Bahrain draws up Islamic banking rules

The Bahrain Monetary Agency (BMA) has developed a framework known as "prudential information and regulations for Islamic banks" (PIRI), according to BMA Governor Sheikh Abdullah bin Khalifa Al Khalifa.
Emphasising the need for Islamic financial institutions to establish and conform to regulatory standards of the highest quality, Sheikh Abdullah said, PIRI takes into consideration both the standards developed by the Accounting and Auditing Organisation for Islamic Financial Institutions and the Basle Committee's various guidelines.
The PIRI covers five main areas such as capital adequacy for both credit and market risk, asset quality, including monitoring of large exposures and related party exposures, regulatory treatment of investment accounts, both restricted and unrestricted, and on and off balance sheet prudential requirements concerning liquidity management and analysis of earnings quality.
The BMA governor was speaking at the World Islamic Banking Conference.
Meanwhile, the challenges and opportunities thrown open by the IT revolution and the preparedness of the Muslim world to face the challenges and exploit the opportunities was dealt in detail by Pakistan's Finance Minister Shaukat Aziz.
Addressing the World Islamic Banking Conference, Shaukat Aziz highlighted three main challenges - the ability to learn to live in an information society, realising the technology in the form of job creation, and public policies to be the critical determinant in the speed and quality adjustment to information society.
Yesterday's session discussed topics ranging from marketing and positioning Islamic financial products and services within the global economy to e-commerce and law of Islamic banking.