SBP issues Guidelines for Conversion of a Conventional Bank into an Islamic Bank

In order to promote Islamic banking and facilitate banks desirous of converting their entire banking operations from conventional to Islamic, State Bank of Pakistan (SBP) has developed detailed guidelines for conversion of a conventional bank into an Islamic bank.

The guidelines include eligibility criteria, necessary measures and the process of conversion comprising three stages i.e.

1. In-principle approval to start conversion process,
2. Conversion of existing conventional banking branches into Islamic banking branches
3. Issuance of full-fledged Islamic Bank license.

Banks intending to convert their operations from conventional to Islamic shall submit a detailed application as per enclosed guidelines to Banking Policy & Regulations Department (BPRD), SBP and a copy for information to Islamic Banking Department (IBD), SBP.

Guidelines for Conversion of a Conventional Bank into an Islamic Bank