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CHAPTER 1
General Overview of Banking

System In Malaysia
Prepared By: Dr. Nor Hafizah binti Hasan

Introduction
• An overview of modern financial
management of banking, non-bank
financial intermediaries and financial
markets.
• The development of banking and
financial institutions in Malaysia.
Introduction
• Malaysia has a unique legislative framework
consisting of mixed jurisdictions and mixed legal
systems namely the common law and shariah.
• The growth and development of banking industry
are supported through goods governance and its
comprehensive legal frameworks.
Financial
System
Non-Bank
Banking Financial Financial
System Intermediaries Markets
Financial
System
Banking Capital Market Insurance
Private/Public Money
Conventional Conventionatial
Debt Securities Market
Islamic Stock Exchange Derivative Islamic

Banking System
• Monetary Institutions- Central Bank,
Monetary authority, Commercial Banks.
• Non-monetary Institutions- Finance Co,
Merchant Banks and Discount Houses.
Non Bank Financial Intermediaries
• Development Financial Institutions- Bank
Pembangunan, BKR
• Saving Institution- National Saving Banks and
Credit Cooperative
• Provident and Pension Fund-EPF, Pension Trust
Funds, LTAT.
• Insurance Companies- Conventional and Islamic
• Other Financial Intermediaries- MBSB, Leasing
Co. LTH.
Financial Markets
• Money and Foreign Exchange- Market for
securities less than 12 months to maturity.
Eg- banker’s acceptance, negotiable
instruments.
• Capital Market- Primary and secondary
securities market. SC.
• Commodity Futures market and financial
futures market and options market-
COMMEX, MDEX.
BAFIA
Deposit Taking Scheduled Institution Non-Scheduled

