UAE, Bahrain central bankers call for Islamic finance reforms

Sultan Bin Nasser Al Suwaidi, Governor of the Central Bank of the United Arab Emirates (UAE) and Rashid Mohammad Al Maraj, Governor of the Central Bank of Bahrain both have called for reforms in improving the foundations of Islamic finance for it to expand globally.

Such refroms includes rulings by Shari’ah boards to be better co-ordinated and harmonised to enable the setting of credible standards. In addition, a clearer distinction also needed to be defined between profit to shareholders and profit to investors and depositors.

Islamic banks account for 16 per cent of the UAE’s banking system and 11 per cent of Bahrain’s banking system.