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EDUCATION

Career opportunities

Muhammad ArsalanAqeeq takes Pakistan as a case study for


developing an education system that would provide the Islamic
finance industry with the skills it so desperately needs

e live in an age of
specialisation, where
human
resources
can capitalise on the
opportunities created by the demand
and supply of skilled professionals.
Islamic
finance
practitioners,
academia and training industry in
Pakistan are very well positioned to
make the most out of it.
Higher education institutions,
being one of the major producers of
human resources to Islamic financial
institutions (IFIs), ought to train,
create awareness and provide career
orientation to their graduates to exploit
careers in IFIs locally as well as globally.
As a qualified and experienced
Islamic banker, I have attempted to
envisage the state of the local and
international Islamic banking industry,
including growth dynamics, human
resourcing requirements, functional
roles and the challenges ahead for
the Islamic banking industry. In this
article, I have tried to map out skill
requirements and the underlying career
opportunities for potential employees
and young graduates, and employers in
Pakistan as well as in the GCC.

INDUSTRY AT HOME

Pakistans Islamic banking industry


surfaced in 2001 and claims to be a PKR
711.00 billion (approx $7.00 billion)
industry comprising five indigenous
banks and 12 Islamic windows with a
branch network of 964 branches, 500
windows and a nationwide presence.
Pakistans nascent industry has a
YoY growth rate of 30 per cent. This
growth has been galvanised by optimal

Muhammad ArsalanAqeeq

profitability with Return On Equity of


15 per cent.

GROWING DEMAND

Reportedly, bankers, economists


and investors are moving towards
an Islamic economic system because
they have realised that this emerging
system can be an alternative after a
capitalist system has harmed so many.
Moreover, S&P highlights a
dazzling growth potential for Islamic
banking, thanks to a young, fast-

growing Muslim population, robust


macroeconomic environments, large
infrastructure projects that require
financing, formation of Shariahcompliant indices for companies listed
in stock markets and recent political
developments in several Muslimmajority countries.
In 2008, the State Bank of
Pakistan (SBP) in its five-year strategic
plan, stressed the importance of
strengthening human resources to
eventually strengthen Islamic banking.
cont. overleaf

www.cpifinancial.net

ISSUE 78 | Islamic Business & Finance

41

EDUCATION
cont. from pg41

As with all developing sectors, the


Islamic Banking Industry (IBI) also
suffers from a lack of candidates
specifically trained in Islamic banking.
Conservative estimates based on
the methodology adapted by SBP
strategic plan 2008-2012 project that
the industry will need 22,000 qualified
personnel by 2017, as compared to the
15,000 currently available. Based on
international best practices the 22,000
employees needed by 2017 translates to
one per cent, or 200 senior managers,
15 per cent or 3000 mid-level managers
and 84 per cent or 16,800 front line or
field staff. This defines the capacity
needed for developing the different
levels of human resources.
In order to meet the specific
requirements of the industry that focus
on relevant areas at multiple levels,
there is a need to have a specialised
institution in the country that caters to
specific industry requirements and is
structured to provide focus in specific
areas. Higher education institutions
and business schools need to realise and
tap the potential of the Islamic finance
industry and its appetite for qualified
Islamic bankers. Higher education
institutions are expected to roll-out
internationally accredited academic
and professional qualifications and
programmes to facilitate the industry
in developing the human resources
which it needs to be sustainable.

Estimated Human Resource


Requirement Projections

Projected
Growth %

Year

Assets Rs inBn

Branches

Human
Resource[Avg.
Head Count 15/
branch]

20

2012

712

1,000

15,000

20

2013

855

1,772

18,000

20

2014

1,026

1,440

21,600

20

2015

1,231

1,728

25,920

20

2016

1,477

2,074

31,104

20

2017

1,772

2,488

37,325

Staff level distribution as per international standards*


Additional Staff Required by 2017
Senior Manager

1%

220

Mid-level managers

15%

3300

Front line Field staff

84%

18480

SITUATIONS VACANT IN ISLAMIC FINANCE


Relationship/Branch
Managers

Front office professional, General banking & relationship management skills along with
thorough shariah product knowledge.

Islamic Corporate/
Investment Bankers

Front office personnels, Corporate lending, credit risk & shariah facility structuring.

Shariah Product
Development

42

Islamic Business & Finance | ISSUE 78

Specialist function with sound knowledge of Islamic commercial law, product


development and banking operations.

Shariah Compliance
Auditor/ Officer

Exclusive Islamic Banking requiring Shariah Product and processflow knowledge for
shariah governance and control.

Risk Managers

Risk management knowledge for market, credit and operational risk in addition to
shariah related facility risk and shariah compliance.

Trade Finance
Manager

Trade finance , International Codes, UCP along with shariah modalities and transaction
process flows requirements.

