The Asian Development Bank (ADB) in coordination with the Bangko Sentral ng Pilipinas (BSP) and the Islamic Finance Advisory Assurance Services (IFAAS) successfully conducted a series of capacity-building workshops on Islamic banking and finance from 21 October to 13 December 2024.

The workshop series is part of the culmination of collaboration between ADB and BSP for almost 7 years under the Technical Assistance Agreement with ADB to promote Islamic banking and finance. The training courses aimed at enhancing expertise and practical understanding of Islamic financial principles and practices, covered both foundational and intermediate courses on Islamic banking, takaful, Islamic capital markets, monetary operations framework, Shari’ah audit, Shari’ah standards and accounting standards on various Islamic financial products and services. Participants to these workshops include representatives from key government agencies, Islamic organizations, banking institutions, and audit and accounting firms.

Pru Life UK (Philippines) formally launches the first takaful operation in the Philippines on 4 November 2024 at the Manila Hotel, marking a milestone in the Philippine insurance industry, as Pru Life becomes one of the country’s first takaful operators licensed by the Insurance Commission, paving the way for Shari’ah-compliant insurance. The event is participated by market stakeholders, including the Bangko Sentral ng Pilipinas, represented by Monetary Board Member Jose L. Querubin, Financial Supervision Sector Deputy Governor Chuchi G. Fonacier, and Islamic Banking Supervision Group Deputy Director Atty. Noel P. Tianela.

The Shari'ah Supervisory Board (SSB) in the Bangsamoro Autonomous Region in Muslim Mindanao, during its fourth regular meeting held on 07 October 2024, welcomed Dr. Anwar M. Radiamoda as new member to complete the nine-member SSB. The meeting also discussed the draft guidelines for handling requests for SSB opinions. It also featured an executive presentation on the Islamic banking unit (IBU) operations of Maybank Philippines, Inc., the first commercial bank to be granted an IBU license.

The Shari’ah Supervisory Board (SSB) in the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM), during its third regular meeting held on 10 July 2024, featured the executive briefing by Mr. Mohammad Farrukh Raza, Founder and Group Chief Executive Officer of Islamic Finance Advisory and Assurance Services (IFAAS) and Chairman of the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) Governance and Ethics Board. The briefing provided the SSB with invaluable insights into the processes of issuing Shari'ah opinions, conducting Shari’ah reviews, and decision-making practices in various global jurisdictions, among others.

The Shari’ah Supervisory Board (SSB) in the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) conducted its second regular meeting on 20 February 2024 with the adoption of SSB By-Laws and official logo which covered key components of governance and operational framework. The meeting also featured an executive presentation on the Islamic banking operation of the Card Bank, Inc. (A Microfinance - Oriented Rural Bank), the first conventional bank in the Philippines granted an Islamic banking unit license.

To reinforce the collaboration with stakeholders in promoting Islamic banking and finance, the Bangko Sentral ng Pilipinas (BSP) and Asian Development Bank (ADB), in coordination with the Islamic Finance Advisory and Assurance Services (IFAAS) , conducted workshops on Islamic Microfinance and Sukuk on 13 and 14 March 2023, respectively, at the Joy Nostalg Hotel and Suites Manila, Ortigas, Pasig, Metro Manila. The workshops were attended by representatives from the BSP, the National Commission on Muslim Filipinos (NCMF), the Securities and Exchange Commission (SEC), the Bureau of Internal Revenue (BIR), and the Bureau of the Treasury (BTr), among others with learnings to provide insights and feed into the ongoing initiatives/projects and policies/regulations of the attending agencies. Mr. Tahir Ebrahim of the IFAAS facilitated the workshops.

The workshops were preceded by technical dialogue sessions by the Islamic finance expert with domestic market players and regulators on 8 and 10 March 2023, respectively, with platform to discuss the operations of an Islamic Bank and Islamic Banking unit (IBU) in the areas of profitability, resource requirement, impact of IBU to conventional banking operations, among others. Meanwhile, representatives from the BSP, Bureau of the Treasury and Bangsamoro Government brainstormed on other Islamic banking and finance initiatives and action plans during the regulators dialogue.

In this video, Bangko Sentral ng Pilipinas (BSP) Assistant Governor Arifa Ala identifies how Islamic finance and microfinance promotes financial inclusion for all Filipinos.

AG Ala says Islamic finance provides Muslims with Shari’ah-compliant products and services. It also serves as an alternative investment and financing option for non-Muslims.

