Kuwait (UNA) – The Islamic Development Bank Institute, in cooperation with the IMF’s Middle East Center for Economics and Finance, concluded its first joint workshop, which was held in Kuwait City from September 6 to 10, 2026.
The five-day workshop, entitled “Reflections of Basel III Standards on Capital Adequacy in Islamic Banks,” attracted a select group of senior officials and specialists from central banks and finance ministries in the region. Its sessions were moderated by Dr. Abu Dhar Muhammad, Senior Specialist in Islamic Finance at the Islamic Development Bank Institute, focusing on the fundamental considerations related to capital adequacy that have arisen following the application of “Basel III” standards to Islamic banking institutions.
The workshop deepened participants' understanding of the regulatory capital framework and its implications for Islamic banks, including the components of regulatory capital, regulatory adjustments and deductions, capital buffers, risk-weighted assets, and mechanisms for calculating capital requirements for credit, market, and operational risks. The sessions also addressed leverage ratios and key aspects related to assessing the soundness and financial health of Islamic banking institutions.
Representatives from the central banks and finance ministries of Libya, Mauritania and Somalia participated in the event, in addition to the Palestinian Monetary Authority and the central banks of Yemen, Syria, Oman and Kuwait. The diverse attendance provided an opportunity to exchange experiences and discuss the regulatory and supervisory challenges related to capital adequacy in different countries.
The program began with opening remarks by Dr. Sami Ben Nasser, Director of the IMF's Middle East Center for Economics and Finance, and Dr. Abu Dhar Mohammed, Senior Islamic Finance Specialist at the Institute. The opening session highlighted the importance of capacity building and knowledge sharing in enhancing the resilience of the financial sector and supporting the effective implementation of international regulatory standards in Islamic finance.
This workshop represents an important step towards strengthening cooperation between the two institutions in the areas of capacity building in Islamic finance and financial sector regulation, as it is an ideal platform for regulators and policymakers to deepen knowledge and link the requirements of “Basel 3” with the distinctive characteristics of Islamic banking.
Over five days, attendees participated in specialized presentations, practical exercises, real-world case studies, and in-depth discussions specifically designed to translate regulatory concepts into practical calculations of capital adequacy, highlighting the challenges faced by regulators when implementing risk-based capital requirements, and taking into account the distinctive characteristics of Sharia-compliant financial instruments and business models.
The participants provided an overview of the regulatory capital framework in their respective countries, highlighting key regulatory requirements, supervisory practices, and the main challenges they face in implementing capital adequacy standards for Islamic banks.
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