(Pajhwok): The Islamic Bank of Afghanistan (IBA), the first lender in the country to apply the interest-free principles of Islamic finance in all its operations, was officially inaugurated in Kabul on Tuesday.
Previously known as Bakhtar Bank that operated under a conventional banking license since it was acquired by Azizi Bank in 2009, the IBA was granted the license on April 9 by the central bank, Da Afghanistan Bank.
The bank began converting its assets and deposits in January to adhere to religious principles that include bans on gambling, alcohol and interest-bearing debt.
IBA’s current products include a mudaraba savings account, a form of investment management partnership, as well as financing products based on ijara, an installment-based leasing contract.
It plans to introduce wealth management products and launch new digital banking services in coming months.
Mirwais Azizi, general director of Azizi Group, during the IBA inauguration, said that Bakhtar Bank, offering modern banking services, was created 10 years ago by the Azizi Group.
Later, Bakhtar Bank, for the first time, obtained the license of Islamic banking from the Afghanistan Central Bank before it was officially inaugurated today, he said.
Mohibullah Sharif, religious advisor of Islamic Bank of Afghanistan, said that all rules of Islamic finance would be observed in the bank.
He asked ulema, the government and people of Afghanistan to support the bank and supervise its performance for correction and reform.
Ahmad Zia Rahimzai, the Islamic Bank spokesman, told Pajhwok Afghan News that the bank currently had 1,000 staff and 62 branches across the country.
Chief Executive Officer Abdullah Abdullah during the inauguration ceremony said that creation of the bank was a good move in improving banking in Afghanistan. He asked officials of the bank to be attentive to public trust.
Wrapping up his speech, Abdullah said the Afghan government strongly supported the Islamic Bank of Afghanistan and all other investments.
Mualvi Inayatullah Baligh, religious affairs advisor for the Presidential Palace, appreciated the creation of the first Islamic bank in Afghanistan and said that the Quran and the Hadiths both emphasized on Halal business.
He also asked officials of the bank to adhere to all Islamic rules in the business as what they were promising.
According to the Afghanistan Central Bank, currently three state-run banks (Pashtani Commercial Bank, Milli Bank and New Kabul Bank) and four private banks (Ghazanfar Bank, Maiwand Bank, Afghanistan International Bank and United Bank) are active in Afghanistan.
Afghanistan Central Bank says except Pashtani Commercial Bank and New Kabul Bank, all other banks have Islamic windows.
This Article is Originally Published by www.pajhwok.com