Philippine Congress moves a step closer to expanding Islamic banking

The Central Bank shall exercise regulatory powers and supervision over the operations of Islamic banks. (Reuters)
Updated 21 November 2018
0

Philippine Congress moves a step closer to expanding Islamic banking

  • Establishment of more Islamic banks in Southeast Asia and the Middle East will benefit more than 10 million Filipino Muslims
  • The Central Bank will exercise regulatory powers and supervision over the operations of Islamic banks

MANILA: The Philippines has moved a step closer to opening the country to the wide range of banking and other financial services available through Islamic banking and finance.
The move comes after the House of Representatives recently approved on second reading a proposed bill providing for the regulation and organization of Islamic banks in the Philippines.
In an emailed statement to Arab News, Congressman Henry Ong said the “eventual enactment of the (proposed) law would be one of the historic moments in Philippine banking history.”
The country’s first Islamic bank, according to the lawmaker, was created in 1972.
“With this imminent new law, there will be more Islamic banks not just for Mindanao but also for the rest of the country,” said Ong, who is chairman of the House Committee on Banks and Financial Intermediaries.
Parallel to this bill’s movement through Congress, the Philippine Stock Exchange has its Shariah index of stocks on the PSE where some 60 securities are listed.
Ong noted that the establishment of more Islamic banks, especially those based here in Southeast Asia and in the Middle East, will greatly benefit the 10 million-plus Filipino Muslims, many of whom are “unbanked.”
He pointed out that this is so as the proposed measure will make available particularly to Filipino Muslims, “a vast array of banking, lending, and investment products and services.
“Mindanao’s economy will reap great harvests because of this bill. Filipino Muslims in the Middle East and Southeast Asia would most likely be able to send more remittances to their families and friends. Businesses in Mindanao will have more financing options to grow,” Ong said.
“Upgrading and expanding Islamic banking and finance will help stimulate economic growth in the Bangsamoro Autonomous Region, as well as in Filipino-Muslim communities in Metro Manila and other urban areas nationwide,” Ong continued.
The lawmaker likewise emphasized said that aside from providing the people of Mindanao more banking options, Arab investors and bankers will have more reasons to participate in the growth of the Philippine economy.
“More Islamic banks means more direct investments, including investments by international Islamic banks especially those here in ASEAN, the Middle East, and even Africa,” he said.
Under the proposed bill, Islamic banking business refers to banking business with objectives and operations that do not involve interest (riba) which is prohibited by the Shari’ah and which conducts its business transactions in accordance with Shariah principles.
Section 3 of the bill also provides that the Central Bank’s Monetary Board may authorize the establishment of Islamic banks. It may also authorize conventional banks to engage in Islamic banking arrangements, including structures and transactions, through a designated Islamic banking unit within the bank.
Under prescribed rules and regulations, it may also authorize foreign Islamic banks to establish banking operations in the Philippines under any of the modes of entry provided under Republic Act No. 7721, as amended, otherwise known as “The Liberalizing of Entry and Operations of Foreign Banks in the Philippines.”
The Monetary Board may regulate the number of participants in the Islamic banking system, taking into account the requirements of the economy, the preservation of the stability of the system, and the maintenance of healthy competition.
The Central Bank shall exercise regulatory powers and supervision over the operations of Islamic banks.
The bill further mandates that Islamic banks shall be responsible in ensuring compliance with Shari-an principles. For this purpose, it shall constitute a Shariah advisory council composed of people who have knowledge or experience in Shariah and in banking, finance, and law.


British boat rescues migrants trying to cross Channel

Updated 18 February 2019
0

British boat rescues migrants trying to cross Channel

  • British border officials have picked up 34 people who were trying to cross the English Channel in a small boat
  • The Home Office said the passengers are thought to be migrants and their nationalities were not known yet

LONDON: A British boat rescued 34 migrants crossing the Channel aboard a small motorised boat on Monday, Britain's interior ministry said.
"Today Border Force responded to an incident in the Channel involving a small boat containing 34 people," the ministry said in a statement.
"The group were brought to Dover and have been transferred to immigration officials for interview," it added, saying that men, women and children were on board and that three men were arrested on suspicion of immigration offences.
French authorities earlier said that "a fishing boat gave the alarm shortly after 8:00 am (0700 GMT)" after spotting the boat off the tip of northern France.
French navy, police and customs launched a helicopter, a tug boat and three fast vessels, while sea rescue services also tried to rescue the migrants.
By the time they reached the migrants' location, however, "they had crossed over to the English side" of the Channel where they were picked up by a British vessel, said the regional authority in northern France.
Two British Border Force cutters and a coastal patrol vessel were involved in the rescue, according to UK authorities.
Some 500 people -- most of them over the last two months of 2018 -- attempted to cross the Channel to Britain last year, compared with just 13 known attempts in 2017.
French interior ministry figures show 276 people successfully reached British waters last year.
London in December dispatched a navy ship to help coastguard boats watch over the 21 miles (33 kilometres) of sea that separate France and Britain at its narrowest point.
France also responded by announcing broader surveillance measures in early January.
The number of Channel crossings was just a tiny fraction of the 55,756 successful attempts made across the Mediterranean to Spain that were recorded by the UN's refugee agency in 2018.