THE HOUSE of Representatives, via voice voting, approved on second reading on Tuesday a bill proposing to establish a regulatory framework for Islamic banks.
House Bill 8281, An Act Providing for the Regulation and Organization of Islamic Banks, mandates the Bangko Sentral ng Pilipinas (BSP) to supervise, license and regulate Islamic banks like universal banks.
“With this imminent new law, there will be more Islamic banks not just for Mindanao but also for the rest of the country,” Leyte-2nd district Rep. Henry C. Ong, who also chairs the House Committee on Banks and Financial Intermediaries, said in a statement.
“The establishment of more Islamic banks, especially those based here in Southeast Asia and in the Middle East, will make available to the Filipino people, especially the over 10 million Filipino Muslims, a vast array of banking, lending, and investment products and services.”
The bill authorizes the establishment of Islamic banks and allows conventional banks to engage in Islamic banking, provided that these lenders put in place a system that will segregate their Islamic banking units from their regular business.
Under the measure, Islamic banks are allowed to perform banking services, such as in accepting or creating current, savings accounts, and investment accounts, accept foreign currency deposits, and act as correspondent banks and institutions among others.
The banks shall also constitute a Shari’ah Advisory Council to render advice and review applications of the Shari’ah principle.
The bill also states that tax treatment between Islamic banking transactions and equivalent conventional banking transactions should remain neutral. — C.A. Tadalan