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December 15, 2006
Indonesia: Government Plans to Expand Islamic Banking
This is the kind of story that gets lost in the heat of the moment, but is important nonetheless. The Islamization of Banking paves the road for further Shari'a advances in the future (with thanks to Giussani): INDONESIA: CENTRAL BANK BOOSTS ISLAMIC BANKING
Jakarta, 12 Dec. (AKI/Jakarta Post) - Indonesia's central bank (BI) has launched a new programme to accelerate the development of the country's Islamic, or sharia, banks, which at present only account for about 1.68 percent of the country's total banking assets. Under this ambitious programme the central bank hopes that banking assets that comply with Islamic law will increase by 75 percent to Rp 47.94 trillion (about 5.3 billion dollars) by the end of 2007, from the approximately Rp 27.14 trillion expected by the end of 2006.Through the programme, the central bank also wants to boost the Islamic banking sector's share of the country's total banking assets to 5.25 percent by the end of 2008 from the current 1.68 percent.
The program is based on four main strategies: promoting supply and demand; strengthening the sharia banking system, especially as regards capitalization and management; optimizing the functions of government and the central bank; and involving all the stakeholders in the sharia banking sector in the program.
Indonesia adopted its dual banking system policy, which allows both standard and sharia banking practices, in 1992.[...]
Posted by Ruy Diaz at December 15, 2006 9:10 PM
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