Bank Muscat Board attends AAOIFI session

Providing guidance to the board of directors on the principles of sharia governance, the session focused on practical interpretation and understanding of the principles of Islamic finance

MUSCAT: The Bank Muscat Board of Directors led by Sheikh Khalid bin Mustahail Al Mashani, chairman, and Meethaq Sharia Supervisory Board led by Sheikh Dr Ali Qaradaghi, chairman, held a joint meeting which focused on the governance role of the board on Islamic banking window operations.

Providing guidance to the board of directors on the principles of sharia governance, the session focused on practical interpretation and understanding of the princi- ples of Islamic finance, the board’s responsibility for Islamic banking window and an overview of global trends of Islamic bonds (Sukuk), says a press release.

The initiative came in line with the bank’s strategy to explore and acquire new perspectives, ideas, skills and a depth of knowledge that drives best practice and creates a dynamic business environment. The joint session was facilitated by Omar Mustafa Ansari from the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI).

The session highlighted the boardroom responsibilities on the underlying principles of Islamic financial system and equitable distribution of risk-reward by linking rewards to risk and asset backed transactions. The financial implications and challenges of applying the principles of Islamic banking and the key roles of the board based on AAOIFI GSIFI – 6 (Governance Standard for Islamic Financial Institutions) and IFSB (Islamic Financial Services Board) standards were discussed.

The Board was also briefed on steps to establish appropriate and effective Shari’a compliance structures; and to ensure public disclosures; adopt code of conduct and ethics for the boards and management; corporate social responsibility and Sukuk.

Meethaq is focused on developing as a benchmark for Islamic banking and finance in Oman and the region. Within just three years of operations, Meethaq has attained the leading position in the Islamic banking industry in Oman in terms of financing receivables, branch network, products and services, IT infrastructure and human resources development. The Meethaq Shari’a Supervisory Board has made valuable contributions in establishing Meethaq as the leading Islamic banking service provider in Oman.

The Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) – established in 1991 and based in Bahrain – is an international Islamic finance industry infrastructure development body that is responsible for development and issuance of standards on Sharia, accounting, auditing, ethics and governance for Islamic financial institutions. With 25 years’ experience in the field, AAOIFI has issued 55 Sharia standards, 26 accounting standards, five auditing standards, seven governance standards, and two codes of ethics.