On October 7, 2010, the task force created the International Islamic Liquidity Management Corporation (IILM). Fully operational since the beginning of 2011, this organization is supported by 12 central banks and its mission is to issue short-term sukuk (fixed-income certificates compliant with the ethical investment guidelines of Islam) in global reserve currencies. IILM’s first issuance is expected by year-end 2011.
On 12 October, 2011 the task force issued an Exposure Draft presenting their proposed principles on liquidity risk management. The 22 guiding principles include specifying the roles and responsibilities of the board of directors and senior management, addressing funding diversification, contingent funding plans and the issuance of Shari’ah-compliant liquidity instruments. A set of principles is also laid out for national regulators, inviting them to actively monitor liquidity at a systemic level and to supervise directly how IFIs are managing their liquidity. <link to report> As a global standard setter for IFIs, the IFSB principles are often adopted by the relevant supervisory authorities, even though the IFSB has no legislative power.