Bangladesh Bank Governor Ahsan H Mansur stated on Saturday that Islamic banking is not merely a religious sentiment but a comprehensive economic system that demands efficiency, transparency, and accountability.
Speaking as the chief guest at the International Islamic Finance and Banking Conference at Dhaka University, Mansur highlighted that more than one-quarter of Bangladesh’s banking assets are now under Shariah-based institutions, reflecting a clear preference by customers.
Despite its growth, the Islamic banking sector faces limited investment opportunities, creating ongoing liquidity management challenges. Mansur noted that without a Shariah-compliant money market or a functional sukuk market, Islamic banks face elevated risks and limited competition.
He suggested that establishing a sukuk market would reduce government financing costs while easing liquidity pressures for Islamic banks, thus stabilising the sector.
Mansur emphasised that Islamic banking, being asset-linked, is one of the safest lending systems. However, weak implementation in Bangladesh, along with vested interests influencing the sector, has led to irregularities, negatively impacting customers and depositors.
He stated that responsibility for these issues lies with regulators, bank management, Shariah boards, and even depositors who failed to monitor the use of their funds.