Likewise, the Assistant Governor adds that Islamic microfinance can complement existing microfinance institutions in serving the needs of low-income households and other economically marginalized sectors, including Muslim communities.

In this interview, officials from the Bangko Sentral ng Pilipinas (BSP) and the Philippine Economic Zone Authority (PEZA) share their initiatives to promote Islamic finance in the country.

BSP Assistant Governor Arifa Ala says the central bank aims to establish a level playing field for conventional and Islamic banks to effectively respond to the financial needs of Muslims and non-Muslims alike.

Meanwhile, PEZA Deputy Director General Aleem Siddiqui Guiapal says the presence of Islamic banks in the Philippines will spur additional investments in economic zones, consistent with the government's overarching goal of job generation and economic growth.

To further support the Islamic finance scene in the Philippines, BSP representatives and other member-agencies of the Islamic Finance Coordination Forum (IFCF) participated in the Islamic finance refresher course conducted by the Asian Development Bank-Islamic Finance Advisory Assurance Services (ADB-IFAAS) on 24 to 27 October 2022. The course intends to firm up the attendees’ knowledge on Islamic finance, capturing learning during the previous ADB-IFAAS workshop in 2019 to 2020. Similarly, the ADB-IFAAS organized the central bank facilities workshop on 28 October of the same year. This time, BSP representatives were joined by participants from the Bureau of Treasury. The workshop covered special topics on central bank financial facilities for Islamic banks as well as Shari’ah-compliant financial instruments in monetary operations.

Collectively known as the founding agencies, the Bangko Sentral ng Pilipinas (BSP), Department of Finance, the Bangsamoro government, and the National Commission on Muslim Filipinos, signed a memorandum of agreement creating the Shari’ah Supervisory Board (SSB) on 4 May 2022. The establishment of the SSB will help ensure the observance of the Shari’ah-compliance oversight framework in Islamic banking and finance matters in the country. The SSB is comprised of one representative from each of the founding agencies and five members from the private sector.

To promote and encourage Islamic banking and finance in the Philippines, the BSP and the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) signed a memorandum of understanding (MOU) on 1 December 2021 covering the potential adoption of AAOIFI standards in the local Islamic banking and finance sector. The MOU also details areas of cooperation in terms of capacity building and technical assistance for the industry.

The BSP signed on 19 October 2021 a Memorandum of Understanding (MOU) with the Philippine Economic Zone Authority (PEZA) to foster collaboration in the promotion of Islamic banking and finance through the establishment of Green Ecozones, Halal Hubs and provision of access to Shari’ah-compliant products and services in halal ecozones.

BSP representatives attended a series of Islamic banking and finance workshops from September 2019 to July 2020—organized by the Asian Development Bank, in coordination with the BSP and IFAAS. Other members of the interagency working group on Islamic banking and finance also participated in the workshop series, which was conducted under a hybrid setup—via on-site and online platforms.

The BSP hosted a technical assistance workshop for Islamic banking and finance from 10 to 11 May 2017. This workshop was organized to guide both the BSP and its partner agencies in crafting a comprehensive regulatory framework for Islamic finance. The said framework helps enhance the BSP’s oversight and policy-making functions over Islamic banks.

Hosted by the BSP in Manila on October 2016, the Islamic Financial Services Board (IFSB) conducted a three-day workshop for the banking sector to discuss the implementation of IFSB standards in the country. The workshop was attended by 73 participants comprised of delegates from the BSP, select government agencies, and other banking institutions. The IFSB standards tackled during the workshop include guidelines for risk management, governance systems, and supervisory review processes of institutions offering Islamic financial services.

The BSP sponsored an Islamic banking and finance workshop on 9 to 10 June 2014 which featured speakers from the World Bank. The workshop was aimed at providing BSP with assistance in addressing issues with regard to determining a suitable and legal regulatory framework for Islamic banking in the country. This was part of the efforts to put up an enabling regulatory environment for the growth of Islamic banking and finance in the country.

The BSP, in partnership with the Philippine Center for Islam and Democracy and the Foundation for Economic Freedom, held a thematic series of workshops on 11 to 12 March 2014 to provide a clear picture of the state of banking and finance in BARMM. The workshop also served as an avenue for participants to gain a basic understanding of Islamic banking fundamentals, capital markets, and microfinance. Legal constraints, as well as alternative regulatory and governance arrangements on Islamic banking and finance, were likewise explored during the workshop series.