Page 75 - Annual Report 2016 EN

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Prudential banking framework
– securitisation

Over the last three years, the Regulatory Authority embarked on
a phased upgrade of its prudential banking framework, reflected
in the introduction of the Banking Business Prudential Rules 2015
(BANK) and the Islamic Banking Business Prudential Rules 2016
(IBANK). The aims of the reforms to the prudential banking frame-
work were to align with the published international regulatory
standards of the Basel Committee on Banking Supervision and the
Islamic Financial Services Board and the prudential framework of
the Qatar Central Bank.

In that connection, in 2016 the Regulatory Authority began a com-
prehensive review of the prudential framework for securitisation.
In December 2016, the Regulatory Authority published for public
consultation its proposed rule amendments for both Sukuk and
conventional securitisation. The primary aims of the proposed
amendments are to require firms to implement a prudent frame-
work that addresses the risks associated with securitisation and to
ensure that sufficient regulatory capital is held against any associ-
ated credit risk.

Islamic finance knowledge development

As part of the Regulatory Authority’s ongoing reforms to its pruden-
tial banking framework, a key priority has been to upgrade its skills,
knowledge and experience in the area of Islamic finance. In the
past three years, Regulatory Authority staff have taken extensive
training with organisations such as the International Monetary Fund
and the Islamic Financial Services Board to develop core skills and
knowledge in Islamic finance.
This programme of training has contributed significantly to the Reg-
ulatory Authority’s capacity and ability to develop the IBANK rules.
The Regulatory Authority’s work on IBANK has been recognised by
regional regulators, the Asian Development Bank and the Islamic
Financial Services Board as a regulatory model on which other reg-
ulators could base their own Islamic banking prudential rules and
regulations. As a result, Regulatory Authority staff were invited to
speak to regulatory bodies and professional organisations on their
experience of developing an Islamic banking framework.