Bangladesh Bank has taken new initiatives to ensure good governance, transparency, and strict adherence to Shariah principles in the country’s Islamic banking sector.
In this regard, the central bank has approved a policy for forming its own Shariah Advisory Board (SAB), a senior official confirmed on Thursday.
The policy, titled “Bangladesh Bank’s Policy on the Formation, Appointment-Removal of Members, and Responsibilities of the Shariah Advisory Board (SAB)-2025,” was endorsed at the 444th meeting of the bank’s Board of Directors.
Bangladesh Bank’s move aligns with international practices followed by several central banks, including those of Malaysia, Bahrain, Oman, Pakistan, Indonesia, Iran, Kuwait, and the UAE — all of which have established dedicated Shariah Advisory Councils or Boards.
According to officials, the formation of a competent SAB is crucial to making Islamic banking operations in Bangladesh more dynamic, robust, and aligned with contemporary global standards.
The central bank said the SAB will play a key role in resolving ‘doubtful matters’ related to Islamic banks, financial institutions, and other Shariah-based finance sectors. It will also be responsible for setting industry-wide Shariah standards, vetting new financial products, and providing necessary rulings and guidance.
Additionally, Article 16 of the Bank Resolution Ordinance 2025 grants Bangladesh Bank the authority to establish its own Shariah Board to advise on issues concerning the resolution and regulation of Islamic banks.
SR
