The Bangko Sentral ng Pilipinas (BSP), Department of Finance, National Commission on Muslim Filipinos, and the Bangsamoro Government approved the Joint Circular (JC) and Memorandum of Agreement (MOA) on the establishment of the Shari’ah Supervisory Board (SSB) in the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM).
This marks a milestone in the whole-of-government approach in promoting Islamic banking and finance in the country.
“The JC and MOA formalize the agencies’ collaborative efforts in Shari’ah governance, following the government’s strategy to provide an enabling environment for the Islamic banking industry. The SSB will provide essential Shari’ah compliance oversight to enable Islamic finance to flourish in the country,” said BSP Governor Benjamin E. Diokno.
The joint initiative implements relevant provisions of Republic Act No. 11054 (An Act Providing for an Organic Law for the Autonomous Region in Muslim Mindanao) on the promotion of Islamic banking and finance in the BARMM.
The SSB’s primary function is to issue Shari’ah opinions on Islamic banking transactions and products in the BARMM.
At the same time, the BSP, financial institutions, and other stakeholders may request the SSB to provide Shari’ah opinions on matters related to Islamic banking and finance.
The SSB complements the Shari’ah Advisory Council of Islamic banks required under the BSP’s licensing and Shari’ah governance frameworks, under BSP Circular Nos. 1069 and 1070 dated 27 December 2019.
“Republic Act No. 11439 or the Islamic Banking Law provides flexibility for the government to convert the SSB into a national body, if warranted, such as when there is already a critical number of Islamic banking players in the financial system.” the Governor explained.