Institutions Institution
The Development of BFI
• Phase 1: 1840-1900: 7 Western banks were established.
– The Oriental Bank was set up in Singapore in 1846
– The Mercantile Bank of India, London and China in
1855,
– The Chartered Bank of India,, Australia and China in
1859
– The Asiatic Banking Corporation and the Commercial
Bank of India both in the 1960's,
– Rhe Nederlandse Handel Matschappij (N. H. M. ) in
1883.
– The Hong Kong and Shanghai Banking Corporation
in 1884.
• Post 1900: Gradual emergence of local Chinese banks.
• The first local Chinese bank,, Kwong Yik Bank, was founded in
Singapore in 1903.
• Kwong Yik (Selangor) Banking Corporation in 1913. The first bank
incorporated in KL.
• Sze Hai Tong in 1906.
• Chinese Commercial Bank in 1912
• Ho Hong Bank in 1917
• Overseas-Chinese Bank in 1919.
• Lee Wah Bank, Bank of Malaya and Batu Pahat Bank in 1920
• Ban Hin Lee Bank in 1935
• United Overseas Bank in 1935.
• Malay bank was established in 1947 but it failed in 1952.
• Bank of Canton in 1953,
• Bank of America in 1955,
• Bank of Indonesia in 1955,
• Bank of Tokyo and Bangkok Bank in 1957
• Post 1957
• Maybank Berhad and UMBC in 1960.
• BBMB in 1966.
• 1983 BIMB: Islamic Banking
• 1993: BBMB, UMBC and Maybank to open
Islamic Banking window : SPTF
• 2004 - Foreign Islamic full-fledged banking
license to Kuwait Finance House (KFH), Al-
Rajhi Investment Bank, Saudi Arabia and
Qatar Investment Group.
• 2011: 24 CB and 17 IB.
BNM
• The idea had been first seriously mooted in the
International Bank for Reconstruction
Development Mission Report on the Economic
Development of Malaya in 1955.
• The Central Bank of Malaya Ordinance 1958
(replaced by the CBA 2009) and the Banking
Ordinance 1958 (replaced by the BAFIA
1989)
BNM
• 2 Objectives:
• 1) To promote monetary stability and a sound financial
structure
• 2) To influence the credit situation to the advantage of
the federation
• The BNM is therefore charge with the task of
implementing all the regulations concerned with these
matters as laid by the law, as well as issuing policies
and directives to further the implementation of these
regulations.
• Where and when certain of the regulations have become
inadequate or new or additional regulations become
necessary, it is also the Central Bank's responsibility to
initiate the formulation of such changes.
BNM
• (a) to issue currency in the Federation and to keep
reserves safeguarding the value of the currency
• (b) to act as banker and financial adviser to the
government
• (c) to promote monetary stability and a sound
financial structure
– SRR: S 36 BAFIA
• (d) to influence the credit situation to the
advantage of the Federation
banking business
• “banking business” means—(a)the business
of—(i)receiving deposits on current
account, deposit account, savings account
or other similar account;(ii)paying or
collecting cheques drawn by or paid in by
customers; and(iii)provision of finance;
or(b)such other business as the Bank, with
the approval of the Minister, may prescribe;
Commercial Banks
• 24 Commercial Banks in Malaysia
• Largest and most important
• Provides current account facilities where
payments can be effected readily through
the issue of cheques.
Islamic Banks
• 17 Islamic Banks: Islamic Banking Act
1983
• banking business whose aims and
operations do not involve any element
which is not approved by the Religion of
Islam;
Development Finance Companies
• the business of providing capital or other
credit facility on terms which would require
the same to be utilised for industrial,
agricultural, commercial or other economic
development; and for the purposes of this
definition, “development” includes the
commencement of any new industrial,
agricultural, commercial or other economic
venture or the expansion or improvement of
any such existing venture.
Discount House
• Receiving deposits on deposit account;
• the investment of such deposits and other
funds of the institution in Malaysian
Government securities, Treasury bills or
such other investments as may be
prescribed by the Bank;
Finance Companies
• the business of receiving deposits on
deposit account, savings account or other
similar account; and
• giving of credit facilities, leasing business,
• business of hire-purchase, including that
which is subject to the Hire-Purchase Act
1967
Merchant Banks
• provision of finance (leasing business, lending, purchase of negotiable
instruments, guarantee of any liability).
• providing consultancy and advisory services relating to corporate and
investment matters
• making or managing investments on behalf of any person;
• merchant banks are basically specialised wholesale banking institutions
looking after the affairs, in the majority of cases, of corporate clients
rather than individuals.
• merchant banks cannot accept demand deposits or extend overdraft
facilities.
• corporate finance and advisory services: services as underwriters for
share issues and acting as share registrars ; providing advice on capital
restructuring,, mergers and acquisitions ; promotion of new investment
and joint ventures; and the undertaking of feasibility studies.
• Investment advice, which includes portfolio management and the
establishment and management of investment and unit trusts.
• Banking intermediation services: the management of syndicated loans
and the provision of acceptances and guarantees.
Investment Bank
• 15 investment banks in Malaysia
• raise funds for businesses and some governments by
registering and issuing debt or equity and selling it on a
market.
• A financial intermediary that performs a variety of
investment services, including underwriting, acting as an
intermediary between an issuer of securities and the
investing public, facilitating mergers and other corporate
reorganizations and also acting as a broker for
institutional clients.
• doesn't usually provide retail banking services
• investment bank's clients are institutional investors and
high net-worth individuals
Tutorial
• Presentation to brief Islamic Banks’
Profile.
• Name, Logo, Board of Directors, Capital,
Products, Address and further
particulars.
• Each group is allocated 15 minutes.
CHAPTER
2&3
Concepts And Theories Of
Islamic Finance
Sub-topics
• Introduction
• The Objectives of Islamic Finance
• The economic & philosophical of Islam for
banking
• The principles of Islamic banking operation
• Conclusion
Objectives
• To discuss the relationship between Islamic
Financial System with Islam and Syari’ah.
• To explain the objectives of Islamic banking
system.
• To elaborate upon the Islamic Laws and principles
which have been applied in Islamic Banking
system.
• To differentiate the laws and principles concerned,
either in their concepts or their applications.
The Economic & Philosophical Principles of
Islam for Banking
• Two key elements to the economic philosophy of
Islam
1. Allah SWT is the creator of everything on earth and
in the heavens. Human beings are only trustees who
should utilize these resources in an efficient way to
fulfill Allah’s will for establishing prosperity on earth
for the good of all mankind.
2. A Muslim entrepreneur is considered only a ‘vice-
regent’ on earth. Man’s right to ownership is obtained
by proxy from Allah, and as Allah made man ‘his
‘vice-regent’, man must function according to his
teachings and in the end be accountable to Allah for all
deeds, be they good or bad.
Islam, Shari’ah and Islamic Finance,
• Shari’ah literally means ‘way to water’ – the source of all life – and
signifies the way to God, as given by God.
• Shari’ah is the code of law derived from the Koran and from the
teachings and example of Prophet Mohammed (Pbuh) i.e. sunnah.
• Shari’ah has its correlation with the words ‘din’ and ‘millah’.
Shari’ah covers the total way of life that includes faith and practices,
personal behaviours, as well as legal and social transactions.
• The name of this Shari’ah is Islam.
• Shari’ah can be divided into three main branches (i.e aqidah, fiqh and
akhlaq).
• Aqidah means an absolute belief in a person’s heart in Allah s.w.t. and
His last prophet, Muhammad peace be upon him (p.b.u.h).
• Fiqh concerns all aspects of all forms of practical actions by a
Muslim.
• Akhlaq covers all aspects of Muslim behaviour, attitude and work
ethics with which he performs his practical actions. It consists of
‘man to man’ and ‘man to Allah s.w.t.’ relationships.
• The Islamic jurisprudence is called fiqh.
• Islamic jurisprudence, Fiqh (‫ )فقه‬in Arabic, is a science of
practicles rules which derived from specific evidence from al-
Quran and al-sunnah.
• There are four Sunni schools or mazhab of fiqh.
• Fiqh is divided into two parts: the study of the sources and
methodology (usul al-fiqh - roots of the law) and the practical
rules (furu' al-fiqh - branches of the law).
• Later on, the word Shari’ah or Shari’ah law is used generally
to describe the Islamic jurisprudence or fiqh.
• Fiqh (i.e.Islamic jurisprudence or Shari’ah law) comprise two
types of relationships.
i. Ibadat i.e relationship with god. Ibadat is concerned with the
practicalities of a Muslim’s worship of Allah.
ii. Muamalat i.e. relationship with human being. Muamalat is
concerned with the man to man relationship.
Five categories of Ahkam (Rules) in
Shari’ah Law.
• Wajib (Obligatory): The terms wajib conveys an
imperative and binding demand addressed to the
mukallaf in respect of doing something. Action upon
something wajib leads to reward, while omitting it leads
to punishment in this world and in the hereafter.
• Sunnah/ masnun/ mandub/ mustahab(recommended):
Mandub denotes a demand to perform deeds which is,
however, not binding on a mukallaf. To comply with the
demand earns the mukallaf spiritual reward, but no
punishment is inflicted for failure to perform.
• Mubah/ jaiz (permissible): Mubah is where the
Lawgiver has granted a choice of omission or
commission, without blame or praise for either.
• Haram (prohibited): Haram is the omission
required in binding and certain terms. Committing
a haram deed is punishable, and omitting a haram
deed is rewarded. For example, riba’ is prohibited
to every Muslim.
• Makruh (reprehensible): Makruh is a demand
which requires the mukallaf to avoid something,
but not in strictly prohibited terms. Committing in
makruh deeds is not punishable, although omitting
it is rewarded.
ISLAMIC FINANCE, ISLAM AND SHARI’AH
ISLAM
AQIDAH SHARIAH AKHLAK
IBADAH MUAMALAT
Political activities Economic activities Social activities
Banking and financial activities
The relationship between Islamic financial system with Islam and Syariah
The Objectives of Islamic Finance
• To put before to all Muslims, contemporary Islamic
financial dealings in strict respect of the ethical individual
and social values of Islamic Shari’ah, without contravening
the heavenly imposed prohibition of dealing in riba (interest
or usury).
• To serve all Muslim communities in mobilising and utilising
the financial resources needed for their true economic
development and prosperity within the principles of Islamic
justice assuring the right and obligations of both the
individual and the community.
• The serve the ‘ummat al-Islam’ (Islamic communities) and
other nations by strengthening the fraternal bonds through
mutually beneficial financial relationships for economic
development and the enhanced environment for peace.
Principles of Shari’ah in Islamic Finance
• Muslim jurists suggested a numbers of shari’ah principles which can be
classified into four categories:
i. Profit and loss sharing principles
a. mudarabah
b. musyarakah
ii. Trade-based based principles
a. Murabahah
b. Bay al-Muajjal/ bay bithaman ajil
c. Ijarah
iii. Fee-based principles
a. al-ujr
b. al-Wakalah
. iii. Free service principle (Qard hasan)
a. Qardh
b. Wadiah
c. Rahn
Contracts in Islamic Law
Contracts in Islam ic Law
Contracts of Exchange Charitable contracts
W akalah Q ard hasan

