COLOMBO Feb 2 Sri Lanka's Amana Bank ATL.CM on Wednesday said it had received central bank approval to start the island nation's first Islamic commercial bank.
The bank is expected to start banking operations this year, this year, Managing Director and CEO Faizal Salieh said in a statement.
"Amana Bank will be Sri Lanka's first licensed commercial bank to conduct all its business operations in complete harmony with the principles of Islamic banking," the bank said in a statement.
Over the last 10 years, Amana developed its insurance and investment divisions as it prepared to become a bank.
Analysts estimate the island nation's Islamic finance industry has a potential to become a $1.5 billion business, given appropriate tax and other laws approved by Sri Lankan government based on Shari'ah, the Islamic legal system.
Muslims make up about 8 percent of Sri Lanka's 21 million people.
The bank's shareholding amounts to 3.4 billion rupees ($30.6 million), Amana's statement said.
Bank Islam Malaysia Berhad accounts for 20 percent of Amana's strategic investments, while AB Bank, Bangladesh, has a stake of 15 percent and Saudi Arabia'a Islamic Development Bank has a 10 percent shareholding. (Reporting by Shihar Aneez; Editing by Bryson Hull)