The CBN Governor, Sanusi Lamido Sanusi has this image of a courageous and brave man who treads where angels fear to tread. But since the issue of non interest banking came up, he has not mustered enough courage to say the truth. Worse still is that the National Assembly has failed the nation again in that they refused to use the funds allocated to them to conduct research and come up with simple truth about happenings in the country. Sometimes, because most Nigerians also do not read enough literature about a given subject, they engage the CBN Governor in debates and discussions that make no sense. For Sanusi to have appeared before the honourable members of the National Assembly and left without a single question on the burning issue of Islamic banking suggests that the members present did not do enough research before inviting the CBN governor to the house.
The debate going on about whether the non interest banking being spearheaded by the CBN is religious would not have arisen if Nigerians had taken the pains to go through the guidelines the CBN circulated and posted on its website before issuing licences to those who applied for the introduction of the non interest bank in the country. It becomes a deliberate insult on the collective intelligence of Nigerians when the National Assembly, which is supposed to be the voice of the people that elected them, could not engage the CBN governor when he appeared before them. .
The guidelines put forward by the CBN for setting up a non interest bank indicate very clearly that it is an Islamic banking concept to be administered according to Islamic jurisprudence. What the apex bank has failed to disclose is that guideline for non interest banking requires the CBN to set up a Sharia Council within the apex bank.
The guideline said: AThere shall be an advisory committee on non interest banking within the CBN to be called the CBN Shariah Council (CSC), which will be outsourced. The CSC shall advise the CBN on Islamic laws and principles for the purposes of regulating non interest banking business.@ It amounts to public deceit for the CBN to say it is pursuing any other thing than an Islamic banking. It is a bank for the Muslim community in Nigeria which ordinarily should not evoke the kind of emotions we are seeing now. The CBN Governor should be brave enough to say so because the CBN instrument, guiding the setting up of any non interest bank in Nigeria says so explicitly.
In fact those shouting themselves hoarse on this matter should have taken on the CBN when the guidelines were released.
The CBN in the said guideline describing a non interest bank said: AA non interest bank means a bank which transacts banking business, engages in trading, investments and commercial activities, as well as the provision of financial products and services in accordance with the principles and rules of Islamic commercial jurisprudence. A Transactions and contracts under this type of banking are non permissible if they involve: interest; uncertainty or ambiguity relating to the subject matter, terms or conditions; gambling; speculation; unjust enrichment; or exploitation/unfair trade practices.@
May be Sanusi has forgotten so soon that the CBN had said: AGiven the increasing number of banks and other financial institutions desiring to offer Islamic compliant products and services in Nigeria, the Central Bank of Nigeria has developed guidelines for the setting up of such bank. The guidelines, Sanusi=s CBN had said, are issued pursuant to Section 28 (1) (b) of the CBN Act 2007 and the following provisions of BOFIA 1991 (as amended): Sections 55(2); 52; 59(1) (a); 32(1); 61; 23(1). The Guidelines shall be read together with the BOFIA 1991 (as amended), the CBN Act 2007, CAMA (1990) and circulars/guidelines issued by the CBN from time to time.
The CBN in the guideline had said: AA non interest bank must ensure that it=s Memorandum and Articles of Association state that its business operations will be conducted in accordance with the principles and practices applicable to non interest banking. Non interest banks shall be licensed in accordance with the requirements for new banking licence issued by the CBN from time to time. The extant requirements are summarised hereunder:
All licensed banks or promoters wishing to offer non interest banking products and services may operate using any of the following models: Full fledged non interest bank or subsidiary, licensed in accordance with the current guidelines for licensing of banks issued by the CBN; non interest banking branch of a conventional bank; established in line with extant CBN regulation on bank branch expansion non interest banking window of a conventional bank; established in line with CBN guidelines on the introduction of new products and other applicable regulations. Non interest banks may transact business using any of the following instruments or financing modes: Murabaha; Mudarabah; Musharakah; Ijarah; Salam and Parallel Salam; Istisna; Sukuk; Any other financing mode or structure that is Shariah compliant and approved by the CBN.
It is very unfortunate that the apex bank can openly disown its own instrument. Because the same CBN had directed in its guideline that non interest banks shall be recognised by a uniform logo to be designed and approved by the CBN. AThe CBN shall require all the banks= signages and promotional materials to carry the logo to facilitate recognition by consumers. AProduct Literature Before a bank communicates any marketing material to a person; it must ensure that the material states which Shari=a Committee has reviewed the products or services to which the material relates.@ By CBN definition, non interest banking in Nigeria is based on Sharia jurisprudence. It is therefore an Islamic bank, let nobody be deceived.