Trust contracts Bargaining contracts
Hiwalah hibah
W adhiah Tauliah bay' ijarah
sadaqah kafalah
M urabahah salam istisna'
Rahn W adiah
sarf wakalah
syarikah M udarabah
Inan M ufawadah Abdan W ujuh

Range of Islamic Banking Products and Services
in Malaysia
1. Deposits
2. Retail Financing
3. Trade Financing
4. Money Market
5. Card Services
6. Bank Services
Sources : BNM Website
December 4, 2023 WB3053 37

DEPOSIT
Products / Services Applicable Concepts
Savings account-i Wadiah / Mudharabah
Current account-i Wadiah / Mudharabah
General investment account-i Mudharabah
Special investment account-i Mudharabah
December 4, 2023 WB3053 38

1. DEPOSIT
a. Saving Account:
– al-Wadiah
– Hibah
– al-Mudharabah
December 4, 2023 WB3053 39

Contoh Produk di AmBank
• Savings Accounts
– Al-Wadiah Savings Account
– Al-Wadiah Savers' G.a.n.g
December 4, 2023 WB3053 40

b. Current Account:
– al-Wadiah
– al-Qardul Hasan
– Hibah
– Al-Mudharabah
December 4, 2023 WB3053 41

Al-Wadiah Current Account
– You can be certain that your money will be in good

hands when you open an Al-Wadiah Current Account
with us. Should you want to withdraw your deposit,
we will return the entire amount or the balance any
time.
December 4, 2023 WB3053 42

c. Investment Accounts
– Al-Mudharabah General Investment Account

– (GIA)
Am50Plus GIA (Senior Citizen's Account)
– Al-Mudharabah Special Investment Account
– (SIA) Afdhal Investment Account Al-
– Mudharabah GIA QUANTUM
December 4, 2023 WB3053 43

Al-Mudharabah Special Investment Account
• Concept
• Al-Mudharabah
• Profit-sharing
• Refers to an agreement made between a party, who provides
the capital and another party (entrepreneur), to enable the
entrepreneur to carry out business projects, which will be on a
profit sharing basis, according to a pre-determined ratios
agreed upon earlier.
December 4, 2023 WB3053 44

FINANCING
• After meeting the statutory reserve requirement
and holding the required level of liquid assets, the
bank is free to apply the remainder of the
customer’s deposits and the shareholder’s fund for
banking operations.
• Under this heading, we shall touch on some types
of the bank’s financing facilities.
December 4, 2023 WB3053 45

RETAIL FINANCING
Cash line facility-i Bai' Bithaman Ajil / Murabahah
Computer financing-i Bai' al-Inah / Murabahah
Education financing-i Bai' Bithaman Ajil / Bai' al-Inah
Hire purchase-i Al-Ijarah Thumma al Bai'
Home / House financing-i Bai' Bithaman Ajil
Land financing-i Bai' Bithaman Ajil
Leasing-i Ijarah
December 4, 2023 WB3053 46

RETAIL FINANCING CONT..
Pawn broking-i Ar-Rahnu
Bai' Bithaman Ajil / Bai' al-Inah /

Personal financing-i
Murabahah
Plant & machinery financing-i Al-Ijarah Thumma al-Bai'
Project financing-i Bai' Bithaman Ajil
Property financing-i Bai' Bithaman Ajil
December 4, 2023 WB3053 47

RETAIL FINANCING CONT..
Bai' Bithaman Ajil / Mudharabah /

Share financing facility-i
Musyarakah
Shop house financing-i Bai' Bithaman Ajil
Sundry financing-i Bai' Bithaman Ajil
Umrah & visitation financing-i Bai' Bithaman Ajil
Bai' Bithaman Ajil / Mudharabah /

Unit trust financing-i
Musyarakah
Working capital financing-i Murabahah
December 4, 2023 WB3053 48

CASH LINE FACILITY
• MCASH is a facility based on the contract of Al-Bai’
Bithaman Ajil or Bai’ Al-Inah.
• Under BBA contract, the Bank purchases customers’
fixed assets at a cost price and the proceed shall be
utilised for the purpose of working capital
requirements. The Bank subsequently sells back that
asset to the customer at a selling price (cost plus
profit) on deferred terms.
• Under Bai’ Al-Inah contract, asset for the purpose of
aqad may originate from the customer or the Bank.
December 4, 2023 WB3053 49

FEATURES
• Tenor, selling price and terms of the deferred payment must be
agreed upon by the Bank and the customer.
• The BBA purchase price shall be disbursed as a limit to the
designated Current Account.
• The BBA profit shall be serviced monthly whilst principal is
settled in one lump sum at the end of the tenor or in other
manner acceptable to the Bank.
• Ibra’ (Rebate) shall be granted for the unutilised financing
amount at the Bank’s discretion.
• MCASH may be renewed via executing new BBA/Bai’ Al-Inah
contract prior to expiry.
December 4, 2023 WB3053 50

EDUCATION FINANCING
• This financing scheme is to be governed under
the Bai’ Al-Inah contract.
• Under this contract, the Bank will sell an asset
to the customer at a selling price comprising
of the financing amount plus profit margin on
deferred terms.
• The Bank will subsequently purchase back the
asset from the customer on cash basis which is
equivalent to the required financing amount.
December 4, 2023 WB3053 51

BBA HOME FINANCING
• This financing is based on the Al-Bai
Bithaman Ajil (BBA) contract.
• BBA refers to a sale with a deferred payment
customer.
• Under this contract, the Bank will purchase
the required asset at a cost price and resell it to
the customer at a profit margin (cost plus
profit) on deferred payment basis at the
duration and price agreed by booth parties
repayable by fixed instalments.
December 4, 2023 WB3053 52

• FEATURES
• The selling price shall be agreed upon by both parties i.e.
customer and the Bank and will remain unchanged until
the end of the repayment period.
• Periodical (monthly/quarterly/half year) installments are
determined by the selling price and the repayment period.
• The property ownership purchased will be under the
Bank's claim and will be handed over to the customer
upon full payment.
• The selling price will remain unchanged even though
there is a change in duration and market price.
December 4, 2023 WB3053 53

SHARE FINANCING FACILITY
1. Project Financing (Al-Mudharabah/ Trustee
profit-Sharing)
2. Project Financing ( Al-Musharakah/ joint
Venture-Profit sharing)
3. Financing The Acquisition of Assets. ( Al- Bai
Bithaman Ajil/ Deferred Instalment sale)
December 4, 2023 WB3053 54

