IFSB
Follow us:       
 

Press Releases

Press Release > 2021

The IFSB issues Exposure Draft of Technical Note on Recovery and Resolution (TNRR) for Institutions Offering Islamic Financial Services (IIFS)

Date posted: 15 November 2021

Kuala Lumpur, 15 November 2021 - The Islamic Financial Services Board (IFSB) has today issued Exposure Draft of Technical Note-4 on Recovery and Resolution for Institutions Offering Islamic Financial Serviced (ED TN-4) for a 45-day Public Consultation period starting from 15 November 2021 until 29 December 2021, and invites comments from central banks, regulatory and supervisory authorities, international organisations, IIFS, academics and other interested parties.

The aim of ED TN-4 is to complement the existing Financial Stability Board’s (FSB) Key Attributes (KAs) by providing complementary standards and information addressing the idiosyncrasies of Islamic finance and Sharī‘ah compliance requirements applicable to each KA. In addition, the TNRR intends to provide guidance that addresses Sharī‘ah specificities in relation to the high-level recovery and resolution (RR) framework and the recovery planning process for IIFS, which are not covered in the FSB’s KAs.

The primary objective of the TNRR is to facilitate the relevant regulatory and supervisory authorities (RSAs) and other related authorities to establish an effective RR framework, and appropriate tools for its effective implementation, for IIFS in a manner that is fully compliant with Sharī‘ah principles. The foregoing primary objective of the TNRR subsumes the following constituent objectives:

  • to set out the essential measures to carry out effective recovery and resolution planning (RRP) for all IIFS;
  • to support and enable effective resolvability assessments critical for the IIFS; and
  • to ensure Sharī‘ah governance in relation to the RR framework for IIFS.

The TNRR is primarily intended to facilitate the establishment of effective RR frameworks for IIFS as part of the firm-level regulation of full-fledged (i.e. separately incorporated) banks, including both domestic systemically important banks (D-SIBs) and non-DSIBs. These IIFS include, but are not limited to, commercial banks, investment banks and other fund-mobilising institutions, as determined by the respective supervisory and related authorities, that offer services in accordance with Sharī`ah rules and principles.

The scope of the TNRR also includes Islamic banking “windows” (either a branch or a dedicated unit), which are part of a conventional financial institution while providing financial services in a fully Sharī‘ah-compliant manner.

In line with the IFSB due process on the development of Standards and Guidance/Technical Notes, the IFSB will be organising public hearing event to invite and solicit feedback on the Exposure Draft and its contents. Details of these events will be announced in due course. 

The softcopy of ED TN-4 is available on the IFSB website, www.ifsb.org and the IFSB Secretariat invites all interested parties, especially members of the IFSB, to send their comments on ED TN-4 to the Secretariat through email at ifsb_sec@ifsb.org latest by 29 December 2021.


Back to top

Latest Press Release