Muscat - The combined assets of Islamic banks and windows amounted to RO 2.3 billion as of December 31, 2015, representing about 7.5 per cent of total banking system assets in the Sultanate, according to the Central Bank of Oman (CBO). Islamic banking entities provided financing to the extent of RO 1.78 billion outstanding as of December 31, 2015 versus RO 1.05 billion a year earlier. Total customer deposits held with Islamic banks and windows also registered a significant rise over the year to RO 1.54 billion from RO 0.69 billion in the previous year. Core capital and reserves stood at RO 391.3 million at the end of 2015, a rise of 11.6 per cent over the previous year's level, the apex bank said.Describing Islamic banking as a "milestone" in the development of Oman's banking industry, the CBO said: "Within a short span, two full-fledged Islamic banks and six local banks have established dedicated Windows for practicing and offering Islamic banking products.All these institutions have established their own Sharia Supervisory Boards to guide them in Sharia-related matters. Further, as part of strengthening the Sharia Regulatory Framework, a High Sharia Supervisory Board was established in CBO with eminent scholars. The functions of the Board include giving opinion and advice to CBO on Sharia matters relating to Islamic banking business and deciding on issues which are subject of a fiqh dispute between Sharia supervisory boards in licensed banks."Although a relatively late entrant into the world of Sharia-based banking, Oman's Islamic banking industry has benefited immensely from experiences elsewhere around the globe, the CBO said. "The hallmark of the approach has been the adoption of accounting standards of AAOIFI and guidance by IFSB Standards right at the commencement of Islamic banking operations in Oman. There has been considerable increase in the number of branches and assets held by the Islamic banks and Windows," it added in its 2015 Annual Report.

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