurs to open out channels to bring in investments towards the country. Having open channels for investments and instruments are crucial to support the five thrust sectors of our economy. The expansion in the banking, finance and insurance sector will not only assist to build the economy, but also to build the nation collectively," Cabraal noted.
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"In Sri Lanka, banking is regulated under the Monetary Law Act and the Banking Act laws provide a flexible environment for the different types of banking and financing to take place in our country. These laws also provide for a consistent type of regulatory action and the standardized approach so that a level playing field is created," he said. Cabraal made these remarks delivering the keynote address at the IFN Sri Lanka Forum 2014 held for the third year in a row, at the Cinnamon Grand, Colombo recently. He said Islamic finance was a key factor in developing the financial sector as it provided new methods of financing; but it was more important to understand the finesse of the Islamic instruments and thereby allocate the benefits to the grassroots level to the corporate business level, he noted.
The world also uses new terminology based on who is doing what and which part of the world you are in. In that context, certain initiatives based on sound principles, are becoming increasingly popular and relevant. So, in Sri Lanka one of the reasons for the stable economic conditions was a result of 'Sri Lanka oriented' policies which we adopted.
However, many did not hail these steps and condemned those acts; but I must say that the 'proof of the pudding is in the eating', he said.
'Islamic finance is a topic that has engaged the attention of the world in recent times. It has enabled a vast segment of the global population to seamlessly integrate with the Islamic world in a sensible manner, which is not inconsistent with religious beliefs."
"We have to search for new markets, institutions and entrepreneurs to open out channels to bring in investments towards the country. Having open channels for investments and instruments are crucial to support the five thrust sectors of our economy. The expansion in the banking, finance and insurance sector will not only assist to build the economy, but also to build the nation collectively," Cabraal noted.
www.ceylontoday.lk
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