IFSB-FIS Workshop Series (Abu Dhabi)

This 4-day Facilitating the Implementation of the IFSB Standards (FIS) Workshop is tailored for the regulatory and supervisory authorities for the banking sector. It will be hosted by the Arab Monetary Fund (AMF) and will discuss the following IFSB Standards:

As a background, IFSB-1: Guiding Principles of Risk Management provides a set of guidelines of best practices for establishing and implementing effective risk management in IIFS. In particular, the Standard sets out 15 principles for managing the risks inherent in Sharī`ah-compliant financial businesses.

IFSB-15: Revised Capital Adequacy Standard, for its part, includes implementation of an optimal capital adequacy framework to facilitate the effective coverage of risk exposures of the IIFS as well as the allocation of appropriate capital to cover these risks in a manner that is based predominantly on the Standardised Approach. This Standard also provides guidance on the features and criteria for high-quality regulatory capital components, including Additional Tier 1 and Tier 2, which comply with Sharī`ah rules and principles.

IFSB-22: on Disclosures to Promote Transparency and Market Discipline for IIFS, for its part, considers disclosure-aspects relevant to consumer protection and sets key point-of-sale disclosure requirements. The disclosure principles and practices suggested by this Standard widen the scope of IFSB-4 and are designed to enable market participants and IAH to assess several key information. This information include, among others the type of IIFS, capital structure, treatment of investment accounts, including their risks and returns, risk exposures, key aspects of general governance and Sharī`ah governance, consumer protection and others.

In addition, the workshop will shed light on the IFSB Working Papers on ‘Strengthening the Financial Safety Net: The Role and Mechanisms of SCDIS’ (WP-06) and the Expousre Draft on Guidance Note on Sharī`ah Compliant Lender of Last Resort Facilities (GN-7).

Overall, this Workshop intends to be a Train the Trainer programme for the staff of regulatory and supervisory authorities on the IFSB Standards, and aims to:

1. Enhance the participants’ understanding of the respective Standards and Guiding Principles thereby facilitating the implementation of these standards in their respective jurisdictions;

2. Assist the participants in the practical application of issues addressed in the particular standards through case studies, hands-on exercises and other interactive tools; and

3. Promote the sharing of experiences among the participants on the implementation of respective IFSB Standards and Guiding Principles.