njuguna ndung ’ u : the future of sharia compliant banking and finance in kenya address by prof njuguna ndung ’ u, governor of the central bank of kenya, at the official launch of the national bank of kenya ’ s sharia compliant banking “ the national amanah ”, nairobi, 29 april 2013. * * * board of directors of national bank of kenya limited here present, mr. mohamed a. hassan, chairman, national bank of kenya mr. munir ahmed, managing director, national bank of kenya, distinguished guests, ladies and gentlemen : i am delighted and honored to have been invited to preside over the official launch of the rebranded sharia compliant banking window of national bank. allow me at the onset to congratulate national bank for this relaunch of the two sharia compliant products to be offered under the new brand name of “ national amanah ”. this will no doubt enable the bank reach out to more of the unbanked in our country. this will not only grow the deposit base but also enhance the government ’ s goal of financial inclusion for all kenyans. ladies and gentlemen : sharia compliant banking and finance has evolved to become an integral part of global financial system transcending geographical boundaries from asia, to the middle east, to europe, americas and africa. the assets worldwide have expanded from some us $ 150 billion in the 1990s to us $ 1. 3 trillion by 2011. this was expected to have reached us $ 1. 6 trillion by end of last year. although sharia compliant banking industry currently only constitutes 1. 6 % of the total assets of the top 50 largest banks in the world, it remains one of the fastest growing segments in the global financial services sector. the sharia compliant banking industry is expected to witness further development particularly in terms of development of new products as well as opening up of new markets, in light of the industry ’ s resilience during the global financial crisis of 2007 / 2008. there must be important characteristics of sharia compliant products that we should learn. at the local level too, sharia compliant banking is notably beginning to take root. kenya currently has two fully fledged shariah compliant banks and a number of conventional banks have been granted approval to roll out shariah compliant products. kenya has also pioneered in the sharia compliant insurance and re - insurance segments. the government, through finance act 2010, amended section 45 of the central bank act, to allow for

points per year, or about $ 4. 5 billion, if interprovincial trade barriers were lowered. this would include harmonizing regulations on all manner of things. in a time of slow economic growth, that is too good an opportunity to pass up. conclusion it is time for me to conclude. clearly, there are challenges in the canadian and global economies that we need to manage. but there are clear signs that canada is adjusting to the challenges. after taking into account the economy ’ s structural adjustment to lower oil prices that is still going on, we can see many areas of encouraging economic growth. these are both traditional and cutting - edge, and are exportoriented. canada ’ s portfolio of trade agreements should serve us well as this story unfolds, despite the uncertainties the world faces today. 5 / 6 bis central bankers'speeches that being said, it is clear that the global economy is performing less well than we believed only a few months ago, and canada is feeling the effects. in addition, our housing sector is taking longer than previously expected to digest the combined effects of stricter mortgage guidelines and higher interest rates. that is why we said at our last interest rate announcement in march that the economic outlook continues to warrant a policy interest rate that is below the neutral range, to help the economy work through this downshift in growth and keep inflation close to target. recent economic data have been generally consistent with our expectation that the period of below - potential growth will prove to be temporary. our next interest rate announcement and monetary policy report will be released on april 24, and i can promise a fuller analysis at that time. for now, let me thank you for your kind attention, and for your wonderful hospitality here in iqaluit. 6 / 6 bis central bankers'speeches