The future of conventional and Islamic financial products in Libya

Author: | Published: 1 Mar 2012

Following the popular uprising in Libya of 2011, it is still premature for the relevant regulators to consider the overhaul of the financial services industry in Libya, including Islamic finance, the regulation of foreign banks and stock exchange.

The current Banking Law No 1 for 2005 and the Stock Exchange Law No 11 for 2010 are still in force and shall regulate all banking and securities activities at present until being amended. It is therefore too early to comment on the proposed regulation of Islamic financial services, foreign licenses or specific banking models.

As Libya makes the transition to a new government, Libyan banks have limited the amount of cash that any individual or entity may withdraw from the market. This has led the Libyan Stock Exchange (LSE) to suspend its operations due to cash problems within local banks, plus the need to connect fiber optics between Tripoli and Benghazi.