• Project Financing (Al-Mudharabah/
Trustee profit-Sharing)
– The bank may undertake to finance
acceptable project under the principle of Al-
Mudhabah.
– In this instance the bank is the ‘provider of
capital’ and will provide 100 percent
financing for the relevant project.
December 4, 2023 WB3053 55

• Project Financing ( Al-Musharakah/ joint
Venture-Profit sharing)
– The bank may undertake to finance
acceptable project under the principle of Al-
Musharakah.
– In this instance the bank together with the
initiators of the relevant project will provide
for the project in agreed proportions.
December 4, 2023 WB3053 56

• Financing The Acquisition of Assets. ( Al-
Bai Bithaman Ajil/ Deferred Instalment
sale)
– The bank may financing the customers who
wish to acquire a given assets but to defer the
payment for the asset for specific period or to
pay by installments under the principle of Al-
Bai Bithaman Ajil.
December 4, 2023 WB3053 57

TRADE FINANCING
• The bank provides specific facilities and financing
mostly on short-term basis for the purpose of
facilitating trade or working capital requirement
for its customers.
• These facilities may be granted in connection with
the purchase/import and sales/export of goods and
machineries, and the acquisition and holding of
stock and inventories, spares and replacements,
raw materials and semi-finished goods
December 4, 2023 WB3053 58

TRADE FINANCE
Accepted bills-i Murabahah
Bank guarantee-i Kafalah
Export credit refinancing-i Murabahah

Wakalah / Murabahah /
Letter of credit-i
Musyarakah
Shipping guarantee-i Kafalah
Trust receipt-i Murabahah
December 4, 2023 WB3053 59

LETTER OF CREDIT
• Three types :
1. Letter of Credit (Al-Wakalah/ Agency)
2. Letter of Credit (Al-Musharakah/ Joint-
Venture Profit Sharing)
3. Letter of Credit
(Al-Murabahah/Deferred Lump-Sum
Sale or Cost Plus)
December 4, 2023 WB3053 60

Letter of Credit (Al-Wakalah/ Agency)
• The bank established the Letter Of Credit and
pays the proceeds to negotiating bank utilizing
the customer’s deposit; and subsequently release
the document to the customers.
• The bank charges the customers fees and
commission for its services under the principle of
Al-Ujr (Fee).
December 4, 2023 WB3053 61

Letter of Credit (Al-Musharakah/ Joint-
Venture Profit Sharing)
the customer’s deposit as well as its own shares
of financing, and subsequently releases the
document to the customers.
• The bank and the customers share in the profit
from the venture as provided for in the
agreement.
December 4, 2023 WB3053 62

Letter of Credit (Al-Murabahah/Deferred Lump-
Sum Sale or Cost Plus)
its own funds.
• The bank sells the goods to the customer at a
sale price comprising its cost and a profit
margin under the principle of Al-Murabahah for
settlement on a deferred term.
December 4, 2023 WB3053 63

LETTER OF GUARANTEE
• Bank may provide the facility of a letter of guarantee for
certain purpose under the contract of Kafalah.
• Provide in respect of the performance of task, The
settlement of a loan, Etc.
• The following are the types of guarantee given by Bank:
– Tender Guarantee.
– Project Performance Guarantee.
– Guarantees for the refund of advance payment and progressive
payments.
– Retention money guarantee.
– Customs guarantees relating to the import of goods without
payment of duty.
December 4, 2023 WB3053 64

Eligibility
• Customer has to place a certain amount of
deposits for this facility, which the Bank
accepts under the contract of Wadiah.
Processing Fee
• Customers have to pay a fee for the services
it provides.
December 4, 2023 WB3053 65

MONEY MARKET
Bank Negara negotiable notes-i Bai' al-Inah
Commercial papers-i Murabahah
Government investment issues-i Bai' al-Inah
Negotiable debt certificate-i Bai' Bithaman Ajil
Negotiable instument of deposit-i Mudharabah
December 4, 2023 WB3053 66

Negotiable Islamic Debt Certificate (NIDC)
• NIDC is based on Al-Bai Bithaman Ajil (Deferred
payment sale) and Al-Bai Al-Dayn (Debt trading).
• Investor purchases asset from the Bank on cash basis.
• Investor re-sells this asset to the Bank at a higher price
on credit basis.
• Bank issues NIDC to the investor.
• Bank settles this credit to the investor upon an agreed
future date.
• NIDC can be traded in the secondary market subject to
guidelines for Islamic Negotiable Instruments issued by
Bank Negara Malaysia.
December 4, 2023 WB3053 67

CARD SERVICES
Charge card-i Qardul Hasan
Credit card-i Bai' al-Inah
December 4, 2023 WB3053 68

CREDIT CARD
• Bank Islam Card (BIC) is the first credit card, which is purely
based on Shariah contract, to be offered to Muslim and non-
Muslim.
• BIC is completely free from any riba or gharar.
• Riba is usually translated as "interest" which means an extra
amount charged in transactions dealing with silver, gold or
money. Gharar is defined as uncertainty or ambiguity, which has
been removed from BIC since the maximum profit earned has
been declared upfront.
• 3 main Shariah contracts being used:
• Bai Inah
• Wadiah
• Qardhul Hassan
December 4, 2023 WB3053 69

CREDIT CARD
• Bai Inah comprises of two agreements (akad).
– the bank sells a piece of land to the customer at an
agreed price.
– the Bank re-purchases the land from the customer at
a lower price.
– The difference in the price is therefore the Bank's
maximum profit, which is determined in advance,
unlike the conventional credit card whereby the
interest charged is undetermined and it may further
increase.
December 4, 2023 WB3053 70

CREDIT CARD
• The Bank will then disburse the cash proceeds of the
second agreement into the customer's Wadiah BIC
account created and maintained by the bank.
• Then after, the customer can use his BIC for retail
purchases and cash withdrawals just like a conventional
credit card, except that each transaction will be backed
by the cash held in his Wadiah BIC account.
• Qardhul Hassan is a facility by which the Bank may, at
its own discretion, allow the customer to use more than
the available balance in his Wadiah BIC account.
December 4, 2023 WB3053 71

BANK SERVICES
Products/Services Applicable Concepts
Stock broking services Ujr
TT / Funds Transfer Ujr
Travellers' Cheques Ujr
Demand Draft Ujr
Cashiers' Order Ujr
Standing Instruction Ujr
ATM Service Ujr
Telebanking Ujr
December 4, 2023 WB3053 72

