Syed Qasim Ghani Course: Banking & Takaful

SAP ID: 19785 Class: M.COM-A

Islamic Banking - Profit Calculation on Deposits

Home Assignment

Following is the Deposit situation at Islah Islamic Bank.

Deposit (TENOR) Deposit Days with Bank Daily Balance Monthly Av. Balance
(Months) (Rs.) (Rs.) (Rs.)
3 60,000 10 600,000 19,355
3 1,500,000 20 30,000,000 967,742
Month wise Total 30,600,000 987,097
Month wise Daily Av. Balance
(Months) (Rs.) (Rs.) (Rs.)
6 400,000 15 6,000,000 193,548
6 350,000 14 4,900,000 158,065
Month wise Total 10,900,000 351,613
Month wise Daily Av. Balance
(Months) (Rs.) (Rs.) (Rs.)
12 2,500,000 10 25,000,000 806,452
12 500,000 12 6,000,000 193,548
Month wise Total 31,000,000 1,000,000
Month wise Daily Av. Balance 72,500,000 2,338,710

Following is the additional information

Total size of the Asset Pool = 64,193,548
Total Income = 753,973
Bank's (mudarib) Share = 150,795
Days in Month = 31

Mudarabah Sharing Ratio = 20%

Weightage of the Equity = 1

You are required to calculate the Income allocation along with annualized rate of return

to each type of deposit.

Income Allocation
Tenor Av. Deposit Weightage Wted. Av % (per anum)
(Rs.)
E= 603../63623*592,258
A B C D= (B*C) F=E/B*100*365/31
(for first row-3 months)

3 987,096.77 0.60 592,258.06 5,614.86 6.70

6 351,612.90 0.70 246,129.03 2,333.41 7.81
12 2,338,709.68 1.00 2,338,709.68 22,171.97 11.16
Eq 60,516,128.65 60,446,451.23 573,058.17 11.15
Total 64,193,548.00 63,623,548.00 603,178.40