Tuesday, 21st June 2022, Manama, Kingdom of Bahrain – The Board of Directors of the International Islamic Financial Market (IIFM) held its forty-sixth (46th) meeting (virtually) to discuss the Islamic finance standard-setting body’s new standardization and industry development initiatives.
The meeting was opened by Mr. Ijlal Ahmed Alvi (Chief Executive Officer and Secretary to the Board of IIFM) by welcoming all the participating Board members. The Vice Chairman of IIFM, Mr. Nik Mohamed Din Bin Nik Musa (Labuan Financial Services Authority, Malaysia) chaired the meeting where participants were Mr. Arief Hartawan (Bank Indonesia), Dr. Mansur Noibi (Islamic Development Bank), Mr. Shukri Ahmad (Brunei Darussalam Central Bank), Mr. Abubaker Mohamed (Central Bank of Sudan), Mr. Hammad Hassan (Bank ABC Islamic), Mr. Hamza Khalid Bawazir (Saudi National Bank), Mr. Ahsan Ali (Standard Chartered Saadiq), Mr. Rami Falah (BNP Paribas), Mr. Salah Sharif (GFH Financial Group) and Mr. Kamal Abdelkarim Hassan (Kuwait Finance House-Bahrain). From IIFM Management and Secretariat, Dr. Ahmed Rufai (Head of Compliance/Shari‘ah, IIFM) also participated in the meeting.
The Board of Directors welcomed Mr. Arief Hartawan, Head of Islamic Economics and Finance Department at Bank Indonesia as the new Director representing Bank Indonesia on IIFM Board. The Board of Directors also welcomed BNP Paribas to the IIFM Board represented by Mr. Rami Falah, Head of Islamic Banking, Middle East & Africa.
At the meeting, the Directors deliberated on IIFM priority initiatives namely standardization of Islamic syndication documentation and additional Islamic liquidity management instrument.
IIFM has formed a Syndication Standardization Core Working Group consisting of leading institutions from key jurisdictions to finalize the consultation paper which will be deliberated upon at the IIFM industry consultation meeting planned to take place during Q3 2022. Based on the meeting recommendations, IIFM may commence the standardization initiative.
The Board assessed the growing need for developing an additional Islamic liquidity management tool and approved the formation of a global working group and to organize an industry consultation meeting in 2022 so that actual development work may commence based on the recommendations from the market.
The board members stressed on the importance of key stakeholders’ participation in IIFM standardization working groups from most of the jurisdictions where Islamic finance is practiced and emerging.
The board members agreed with IIFM management’s suggestion to initiate consultation-based review of certain widely used IIFM-ISDA Islamic hedging Standards. IIFM will explore organizing a joint market consultation exercise with its partner the International Swaps and Derivatives Association (ISDA) to assess additional requirements as well as possible inclusion of limited enhancements based on market feedback and regulatory developments.
The board also assessed IIFM’s ongoing work in the area of mandatory global climate-change and ESG related requirements. IIFM organized a virtual awareness session earlier this year in collaboration with Oman Banks Association (OBA) with the support of the Central Bank of Oman (CBO) and will be working with other global stakeholders to organize more such sessions on this important development which pose challenges for the financial sector.
Mr. Nik Mohamed Din Bin Nik Musa, Vice Chairman of IIFM said, “these initiatives are the attestation of IIFM to provide the best solutions for the advancement of Islamic Financial Market”.
“IIFM develops standards with a view to meet the globalization requirements of Islamic finance and also to maintain the development of the industry on a unified and harmonized basis”, said Mr. Ijlal Ahmed Alvi, Chief Executive of IIFM.
Earlier this year, IIFM and the Participation Banks Association of Türkiye (TKBB) signed a Memorandum of Understanding (MoU) to collaborate on areas of common interests for the development of the participation banking sector in Türkiye and globally. IIFM will continue to initiate such collaborative efforts with other organizations in major Organization of Islamic Conference (OIC) jurisdictions.
IIFM began offering professional training program on IIFM Standards last year in collaboration with Dar Al Sharia Islamic Finance Consultancy (DAS). So far, two virtual workshops have been held on IIFM Islamic Liquidity Management Standards and one physical workshop on IIFM-ISDA Islamic Hedging Standards. The Board of Directors appreciated these capacity building initiatives on IIFM Standards and recommended to offer the courses in major Islamic jurisdictions.
IIFM will publish the 11th edition of its flagship annual Sukuk Report through a webinar launch event during Q3 2022.
The IIFM Accounts for the year 2021 audited by Deloitte & Touche - Middle East were approved at the meeting.