The FSA hosts meeting with Islamic financial community leaders
08/09/1999
The Financial Services Authority (FSA) today welcomed the Citizen Organising Foundation and representatives from the Islamic community to a meeting at the FSAs offices. The meeting was part of the FSAs long-standing dialogue with the Islamic financial community aimed at improving mutual understanding of Islamic banking and the FSAs regulatory framework.
Speaking after the meeting, Howard Davies, the FSAs Chairman said:
"There is no reason, in principle, why a bank operating under Islamic principles could not be authorised by the FSA. The UK has an excellent record in the development of new financial and banking products, including Islamic financial products, and in attracting banks from a range of economic and financial systems.
So far at least, the FSA has not received an application to establish an Islamic bank. Any such application would be considered against the FSAs minimum criteria for authorisation, which is the same for all banks. In some respects, it may be more difficult for Islamic banks to show that they can meet these criteria but it is by no means impossible. The dialogue the FSA, and previously the Bank of England, has with the Islamic financial community, both in the UK and abroad, and the work that Islamic institutions and organisations are doing themselves to meet international standards, is the best way to resolve these difficulties."
Notes for editors
The Government announced on 20 May 1997 that it would create a single regulator for all financial firms and markets and the FSA was formally launched on 28 October 1997. The FSA has assumed responsibility for the supervision of banks and supplies regulatory and other services under contract to the three Self-Regulating Organisations (SROs), the Building Societies Commission, the Friendly Societies Commission, HM Treasurys Insurance Directorate and the Registry of Friendly Societies. These arrangements will continue until the new legislation comes into force.
The bodies represented at todays meeting were the Citizen Organising Foundation, the Islamic Foundation, the Muslim Council of Great Britain, the Institute for Islamic Banking and Insurance and the East London Mosque.
London is the major western centre for Islamic financial products. A number of international banks base their Islamic business units in London. There are also a number of Islamic funds managed in London and regulated by IMRO.