By TwoCircles.net Staff Correspondent,
Kochi: Gulfar Muhammedali, renowned NRI businessman, has been chosen as the Chairman of the Islamic Bank set to be begun in Kerala shortly.CK Menon and MA Yusufali are selected as vice-chairmen. The plan is to begin an interest-free financial institution in the model of Islamic banks.
PNC Menon (Shobha Group), PV Abdul Vahab, MP, Muhammed Siddique, PA Ibrahim Haji, T Balakrishnan (principal secretary of the Industries Department) and VKC Mammadu Koya (member of Kerala State Industrial Development Corporation director board) are other promoters. There will be two more promoters, making their total number 12.
Two names have been submitted before the registrar for approval as the name of the company. They are Al Baraka Financial Company and Al Madeena Financial Company. The company will be registered as a Non-Banking Finance Company, and will be transformed into a full-fledged Islamic Bank in future. The Reserve Bank has not yet allowed the opening of Islamic Banks that function as per Shariat rules in the country. At the same time, the central government is also reportedly planning to amend laws to allow Islamic banking in the country.
The company will function in partnership with the Kerala State Industrial Development Corporation and with the cooperation of the Industries Department. Rs 1000 crore is supposed to be the capital required. The KSIDC will buy 11% shares.
Big companies from the Gulf and European countries have reportedly informed their interest to take shares in the company. Doha Bank has come forward to buy shares. Reliance Group had approached the promoters and informed its willingness to buy 74% shares but the promoters reportedly declined it.
The company will distribute the profit made out of investments to the share-holders as per the Shariat rules. The company will give loans for development projects in the state undertaken by the government and private sectors. Loans will not be allowed to anti-Islamic projects like production of liquor. The bank will not pay or receive interest. A Sharia board will be constituted to decide what sort of investments to be made.
The state Finance Minister TM Thomas Isaac had informed the Assembly on Wednesday that the government would set up an Islamic Bank in the state. A high-level meeting regarding the setting up of the bank will be reportedly held in Kozhikode tomorrow. The bank is supposed to come up in Kochi. Registration formalities will be completed this year and the bank will be operational by mid 2010.