KARACHI: The State Bank of Pakistan (SBP) has asked the Islamic Banking Institutions (IBIs) to have at least three unique members on Shariah Board (SB) including Resident Shariah Board Member (RSBM).

The SBP has amended Shariah Governance Framework (SGF) for Islamic Banking Institutions (IBIs) to facilitate the industry. According to IBD Circular Letter No. 01 of 2021 issued to all Islamic banks, Islamic Banking Subsidiaries and all conventional banks having Islamic banking branches that existing Para 3A(v) of Shariah Governance Framework has been replaced.

As per the amendment, the SB members, except RSBM, may serve on the SBs of up to three IBIs in Pakistan. However, the IBI must ensure that its SB has at least 2 members (other than RSBM), who are not on the SB of any other IBI. Hence, each IBI will have at least three unique members in SB including RSBM.

The revision will be effective from 1st July, 2021. However, IBIs are encouraged to initiate the process of realignment of their SBs as per the above revision immediately, the SBP said.

In view of the industry practices and considering the feedback received from various quarters, the SBP refined framework in June 2018.

Copyright Business Recorder, 2021