The IFSB issues Exposure Draft on Core Principles for Effective Islamic Deposit Insurance Systems (CPIDIS)
Date posted: 22 May 2019
22 May 2019, Kuala Lumpur, Malaysia – The Islamic Financial Services Board (IFSB) has issued today the Exposure Draft on Core Principles for Effective Islamic Deposit Insurance Systems (CPIDIS) for a one-and-half months Public Consultation period starting 22 May 2019 until 5 July 2019, and invites comments from central banks, regulatory and supervisory authorities, deposit insurance organisations, international organisations, institutions offering Islamic financial services (IIFS), academics and other interested parties.
The main objective of the CPIDIS is to provide a set of core principles for the development and implementation of an effective Islamic deposit insurance system (IDIS), taking into consideration the specificities of Islamic banks, while complementing the existing international standards, principally the International Association of Deposit Insurers (IADI) Core Principles for Effective Deposit Insurance Systems (November 2014). In particular, the objectives of the CPIDIS are to:
- serve as a benchmark international framework to facilitate the development and implementation of effective IDIS;
- enable the existing IDISs to identify best-practice gaps in their current modalities; and
- facilitate an independent, third-party or self-assessment of the compliance of an IDIS with CPIDIS.
The CPIDIS has been jointly developed by the IFSB in collaboration with the IADI. The IADI and IFSB envisage that jurisdictions will use these CPIDIS and their compliance assessment methodology as a benchmark for assessing the quality of their IDIS and for identifying gaps in their Islamic deposit insurance practices, including measures to address them. Overall, the CPIDIS will promote further integration of Islamic deposit insurance with the international architecture for financial stability.
In line with the IFSB due process for developing standards, the IFSB will be organising a public hearing on 18 June 2019 in Kuala Lumpur, Malaysia to invite and solicit feedback on the Exposure Draft and its contents. A Webinar will also be held on 19 June 2019, details of which will be announced in due course. Participation in the Public Hearing and Webinar is free and open to all. In parallel, the IADI will also be conducting a public consultation exercise with its members and target audience, in line with its internal due process. In due course, both IADI and IFSB Secretariats will consolidate the public consultation feedback and work towards the final version of the CPIDIS.
The softcopy of ED CPIDIS is available on the IFSB website, www.ifsb.org and the Secretariat invites all interested parties, especially members of the IFSB, to send their comments on ED CPIDIS to the project team through email at firstname.lastname@example.org latest by 5 July 2019.
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