Operations Manager

General banking operation knowledge with knowledge of shariah accounting treatments


and flows

HELP NEEDED

Candidates need to be well-versed


in conventional banking practices as
well as Islamic banking and must be
able to understand and communicate
the difference between the two. Given
that there is a religious background
to Islamic banking there exists a need
to understand the basic principles
of Islam in relation to financial
transactions. The requirement
for better-qualified personnel has
increased particularly in Product
Development, Risk Management,
and Shariah compliance.

22000

Treasury Manager

Treasury, FX, Market Risk, Asset Liability Management with shariah compliant
invesments & liquidity management expertise.

Islamic Equity &


Mutual Fund Manager

Portfolio management, asset risk profiling, fixed and equity markets along shariah
screening and compliant investments.

Takaful Manager

Acturial underwriting, risk profiling, premium and portfolio management along with
shariah contractual arrangement and shariah investments.

Shariah Advisor

The centripetal body holding the riegns of shariah governance, control and compl.
Authority and Subject matter expert on Shariah, Fiqa, Islamic Commercial Law

www.cpifinancial.net

EDUCATION

Islamic banks personnel must be


proficient in conventional banking
operations and product structuring
and they should be able to explain
to customers the differences between
Islamic and conventional product
structures. Consequently, the demand
for Islamic banking and finance
education and training has increased
and the number of institutions
providing higher education and
training for Islamic banking and
finance is also increasing.

Candidates need
to be well-versed
in conventional
banking practices
as well as Islamic
banking and
must be able to
understand and
communicate
the difference
between the two
THE REAL CHALLENGE

The human resources produced by


conventional academic programmes
cannot meet the demands and skills
set of the Islamic financial institutions,
which require highly-competent and
motivated candidates with required
knowledge of conventional banking
as well as knowledge of Islamic

economic principles.
Being a nascent industry with 11
years of history, existing conventional
finance professionals need to be
trained to shrink the shortage of
experienced professionals.
The
shortage
of
skilled
professionals is graded as the one of
the key impediments to the growth
of the Islamic finance industry locally
in Pakistan, where Islamic finance
has an eight per cent penetration
rate, as well as globally, which
can only be addressed by higher
education institutes.

CAREER OPPORTUNITIES

In the terse words of the Governor of


Bank Negara Malaysia Dr. Zeti Akhtar
Aziz, Islamic banking and finance is a
mirror of the sea for until and unless
we have the courage to explore its depth,
we would never be able to uncover the
treasures that reside within.
Apposite education is the key
enabler towards the exploration
of the treasures of this sea. State
Bank of Pakistan- NIBAF Program,
International Islamic University
Islamabad, Daar-ul-Uloom Karachi,
MBA in Islamic Finance Muhammad
Ali Jinnah University, ShaikhZayed
Institute University of Karachi
are a few big names engaged in
Islamic finance programmes. But,
its adequacy to meet the estimated
demand of over 20,000 personnel in
the upcoming five years remains a
moot point. Moreover, accreditation
and recognition of these programmes

from bodies like AAOIFI, INCIEF,


ISRA, IFSB etc. also call for more
focused efforts.

WORLD OF POSSIBILITIES

Being a specialty domain, there are


good prospects for skilled youths to
export their expertise to GCC and
MENA countries, Malaysia, Oman
and even to emerging western
markets like Australia.
India, one of the biggest exporters
of human resources to the GCC, doesnt
have a local Islamic finance industry
and thus leaves Pakistan the sole
regional provider of human resource,
making competition irrelevant.
Islamic finance qualifications and
academic programmes also attract
Islamic studies and Fiqh students to
mainstream employment opportunities
by training them on modern Islamic
banking and finance skills.
A career in Islamic finance covers
a variety of human resource profiles
and backgrounds to serve functions like
Shariah compliance auditor, product
development, Shariah advisors, fund
managers, operations manager, Islamic
treasurers, business managers and
Takaful portfolio managers.
Currently, there is a skill-toemployment gap prevailing in the
Islamic banking and finance industry
in Pakistan. Higher education
providers must also come up with
standardised and internationally
accredited programmes and initiatives
to serve the emerging demands of the
global Islamic finance industry.

Muhammad ArsalanAqeeq is an experienced Islamic banker from Pakistan. He

holds a Diploma in Islamic Finance from CIMA and has experience in corporate lending,
syndication finance, project finance, credit risk review, cash flow analysis, financial
modelling and credit origination functions for conventional and Islamic banking
institutions. He is an independent corporate trainer and research supervisor in premier
academic organisations like the Institute of Bankers Pakistan, Karachi Institute of
Economics and Technology and the Shaheed Zulfiqar Ali Bhutto Institute of Science and
Technology. He may be contacted at: arswasti@yahoo.com

www.cpifinancial.net

ISSUE 78 | Islamic Business & Finance

43

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