Bismillahir Rahmanir Rahim
An Empirical Study of Performance of
Islamic Banking institutions in Bangladesh with particular
reference to Islami Bank Bangladesh Ltd
Shah Abdul Hannan,
Previous Secretary, Ministry of Financing, Government of Bangladesh and
M. Fariduddin Ahmad
Deputy Executive Chief executive
Islami Traditional bank Bangladesh Limited
SECTION вЂ“ I actually
Banking Scenario in Bangladesh
When Bangladesh came into existence within the 16th Dec, 1971, the banking sector of Bangladesh was in an overall total disarray. Except for two neighborhood banks included in in that case East Pakistan, all the greater local banking companies became inoperational.. Starting with this sort of a humbleВ condition, the Banking Sector of Bangladesh has grown largely.
At present there are 49 Banking companies in Bangladesh. The composition of Financial in Bangladesh is as below:
1 . Nationalized Commercial Banks--- 4
installment payments on your Specialized Banks--- 5
three or more. Private Sector Commercial Financial institutions:
a) Typical Banks---25
b) Islamic Banks--- 5
four. Foreign Industrial Banks
a) Conventional Banks--- 9
b) Islamic Banks--- 1
SECTION вЂ“ II
Genesis of Islamic Banking in Bangladesh
In August 1974, Bangladesh signed the Charter of Islamic Creation Bank and committed by itself to reorganize its financial and economic climate as per Islamic Shariah.
In January 81, the then simply President of People's Republic of Bangladesh while handling the 3rd Islamic Summit Seminar held in Makkah and Taif advised, " The Islamic countries should develop a separate bank system of their own in order to assist in their trade and business. вЂќ
This kind of statement of the President indicated favourable attitude of the Federal government of the Someones Republic of Bangladesh towards establishing Islamic banks and financial institutions in the area.
Earlier in November 80, Bangladesh Lender, the country's Central Traditional bank, sent a representative to study the significant of several Islamic financial institutions abroad.
In November 1982, a abordnung of IDB visited Bangladesh and confirmed keen fascination to take part in establishing a joint venture Islamic Bank inside the private sector. They found a lot of work had already been done and Islamic bank was in a ready form for immediate launch. Two professional bodies Islamic Economics Study Bureau (IERB) and Bangladesh Islamic Bankers Association (BIBA) made significant contributions to introduction of Islamic bank in the country.
They will came forward to provide training on Islamic banking to top bankers and economic analysts to fill-up the cleaner of leadership for the future Islamic banks in Bangladesh. Additionally, they held workshops, symposia and workshops on Islamic economics and bank throughout the nation to mobilize public view in favour of Islamic banking.
Their particular professional activities were sturdy by a quantity of Muslim internet marketers working under the aegis of then Muslim Businessmen Culture (now reorganised as Industrialist & Business people Association). Your body concentrated mainly in mobilising equity capital for the emerging Islamic bank.
At last, the very long drawn find it difficult to establish a great Islamic bank in Bangladesh became a reality and Islami Bank Bangladesh Limited began on thirtieth March, 1983 in which nineteen Bangladeshi countrywide, 4 Bangladeshi institutions and 11 banks, financial institutions and government bodies of the Middle East and European countries including IDB and two eminent personas of the Kingdom of Saudi Arabia joined hands to make the fantasy a reality.
After, other a few Islamic Banking companies were established in the country. 7 conventional banks have until now established Islamic Banking divisions in some key cities.
SECTION вЂ“ 3
Comparative Location of Islamic Banking and Conventional Bank in Bangladesh.
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