PRODUCTS AND SERVICES OF SELECTED BANKS
BIMB B.MUAMALAT MAYBANK
PERBANKAN ELEKTRONIK ELECTRONIC BANKING
 Perbankan Internet PRODUCTS
 Kad Smart  ATM
 Perbankan Desktop  Autopay
 Kemudahan Rangkaian MEPS  Direct Debit
 Sistem Pembayaran GIRO  Muamalat OnLine
Antara-Bank MEPS
 Pusat Perbankan Elektronik
DEPOSIT DEPOSIT PRODUCTS DEPOSIT PRODUCTS

 Akaun Semasa  Al-Wadi’ah Savings Account-i  Premier Mudharabah
 Akaun Simpanan Wadiah  Al-Wadi’ah Current Account-i Account-i

 Akaun Simpanan  Al-Mudharabah General  Wadiah Accounts
Mudharabah Investment Account-i  Mudharabah Investment
 Akaun Simpanan Wadi  Al-Mudharabah Special Accounts

 Akaun Simpanan Ijraa Investment Account-i
 Akaun Simpanan Pewani
 Akaun Pelaburan
 Akaun Pelaburan Sakinah
 Sijil Hutang Islam Boleh
Niaga
PEMBIAYAAN TRADE FINANCING TRADE FINANCE
PERDAGANGAN  Al-Murabahah Working Capital PRODUCTS
 Surat Kredit DI Bawah Financing  Wakalah Bills for
Prinsip Al-Wakalah  Bai’ Al-Dayn Working Capital Collection-i

 Surat Kredit DI Bawah Financing  Murabahah/Wakalah
Prinsip Al-Musyarakah  Islamic Letter of Credit Letter of credit-i

 Surat Kredit DI Bawah  Islamic Accepted Bill  Murabahah Trust
Prinsip Al-Murabahah  Islamic Export Credit Receipt-i

 Surat Jaminan  Bills Exchange
Refinancing
 Pembiayaan Modal Pusingan  Islamic Foreign/Domestic Bill of Purchased-i
Di Bawah Al-Murabahah Exchange Purchased  Bank Guarantee-i
 Pensekuritian Dan Bil (Documentary)  Shipping Guarantee-i
Penerimaan Islam (IAB-  Islamic Foreign/Domestic Bill of  Islamic Accepted Bil-il

Import) Exchange Purchased (Authority  Islamic Export Credit
 Pensekuritian Dan to Purchase) Refinancing-I
Pembiayaan (IAB-Eksport)  Al-Kafalah Shipping Guarantee
 Skim Pembiayaan Semula  Al-Kafalah Letter of Guarantee
Kredit Eksport (IECR)  Islamic Foreign/Domestic
 Maklumat Pembiayaan
Inward Bill for Collection
Perdagangan  Islamic Foreign/Domestic
Outward Bill for Collection

PEMBIAYAAN PENGGUNA FINANCING PRODUCTS FINANCING PRODUCTS
 Pembiayaan Rumah Baiti  BBA Home Financing  BBA Home Financing-i
 Pembiayaan Pendidikan  Istisna’ Home Financing  Tamwil Cash Line Facility-i
 Pembiayaan Kedai & Rumah  BBA Fixed Asset  Murabahah Cash Line
Kedai Financing Facility-i

 Pembiayaan Kenderaan  Istisna’ Fixed Asset
 Pembiayaan Peribadi Financing

 Pembiayaan Keahlian Kelab  Cash Line Facility
Golf (MCASH)
 Pembiayaan Tanah  Education Financing
 Kemudahan (Overdraf) Scheme (MEFiS)

 Istisna’ Project Financing
Naqad
 Skim Pembiayaan Ar-Rahnu
 Kad Bank Islam

 Ijarah Financing
 Pembiayaan Umrah &
 Revolving Financing
Pelancongan (MRF)
 Pakej Pembiayaan
PEMBIAYAAN KORPORAT TREASURY PRODUCTS
 Pembiayaan Berkala - Al-Bai  Foreign Exchange
Bithaman Ajil (BBA)  Special Investment

 Pembiayaan Penyambung - Al Account (SIA)/Islamic
Istisnaa Repo
 Pembiayaan Projek - Al-Musyarakah  Investments and Trading
 Pembiayaan Projek Al-Mudharabah in Islamic Securities

 Al-Ijarah Al-Muntahiah Bit Tamlik
 Pembiayaan Bersindiket
 Persekuritian/Pengeluaran Bon
Islam
 Al-Ijarah
 Al-Naqad
 Maklumat Pembiayaan Korporat
 Skim Pembiayaan SME
PERKHIDMATAN LAIN OTHER SERVICES

 Amanah Saham Bank Islam  Safe Deposits Box
 Pembayaran Zakat  Protection
 Kiriman Wang
 BIFCA - Jual-beli Mata Wang Asing
 Jual-beli Cek Kembara
 Penjualan Resit YPEIM

Two categories of the Islamic banking contracts
C ateg ories of con tracts
w h ich ad op ted b y
Islam ic b an k
S tron g ly Islam ic W eakly Islam ic
M u syarakah M u d arab ah B ay' al-In ah K afalah (w ith fee)
B ay' B ay al-S alam H iw alah (w ith fee) m u faw ad ah
Istisn a' S arf
W ad iah Q ard h asan
W akalah H ib ah
Ijarah M u rab ah ah
Conclusion
• The development of philosophies and objectives in
Islamic banking are in line with the principles of
Islamic business as highlighted in the al-Quran and
Sunnah.
• As institutions whose foundations are based on Islamic
doctrines, Islamic banks must conforms to Islamic rules
and regulations.
• Islamic business entities are required to engage
themselves in legitimate and lawful business, and to
fulfill all obligations and responsibilities.
• Islamic bank have to uphold both profit and moral
principles.
Main References
• Saad Abdul Sattar Al-Harran (1993) Islamic
Finance-Partnership Financing. Pelanduk
Publications. Kuala Lumpur.
• Sami Hassan Homoud (1985). Islamic Banking.
Arabian Information. London.
• Sudin Haron and Bala Shanmugam (2001).
Islamic Banking System- Concepts &
Aplication. Pelanduk Publications. Kuala
Lumpur.
• Islamic Finance Bulletin. March 2004. Rating
Agency Malaysia Berhad. Kuala Lumpur.
Where to Get More Information
• http://www.bnm.gov.my/
• http://www.bankislam.com.my/
• http://www.maybank2u.com/
• http://www.channel-e.com.my/
• http://islamic-finance.net/
• http://www.ibfim.com
• http://www.irti.org/
• http://www.alrajhibank.com.sa
• http://www.islamicbankingonline.com
• http://www.ifsb.org
• http://www.bahisl.com.bh
• http://www.albaraka.com.pk/
December 4, 2023 WB3053 80
CHAPTER 4
ISLAMIC BANKING PRODUCT &

