Libya hopes to have its first three dedicated Islamic banks operating next year to satisfy unmet demand for sharia-complaint financial services, a senior central bank official said on Wednesday.
Under former dictator Muammar Gaddafi, overthrown in 2011, the growth of Islamic banking was not encouraged and the entire financial system was kept undeveloped, as four state-controlled institutions dominated the industry.
An extraordinary general meeting (EGM) of Qatari bank Masraf Al Rayan has approved a plan to acquire a shareholding in a Libyan commercial bank, the North Africa Post reports.
The meeting also empowered the board of directors to take decisions concerning urgent business and company acquisitions up to a total cost of QR1bn for two years from the date of this approval.
A number of specialists showed a great conviction of the ability of Islamic banks to expand in the future with the support of the Arab Spring on the one hand and the rising Western interest on the other as these banks showed success in meeting the challenges of the global financial crisis. They believed that the tense situations in Egypt and Tunisia will not change the conviction of individuals, also will not deter governments from making use of Islamic transactions. Moreover, a launch of the first full Islamic bank in Libya will be completed by 2012, and a development of a proposed new law in Morocco regarding banks Islamic as well as expectations of a rapid growth in Egypt.
Islamic banks are set to expand as they compete increasingly with conventional lenders in attracting mainstream customers, according to a report by consultancy Ernst & Young released on Monday.
The total of all commercial banks' Islamic assets is estimated to reach $1.55 trillion this year, $1.8 trillion in 2013 and over $2 trillion mark, the report said. Gulf-based Islamic banks now have $450 billion in assets, about 30 percent of the total.
Libya hopes to start implementing its new Islamic banking law by the end of the year and expects strong demand among the public for sharia-compliant financial services, Libyan central bank governor Saddek Omar Elkaber said on Monday.
The country approved an Islamic banking law in May and has been working to amend its legislation to attract foreign investment and stimulate its private sector following last year's war that ousted Muammar Gaddafi.
It has been reported that supportive socio-political factors and economic incentives shouldaccelerate the growth of Islamic banking activities in North Africa from currentlow levels, according to a new report
published by Standard & Poor's Ratings.
Services titled "Prospects For Islamic Banking In North Africa Improve Following The Arab Spring." Islamic banking started to emerge in North Africa in the 1970s when Egypt was among the first countries in the Arab world to authorize the establishment of pioneer Islamic banks.
Libya has approved an Islamic banking law that will introduce sharia-compliant banking in the North African country, a member of the ruling National Transitional Council (NTC) said on Thursday.
Libya has been working to amend its banking laws to attract foreign investment and stimulate its private sector following last year's war that ousted Muammar Gaddafi, the central bank governor has said.
Global Islamic insurance sales rose nearly 20 per cent to US$8.3 billion (Dh30.48bn) in 2010, but opportunities still abound for further expansion, a new report has found.
Takaful contributions in the UAE grew by 28 per cent to reach $818 million during the year, said Ernst & Young's World Takaful Report 2012.
Ahmed Saeed, a Libyan poultry farmer, says he is waiting for his country to open Islamic banks to deposit money for the first time.
“I’m sure that Islamic banks are more in tune with my culture,” he said on Thursday. “I had a religious upbringing and I hear clerics ban dealing with current banks because of usury.”
A year on from the Arab Spring, prospects for Islamic finance to play a role in the rebuilding of affected countries has gathered pace; even as the countries continue to grapple with the impact of the uprisings.
The industry’s progress in the MENA countries has been especially marked in the first two months of this year.