Law

Permanent URI for this collection

http://etd.aau.edu.et/handle/123456789/102

Browse

Browsing Law by Author "Abay, Solomon(Associate Professor)"

Now showing 1 - 1 of 1
  • No Thumbnail Available
    Item
    Introdudicing Policy and Regulatory Framework for Accomodation of Islamic Banking in Ethiopia
    (Addis Ababa, 2020) Mohammed, Melika; Abay, Solomon(Associate Professor)
    The accommodation of Islamic banking has to be accompanied by the development of efficient and effective Policy, regulatory and supervisory framework. Historically, Islamic banks operated under the conventional setup, but with the expansion of the Islamic banking industry, countries have adopted separate regulatory structures based on their institutional setup and market dynamics. This segregation of regulatory frameworks establishes the need for separate governance structures, given that the socially responsible objectives and operational efficiency of Islamic banking cannot be achieved under conventional setups. International agreements such as the Basel core principles which aim to provide level-playing field regulations for all banks, in fact, do not take into account the nature of the Islamic banking, hence IFSB standards, Guidelines and core principles were established to compliment the lack of level playing field regulations in BCPs. The countries which accommodate Islamic banking are also adopting these adjusted standards while developing their regulatory framework. This research paper examines the exiting Ethiopian policy, regulatory and supervisory framework for Islamic banking by taking in to account the international standards and countries experiences. The core purpose of the study is to identify and disclose major policy, regulatory and supervisory gaps, loopholes and challenges. The study was conducted mainly based on regulatory and supervisory analysis, interview and benchmarking international experiences. The findings of the study revealed that yet the country did not yet develop the regulatory, supervisory and institutional framework that enable Islamic banking to operate on a level playing field. Based on the result of the study, this paper opted to introduce appropriate policy, regulatory and supervisory framework for the industry. Having this in mind, it focuses on the proposals and possible recommendations.