SERVICES
Bism il-Lah ir-Rahman ir-Rahim
Introduction
Generally Islam permits trade and commerce
and the contracts that are applied thereto are
termed muamalat in the Shariah. Muamalat are
civil contracts and all civil contracts can be used
in Islamic banking and finance.
Thus in the concept of Islamic banking and

finance the mobilization of deposits is through
contracts permissible by the Shariah and the
application of funds is also through contracts
permissible by the Shariah.
82
Islam
Aqidah Shariah Akhlaq

(Faith and Belief) (Practices and Activities) (Moralities and Ethics)
83
Shariah Requirements
Shariah aspects of Islamic banking and finance

revolve around Shariah requirements which refers
to:
- avoidance of prohibitions, and

- ensuring that the contract have all their
essential elements with their necessary
conditions
84
Shariah Requirements
The prohibitions are:
- Producing and trading of impure materials,

- Producing and trading of materials which are
of no use,
- Gharar,
- Riba and
- Involvement of gambling
85
Gharar
Gharar is divided into two namely:
1 - Gharar yasir, i.e. minor or slight gharar,

and
2 - Gharar fahish, i.e. major or serious gharar
The Gharar that causes a contract to be

invalid is major gharar.
In general terms major gharar is:

- an uncertainty which is so great that it
becomes unacceptable, or
- it is so vague that there is no means of
quantifying it.
86
Gharar
More specifically major gharar arises out of one of
the following:
- Asset or merchandise does not exist;

- Asset or merchandise cannot be delivered; or
- Asset or merchandise is not according to
specifications
87
Riba
Riba means extra and it is of four kinds. Two kinds
are sub-divisions of riba duyun and the other two are
sub-divisions of riba buyu’u.
1. Riba duyun (riba out of lending and borrowing)

This kind of riba is the extra amount of money
over and above the principal of the loan either:
– imposed by the lender upon the borrower in
the contract; or
– promised by the borrower in the contract.
88
Riba
Riba Duyun is sub-divided into:
1.1. Riba qardh i.e. riba is imposed from the
beginning.
1.2. Riba jahiliyah i.e. there is no riba at the
beginning; riba is imposed
only after default.
89
Riba
2. Riba buyu’u (riba in trading transactions).
This kind of riba may occur out of an exchange

between two ribawi materials of the same kind
where the necessary rule(s) are not observed.
There is no riba in trading transactions where a
ribawi material is exchanged with a non-ribawi
material like money with a car; or a non-ribawi
material is exchanged with another non-ribawi
material like rubber with a refrigerator.
90
Riba
Ribawi materials are divided into two basis and under
each basis are the different kinds as follows:
Basis Basis
Medium of Foodstuffs
Exchange
 Gold  Grains 
 Silver  Rice
 Shilling  Wheat
 £  Corn
 Meats
 Beef
 Mutton
 Chicken
 Fishes
91
Riba
(..continued)
Basis Basis
Medium of Exchange Foodstuffs
 USD  Vegetables 
 Singapore Dollar  Tomatoes
 Australian Dollar  Beans
 Hong Kong Dollar
 ¥  Fruits
 Apples
 Oranges
 Salts
 Salt
 Sugar
 Condiments
 Medicines
92
Rules of Exchange of Ribawi Materials
Exchanges Rules
1. Ribawi materials of the same kind of 1. Materials must be of the
the same basis. same weight, measurement
(5 grams of 916 gold for 5 grams or number of units.
of 750 gold; 2. Payment must be on cash
10 grams of Basmathi rice for terms.
10 grams of A1 rice)
2. Ribawi materials of different kinds of 1. Difference in weights,

the same basis. measurements or number
(5 grams of gold for RM200; of units allowed,
RM3,800 for USD1,000; 2. Payment must still be
10 kgs of rice for 15 kgs of wheat; on cash terms.
1 tonne of palm oil for 2 tonnes of
sugar.)
93
Rules of Exchange of Ribawi Materials, cont.
Exchanges Rules
3. Ribawi materials of different kinds of - No rules are imposed.
different bases. (Difference in weights,
(10 kgs of dates for 1 gm of gold; measurements or
30 kgs of wheat for USD10; number of units
1 tonne of palm oil for RM1,500) allowed.)
94
Riba
Riba buyu’u is sub-divided into:
2.1. Riba fadhl i.e. the ribawi

materials (of the same
kind) exchanged are of different
weights, measurements or
numbers and
they are exchanged at the same time.
2.2. Riba nasiah or riba yad i.e. the

ribawi
materials exchanged are of equal weights,
measurements or numbers
but payment of
the price and delivery of
95
the goods are
made at two different
Riba
Islamic banking does not give out loans. Therefore

riba out of lending and borrowing does not arise. To
avoid involvement with riba in trading
transactions, Islamic banking must pay proper
attention to the requirement that the buying and
selling of the following matters must be on cash
terms:
96
Riba
(..continued)
(i) gold in treasury functions for liquidity,

(ii) silver in treasury functions for liquidity, and
(iii) currencies, the currency of each country
being considered as a kind, for hedging
and payments of imports.
97
Gambling
Gambling is betting or charging something that will

be forfeited if one fails to obtain the greater gain
that one hopes for.
Speculation is not gambling. Some jurists say that

speculation is prohibited, but contracts involving
speculation are still valid.
98
Forbidden Contracts
Forbidden and void contracts which involve
gharar, riba and gambling are:
- Bai al-Mulamasah
- Bai al-Munabazah
- Bai al-Hisat
- Bai Habl-il-Hablah
- Bai al-Madhamin
- Bai al-Malaqih
- Bai al-Gharar
- Lending and borrowing with interest
- Betting
99
Islamic Muamalat
After taking out the types of muamalat
(transactions) that are prohibited, those that are
permitted can be divided into three broad
categories as follows:
1. Trading Contracts.
2. Contracts of Profit Sharing.
3. Supporting Contracts.
100
Trading Contracts
Some of the most widely used transactions are;
(A) Cash Sales

