(MENAFN- Khaleej Times) The CEO advisory council agreed to add four new specialised committees to oversee audit operations and payments IT and fraud.
Dubai: UAE’s banking sector reform drive has gathered pace with two key initiatives — a code of conduct for member banks and the setting up of a centralised Shariah board — making further headway.
The UAE Banks Federation or UBF a professional body representing 50 member banks operating in the country has thrown its weight behind the two initiatives designed to take the financial sector to a higher level of competence transparency and best practices regime.
At a CEOs’ Advisory Council meeting held in Dubai the federation has approved the appointment of a new independent monitoring agency for the implementation of its “Code of Conduct” by member banks.
AbdulAziz Al Ghurair chairman of the UBF said on Sunday that the creation of a marketing committee and the commissioning of independent monitoring of advertising “are tangible actions to reinforce observance of the banking industry’s code of conduct.”
As per the code of conduct member banks should seek to behave in a transparent and honest way in their marketing communications. “This comes in line with UBF’s diligence and continuous efforts to ensure that best practice is implemented by member banks in their dealings with their customers” said Al Ghurair.
The CEO advisory council agreed to add four new specialised committees to oversee audit operations and payments IT and fraud.
“The marketing committee will oversee marketing activities for member banks and will ensure ethical behaviour is observed in advertising as well as truthfulness and transparency in all communications to customers. The committee will also support customer education initiatives and formulate a set of advertising guidelines” the UBF said.
The UBF meeting also discussed a proposal to create a centralised Shariah board that would monitor Islamic banking which could spur the growth of the industry.
“Representatives of the federation’s Islamic banking committee are working closely with the Central Bank on guidelines for the establishment of the new body that will help to ensure consistency among all UAE Islamic banks in their development of new structures and products” it said.
Shariah boards are groups of scholars who rule on whether financial instruments and activities follow religious principles. But the rulings of different boards can be inconsistent or leave scholars open to suggestions of conflicts of interest increasing uncertainty among investors and slowing growth. A centralised Shariah body will help uniformity and consistency. Recently countries including Oman Pakistan Morocco and Nigeria set up centralised Shariah boards that can impose its will nationally.
Bahrain’s central bank is currently drafting legal documentation to set up a Shariah board in a step that could help the market compete with regional rivals.
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.