Muscat: There are studies and discussions being undertaken to decide whether full-fledged Islamic banks in Oman could be a viable replacement for the Islamic banking windows operating currently.
Currently, most of Oman’s Islamic banking is done through ‘windows’, which are services that function as a part of larger banks.
“The next step [of Islamic banking] is currently under study in Oman. Discussions are on with the central bank and other banks regarding whether it would be better to keep Islamic banking in a window system, or whether we could move towards establishing full-fledged Islamic banks,” Tahir Al Amri, Executive President, CBO, told Times of Oman.
Al Amri was speaking during the rebranding of Ahlibank’s Islamic banking window from Al Hilal Islamic Banking to Ahli Islamic.
During the event, Said Abdullah Al Hatmi, CEO of Ahlibank, said, “We are pleased with the inauguration, and hope that this will be a new start for Islamic banking services and products provided by the window.”
“We in the Islamic banking sector are optimistic about the growth in the country, and think that the sector has helped to diversify products and has been a major player in diversifying the economy as well. Islamic banking in Oman has been largely successful in Oman, with Islamic windows growing year after year,” Al Hatmi said.
According to the Midterm Review of Oman’s economy by the Central Bank of Oman, “Islamic banks and windows provided financing of OMR3.5 billion at the end of September 2018, 19.5 per cent higher than a year ago, and about 93 per cent of financing was provided to the private sector.”
The report added that “Although two full-fledged Islamic banks are gaining traction, Islamic windows of conventional banks extended the major part of financing,” showing the role of Islamic banking windows in this growth.
“The experiment of Islamic banking in Oman has been truly successful, and is five years old now, having started at around 2013. The beginning of Islamic windows and banking had been well-studied was started as part of the strong banks, which led to good results. As we saw, the Islamic windows of the Ahlibank, and other windows, have been successful,” Al Amri pointed out.