Azerbaijan, Baku/ Trend corr I. Khalilova / The National Bank of Azerbaijan (NBA) still insists on impossibility of introduction of banking activities based on 'Islamic banking'. According to the Director of the Loan Organizations Control Department of the NBA, Adyshirin Gasymov, the only bank in Azerbaijan wishing to proceed to full activities resting upon Shariah law (collection of norms regulating behaviour of Muslims) is Kauthar Bank, but it has not officially applied to the NBA in this connection yet.
"Azerbaijani bank legislation corresponds to international standards and it does not envisage licensing of Islamic banking activities," Gasymov said.
According to Gasymov, the permission can be given only after the NBA studies the practice as regards other world countries and the Government approves operation of Islamic banks. For this purpose amendments in the legislation are required.
Gasymov reported that at present Kauthar Bank is operating in accordance with the principles of banking legislation applied in Azerbaijan.
Kauthar Bank is already represented in a number of Islamic organizations. It is a member of the General Council of Islamic Banks and Financial Institutes established by the Islamic Development Bank.
"For the time being we cannot apply only one type of Islamic banking, which is murahaba, as this banking type envisages participation of a bank only in trade operations (purchase of goods for further sale with extra charge)," the head of Kauthar Bank, Eldar Ibrahimov, noted.
The clients of the bank are not only religious pious citizens of Azerbaijan, though bank changed its profile of activities for this purpose.
Kauthar Bank was registered at the Justice Ministry in September 2001 changing its name from Universal Bank to Kauthar Bank. The bank was issued a license with new name in October 2002.