The Islamic Financial Services Board (IFSB)


The Kuala Lumpur-based IFSB started operations in March 2003. Since then it has served as an international standard setting body for regulatory and supervisory agencies that have a vested interest in ensuring the soundness and stability of the Islamic financial services industry, including banking, capital markets and insurance. Its mission statement is to promote the development of a ‘prudent and transparent Islamic financial services industry’ by introducing new, or adapting existing, Shari’ah-compliant international standards, and then recommending them for adoption. It sees its work as complementary to that of the Basel Committee on Banking Supervision, the International Organisation of Securities Commissions, and the International Association of Insurance Supervisors. The IFSB is composed of a General Assembly, the Islamic Financial Services Board, the Technical Committee, and the Secretariat.


As of mid-2009, it had 185 members (more than double what it had


a couple of years earlier), including 43 regulatory and supervisory authorities as well as the International Monetary Fund, the World Bank, Bank for International Settlements, the Islamic Development Bank, the Asian Development Bank, the AAOIFI, and 136 financial institutions from 35 jurisdictions. Standards prepared by the IFSB necessarily follow a lengthy due process, as outlined in its Guidelines and Procedures for the Preparation of Standards/Guidelines. It has recently adopted two new standards; the Guiding Principles of Risk Management, and the Capital Adequacy Standard for Institutions (other than Insurance Institutions) offering only Islamic Financial Services. It also works on issues relating to corporate governance and standards in areas such as supervisory review processes, transparency and market discipline, special issues in capital adequacy (such as for sukuk) and governance of investment funds. The IFSB is actively involved in promoting awareness of issues that are relevant to and that have an impact on the regulation and supervision of the Islamic financial services industry. This work mainly takes the form of international conferences, seminars, workshops, training sessions, meetings and dialogues, staged in a number of countries.


The General Council for Islamic Banks and Financial Institutions (GCIB- FI)


GCIBFI is an international autonomous non-profit making corporate body that represents Islamic banks and financial institutions, and the Islamic financial services industry globally. GCIBFI was founded in Bahrain in May 2001. Major objectives of the GCIBFI are the dissemination of Islamic Shari’ah concepts, rules and provisions related to them and to develop the Islamic financial industry. It also seeks to enhance co-operation among its members, provide information related to Islamic financial institutions, and cater for the interests of its members and to help overcome their common difficulties and challenges. It publishes a range of information bulletins, brochures, magazines, newsletters and books along with the organisation of conferences, seminars and workshops. It has established a database for the Islamic banking and finance industry at large. Membership of GCIBFI is open to any registered Islamic bank or financial institution anywhere in the world, as long as it undertakes all its activities in compliance with the tenets of Islam.


The International Islamic Financial Market (IIFM)


The IIFM is one of the core infrastructure institutions of the Islamic banking and finance industry. This not-for-profit organisation was established in April 2002 and is headquartered in Bahrain. Its principal aim was, and is, to meet the demands of Islamic financial institutions that realised the need to develop the infrastructure to support their activities to become a viable alternative to the conventional banking system. Its founders are the Central Banks and Monetary Agencies of Bahrain, Malaysia, Brunei, Indonesia, Sudan, and the multi lateral institution, the Islamic Development Bank. The primary function of IIFM now is to enhance cooperation among Islamic countries and financial institutions. It claimed strong relationships with other related infrastructure institutions that have been established to contribute to the needs of the Islamic banking and finance industry. Specific links exist with the GCIBFI, Islamic Financial Services Board (IFSB), AAOIFI, the Liquidity Management Centre (LMC – see below) and the


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Islamic Report www.ibsintelligence.com


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