The monetary issuing institution in Central Africa is seeking a consultant to develop a legal and regulatory framework for the supervision of Islamic finance activities.
By Achille Mbog Pibasso
The Bank of Central African States (BEAC) is seeking, through the Regional Financial Institutions Capacity Building Project (PRCIFR) of the Economic and Monetary Community of Central Africa (CEMAC), consultancy services for development of a legal and regulatory framework for the supervision of Islamic finance activities for the benefit of the Central African Banking Commission (COBAC).
For the realization of this project, BEAC requested a loan and a grant from the World Bank Group (WB) through the International Development Association (IDA) to finance the Capacity Building Project for Regional Financial Institutions of the World Bank. CEMAC, and intends to use part of the grant to make payments under the consulting services contract for the development of a legal and regulatory framework for the supervision of Islamic finance activities by the secretariat General of COBAC “.
The missions devolved to the consultant are justified in particular by the fact that “the development of Islamic finance becomes important in some countries of the CEMAC, particularly in Cameroon and Chad and not necessarily banked,” says the Central Bank.
According to the BEAC, this regulation makes perfect sense “while there is no legal framework in the CEMAC zone for the exercise of Islamic finance, several credit or microfinance institutions have taken the initiative to enter into contact with COBAC in order to formalize an “Islamic window” offer in addition to their traditional banking business.
The BEAC also specifies that the current COBAC supervision system was built to supervise conventional credit and microfinance institutions, which did not provide for specific rules for products, let alone for Islamic finance institutions. .
Avoid development anarchic financing
Consequently, “the prospect of creating an Islamic credit or microfinance institution or the application for authorization to carry out certain purely Islamic activities in the CEMAC could pose legal and regulatory problems,” notes the institution. monetary issue in Central Africa.
In this context, “to avoid an anarchic development of Islamic finance,” COBAC decided to develop a legal and regulatory framework for the exercise and supervision of the activities and products of Islamic finance. It is for this reason that the banking sector regulator in Central Africa intends to hire the services of a consultant whose mission aims to identify the needs of Islamic finance, to propose a legal and regulatory framework. appropriate for its supervision and to meet the initial expectations of training.
A consultant who should, among other things, have a thorough knowledge of international standards and good practices in banking supervision and Islamic institutions, a good knowledge of the standards issued by the Islamic Financial Services Board and the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), proven experience in the supervision of Islamic financial institutions or in organizations or entities known in the field of Islamic finance, good knowledge of risk management and control in the Islamic sector, good mastery of the implementation of Basel 2 and Basel 3 as prescribed by the IFSB.
In addition, for having managed or supervised the implementation or elaborated a regulatory framework for the supervision of Islamic finance, he recommended to him the experience of working in a supervisory or banking regulatory body and the control of the IFRS standards of as well as knowledge of the legal framework of the Uniform Acts of the Organization for the Harmonization of Business (OHADA) and the control of the economic and financial environment of CEMAC.