(i) Normal cash sales
(ii) Sarf (foreign currency exchanges)
(iii) Exchanges between ribawi materials of
different kinds and of the same
basis (gold with money or wheat with palm oil)
(iv) Bai Al-Dayn (debt trading as in Bills of
Exchange)
101
Trading Contracts
(B) Deferred payment sales (debt financing)
(i) Bai Murabahah (cost plus)

(ii) Bai Tawliyah (novation)
(iii) Bai Wadhiah
(iv) Bai Salam
(v) Bai Istisna’a (sale by order)
(vi) Bai Bithaman Ajil (deferred payment sale)
(vii) Bai Istijrar (supply or whole sale financing)
(viii) Bai Inah
(ix) Ijarah (leasing)
(x) Kiraa’ Waqtinaa’ (leasing then procurement)
102
Contracts of Participation
Contracts of participation (equity financing/ profit
sharing) are:
(i) Musharakah (joint venture profit sharing)

(ii) Mudharabah (trustee profit sharing)
(iii) Muzaraah (leasing of land for agriculture)
(iv) Musaqat (watering of orchard)
103
Supporting Contracts
The Shariah also permits contracts to support and
facilitate trading and mobilisation of capital. These
contracts are:
(i) Rahnu (mortgage)
(ii) Kafalah (guarantee)
(iii) Wakalah (agency)
(iv) Wadiah (safe custody)
(v) Qardh Hasan (benevolent loan)
(vi) Hiwalah (transfer of debt)
(vii) Tabarru’u (donation)
(viii) Hibah (gift)
(ix) Wakf (endowment)
(x) Ibraa’ (rebate)
(xi) Muqasah (set-off)
104
Banking Contracts
- In Islamic banking the following contracts

may be applied in mobilisation of deposits:
(i) Musharakah for shareholders fund
(ii) Mudharabah for customers’ investments
(iii) Wadiah for safe custody and
(iv) Qardh Hasan
- For uses of funds all the contracts of debt

financing and equity financing may be applied.
105
Different Features of Contracts
The different features of Murabahah, Istisna’a, Bai
Bithaman Ajil and Ijarah.
Murabahah
Definition: A sale based on the cost price plus profit.
- The
cost price or profit must be known
to the
buyer.
-
Normal practice price paid in a lump sum.
Istisna’a
Definition: An order made by the buyer for the
106 manufacture of a
merchandise according
Different Features of Contracts, cont.
Bai Bithaman Ajil
Definition: A sale with the payment of the
selling price
deferred to an agreed
later date.
- The merchandise exists
at the time of
contract.
- The Shariah
does not require that the
cost price be known to the buyer.
Ijarah
Definition: A sale of the use of another’s
property. 107
- The property
Ownership of Assets
The purpose of contracts is to obtain ownership of
asset or the ownership of benefits of the assets.
Where there are two contracts, one immediately
following the other proper sequence in their
executions must be followed.
This sequence applies-

- in refinancing (Bai Inah)
- in Ijarah facility where the asset must be
purchased for the Ijarah or the asset must be
leased for secondary lease.
108
Real Sale and Purchase
In contracts of exchange there must be real

buying and selling to make them valid:
- there must be mal (assets) being exchange with

assets.
To make contracts real and valid they must have

essential elements with their necessary
conditions.
109
Real Sale and Purchase, cont.
Essential Elements of Contracts
The essential elements of contracts of Sale and
Ijarah are:
Sale Ijarah
- seller -
lessor
- buyer -
lessee
- asset - asset
- price - benefit
(use or usufruct)
- contract - rental
110
1. Contract of Sale
The essential elements of a contract of sale with the
necessary conditions are:
1. Contract :Offer and Acceptance
(i) Absolute and in definite and
decisive language.
- in the past or present tense.
- not in the future or imperative
tense.
- not conditional
- not limited to a certain period.
(ii) The acceptance must agree with the
offer.
(iii) The offer and111acceptance must be made
at the one and same
Contract of Sale, continued
2. The Thing Sold
(i) It must exist

(ii) It must be capable of being delivered.
- free from encumbrances.
(iii) It must be known
- by address ,description or
specifications.
(iv) It must be owned by the seller.
- or agent,or natural,or
appointed
guardian of the owner (wali mal).
112
(v) It must have some use.

(vi) It must be of pure substance.
- It must not be of any
of the following
substances:
- dogs and pigs
- every intoxicating liquid
- carcasses
- blood, pus and vomit
- droppings and urine
- milk of animals not eaten by
men.
113
3. The Price
- It must be known in currency and
absolute amount.
4. The Seller
(i) He must be capable of taking
responsibility.
- of sound mind (aqil)
- has attained the age of puberty (baligh)
- has attained majority (rasheed/ 18
years old)
114
(ii) He must not be prohibited from dealing

with his property.
- not bankrupt
- not prodigal
(iii) There is no coercion exerted him.
5. The Buyer
(The necessary conditions are the same as
those for the seller.)
115
2. Contract of Leasing
The essential elements with the necessary conditions are:
1. Contract: Offer and Acceptance

(i) In definite and decisive language.
- in the past or present tense
- not in the future or imperative tense.
(ii) The acceptance must agree with offer
(iii) The offer and acceptance must be made at the

one and same meeting.
116
Contract of Leasing, continued
2. The Asset
(i) It must be owned by the lessor.
- or agent , or natural , or appointed guardian of the
owner(wali mal).
(ii) It must be specified and known

