Standard Chartered Bank To Encourage Islamic Banking In Nigeria and Oman

Standard Chartered is in discussions with regulators to offer Islamic banking services in Oman and Nigeria, now that both countries are revamping their regulatory environments to encourage Islamic finance, the bank’s global head of Islamic banking on Sunday. According to Reuters

Wasim Saifi said the company, which already has a strong conventional presence in both markets, was waiting for the countries to finalise their regulatory frameworks for Islamic banking but could offer the services in Oman and Nigeria as early as next year.

“We are definitely evaluating the possibility of offering Islamic banking in Oman and Nigeria,” Saifi told reporters. “The opportunity is tremendous. We are in discussions with regulators.”

Oman said in May that it would open the door to Islamic banking and let conventional lenders run sharia-compliant operations in a bid to keep investment funds in the Gulf state. The central bank has given banking licences to two new banks under formation.

Nigeria’s central bank has been pushing to boost Islamic banking in West Africa’s largest economy. The central bank has approved the creation of the country’s first Islamic bank, Jaiz Bank, and Nigeria will seek to launch a debut sovereign sukuk in the next year.

Saifi said that as Islamic banking was growing in sophistication, the gap between conventional and Islamic finance was narrowing and the industry would take more market share from the traditional banking sector.

Standard Chartered Saadiq, the Islamic arm of the bank, expects Islamic banking assets within the United Arab Emirates alone to grow to 20 percent of the total sector in 2012 from an estimated 18 percent this year.

Saifi said the company was looking also to increase its offerings in Islamic wealth management, which lags the conventional industry.

“We are working closely with our external vendors on the Islamic side to make sure our offerings are beefed up there.”