News & Events

Seminar on Product Diversification of Islamic Banks: Prospects and Challenges held in BIBM

Press Release

Dhaka,04 July 2018

A day long seminar was held at the Bangladesh Institute of Bank Management (BIBM) on 04 July 2018, in its auditorium. A paper titled " Product Diversification of Islamic Banks: Prospects and Challenges " was presented in the seminar by Md. Alamgir, Associate Professor, BIBM. Other members of the team are Dr.Md. Mahabbat Hossain,Assistant Professor, BIBM; Md. Abdul Halim,Lecturer, BIBM and Dr. Md. Mizanur Rahman, Senior Vice President & Director (Research) IBTRA.

The study identifies the problem areas as well as success factors in product diversification of Islamic Banks in Bangladesh. A good number of participant’s senior bank executives, academicians, media representatives, faculty members, officers of BIBM participated in the seminar. BIBM Director General Toufic Ahmad Choudhury Chaired the Program. Dr. Prashanta Kumar Banerjee, Professor & Director (RD&C) of BIBM delivered inaugural speech.

Mr. Abu Hena Mohd. Razee Hassan, Chairman of BIBM Executive Committee and Deputy Governor of Bangladesh Bank was present in the seminar as the chief guest. Former managing director of  Pubali Bank & supernumerary professor of BIBM Helal Ahmed Chowdhury, Managing Director of Islami Bank Bangladesh Ltd Mahbub-ul-Alam, Idependent Director of ICB Islamic Bank Ltd Fariduddin Ahmed,  Managing Director of EXIM Bank Ltd Dr. Mohammed Haider Ali Miah among others spoke at the seminar. 

Deputy Governor Abu Hena Mohd. Razee Hassan said, islamic finance industry is expanding rapidly with an impressive double-digit growth. This segment of financial market has already become systemically important in over 12 countries like Iran, Saudi Arabia, Malaysia, Sudan, etc. with more than 15 percent market share of their domestic banking assets.

He said, global Islamic finance assets surpassed USD 2.5 trillion at the end of last year. In this market, Sukuk is playing a vital role for expansion. The commodity market has also been vibrant by involvement of the Islamic banking industry. Along with other international bodies, World Bank, IDB, IFSB, AAOIFI are working for expansion, development and sustainability of Islamic banking.

Former Pubali Bank managing director and BIBM supernumerary professor Helal Ahmed Chowdhury said that the Islamic banks’ stake was 22 per cent in the overall banking sector of the country but the entities lacked adequate number of products. He suggested that the banks should design small loans for product diversification that would ultimately help them hedge risks.

Former Islami Bank Bangladesh managing director Md Forid Uddin Ahmed said that it was very much essential for the Islamic banks to diversify their products for hedging risks.He suggested that the entities should introduce Sukuk bonds for liquidity management.

Former Bangladesh Bank executive director Yeasin Ali said that introducing new products by the Islamic banks would also help them compete with the traditional banks.
Islami Bank Bangladesh managing director and chief executive officer Md Mahbub-Ul-Alam said that the number of products of Islamic banks in Bangladesh was higher than that of the traditional banks. He, however, said that product diversification would also help Islamic banks contain risk of defaulted loans.

BIBM director general Toufic Ahmad Chowdhury said that there were challenges for the Islamic banks, which could be mitigated by introducing new products.


Written by Manager

Thursday 5th July 2018