Islamic banks were providing special deposit rates to their customer
by foregoing their own share of profit. This practice was adopted by
the banks to compete in the highly challenging Enviornment of banking.
However, objecting this practice, SBP has barred the Scheduled Islamic
Banks to distribute profits with special premiums.
SBP has issued circular No.3 dated Nov 19, 2012 in this regard with
subject "Instructions for Profit & Loss Distribution and Pool
Management or Islamic Banking institutions "
Some Islamic Bankers are of the view that this step was done to curb
the high growth in deposits of Islamic Banks.
However, SBP has taken a stance that this step would bring more
transparency, disclosure & standardization to the Islamic Banking
System.
by foregoing their own share of profit. This practice was adopted by
the banks to compete in the highly challenging Enviornment of banking.
However, objecting this practice, SBP has barred the Scheduled Islamic
Banks to distribute profits with special premiums.
SBP has issued circular No.3 dated Nov 19, 2012 in this regard with
subject "Instructions for Profit & Loss Distribution and Pool
Management or Islamic Banking institutions "
Some Islamic Bankers are of the view that this step was done to curb
the high growth in deposits of Islamic Banks.
However, SBP has taken a stance that this step would bring more
transparency, disclosure & standardization to the Islamic Banking
System.
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