- by address description or specifications.
(iii) It must be delivered to lessee

- in good working condition.
117
3. The Benefit (use or usufruct)
(i) It can be fixed in value
(ii) The lessor has the power and capacity to use and
lease the asset
(iii) It must be permissible
(iv) It must be known
- the purpose for which the asset is used must be
known
- the period of leasing must be known.
(v) It must not be any material part of the asset.
118
4. The Rental
- It must be known in currency and absolute amount
5. The Lessor
(The necessary conditions are the same as those for
buyer and seller.)
6. The Lessee
(The necessary conditions are the same as those for
buyer and seller)
119
3. Bai Inah
Bai Inah must meet the following requirements:
1. There must be two separate contracts properly

executed. 1st the contract of sale by
bank to customer on deferred payment
terms. 2nd the contract of repurchase by
bank from customer on cash terms.
2. The merchandise or the asset must not be a
ribawi material in the medium of exchange category
(gold, silver or currency) because all payments for
purchases are made in money.
3. Each of the two contracts must have the

essential elements and each of the essential
120
element must meet the necessary
4. Bai Dayn
The requirements of Shariah concerning Bai Dayn
are:
1. A debt must have been created through a

contract of deferred payment sale of goods or
service.
2. The goods must have been delivered or the
service must have been rendered.
3. The trading of the debt must be on cash terms.
121
Musharakah &Mudharabah
Musharakah is a general partnership whereby two or

more parties into a contract to exploit their labour and
capital jointly and to share the profits and losses of the
partnership.
Mudharabah is a contract where the owner of capital

entrusts his funds to an entrepreneur who contributes
skills in a business and the profits generated is to be
shared between them.
122
Essential Elements of Musharakah &
Mudharabah
Musharakah
Mudharabah
- partners - owners of capital
- capital - entrepreneur
- business - capital
- profit sharing and - business
- contract - profit
sharing and
- contract
123
5. Musharakah
The essential elements and the necessary conditions are:
1. Partners
- capable of appointing agents &being appointed
as agents.
2. Capital
(i) asset valued in money
(ii) not debt
(iii) specific amount
(iv) paid into capital fund
124
Musharakah, continued
3. Business
(i) Halal
(ii) All partners have right to manage
4. Profit sharing
(i) According to proportion of shares or according to
agreement in fraction ,ratio or percentage; not in
absolute amount.
(ii) Loss borne according to proportion of shares.
5. Contract
- Absolute and in definite and decisive language.
125
6. Mudharabah
The essential elements are necessary conditions are:
1. Contract
- Absolute and in definite and decisive
language.
2. Owner of capital
- Capable of appointing agents and being
appointed as agent.
3. Entrepreneur
- Capable of appointing agents and being
appointed as agent.
126
Mudharabah, continued
4. Capital
(i) In money only
(ii) Not debt
(iii) Specific amount
(iv) Paid to entrepreneur
(v) From owner of capital only
5. Business
(i) Halal
(ii) Managed by entrepreneur only.
6. Profit sharing
(i) Profit shared according to agreement in
fraction,
ratio or percentage ,not in absolute amount.
(ii) Loss borne
127
by owner of capital only.
7. Security
The Shariah allows the owner of debt to ask for

security for his debt from debtor. Securities are in
the form of:
(i) Rahnu (mortgage in the form asset), and
(ii) Kafalah (guarantee being a person).
Among characteristics of Rahnu are:

- Sale of mortgaged property is invalid
- Mortgaged property can be sold by court
order to pay for the debt for which it is
mortgaged. The balance if any, after
payment of debt is to be returned to
mortgagor.
128
8. Wadiah
There are two forms of Wadiah:
(i) Wadiah Yad Amanah (Trustee Safe Custody)
(ii) Wadiah Yad Dhamanah (Guaranteed Safe
Custody)
Originally Wadiah is of Yad Amanah where the

custodian has the duty to protect the property by:
(i) Not mixing or pooling the properties (money)
under his custody.
(ii) Not using the properties.
(iii) Not charging any fees for safe custody.
If he failed in any of the above Wadiah changes to Yad

Dhamanah where:
- he has to return (replace) the properties to the
owners if they were lost or destroyed.
129
9. Qardh Hasan
In giving Qardh Hasan the two following matters
must be observed:
1. The lender must not impose any extra payment in

the
contract.
2. The borrower must not promise in the contract to
pay
anything extra.
130
10. Ibraa’
Ibraa’ is where a creditor lets go of his right to a

debt. Normally it is given for early settlement of debt.
Two of the most important characteristics of Ibraa’
are:
(i) The amount of Ibraa’ must be known and
specified, and
(ii) When the Ibraa’ is given and accepted it is
forbidden and invalid for the party
who gives to withdraw it.
Thank you
Wassalamu alaikum
131
Appendix
Islamic Banking and Financing Products Based on

Concepts and Contracts
DEPOSITS
1. Wadiah: - Current Account
- Wadiah Savings Account
2. Mudharabah - Ijraa Savings Account
- Wadi Savings Account
- Mudharabah Savings Account
- Pewani Savings Account
- General Investment Account
- Special Investment Account
- Sakinah Investment Account
3. Bai Dayn - Negotiable Islamic Debt Certificate
132
Appendix

RETAIL FINANCING
1. Bai Bithaman Ajil - Baiti House Financing
- Land Financing
- Shop & Shophouse Financing
- Umrah & Ziarah Financing
- Tour Package Financing
- Naqad Overdraft Facility
- Vehicle Financing
- Golf Financing
- Education Financing
133
Appendix

2. Bai Istisna’a - Baiti Home Financing

- Shop & Shophouse Financing
- Machinery/Equipment Financing Scheme
3. Ijarah - Shop & Shophouse Financing
- Personal Computer Financing
- Machinery/Equipment Financing Scheme
4. Bai Inah - Personal Financing
- Consumer Goods Financing
5. Rahnu - Al-Rahnu Scheme
134
Appendix

TRADE FINANCING
1. Bai Murabahah - Letter of Credit
- Murabahah Working Capital Financing
2. Kafalah - Letter of Guarantee
3. Bai Dayn - Islamic Accepted Bill - Import
- Islamic Accepted Bill - Export
- Islamic Export Credit Refinancing
Scheme
OTHER SERVICES
1. Hiwalah - Remittances
2. Bai Naqdi - Sale/Purchase of Foreign Currency
- Sale/Purchase of Travellers’ Cheques
135
CHAPTER 5 & 6
DEPOSIT & LENDING MANAGEMENT

DEPOSIT PRODUCTS
• CURRENT ACCOUNT (WADIAH/QARD)
DEPOSIT
• SAVINGS (WADIAH/MUDARABA) DEPOSIT
•INVESTMENT (MUDARABA) DEPOSIT
CURRENT ACCOUNT
• As with other banks, this account essentially provides for safekeeping of

one’s deposit.
• Withdrawals from this deposit account, including checks drawn for and
against it, is guaranteed and honored by the bank. While the safekeeping
service is provided free of cost, banks also provide many additional
features that ensure easy access to withdrawals whenever and wherever
needed, such as automated teller machine cards, charge card, traveler’s
cheques and so on.
• The products is based on various alternative Shariah mechanisms. Some
banks model these deposits on wadiah-wad-dhamanah or guaranteed
deposits. Under this mechanism, the deposits are held as amana or in trust
and utilized by the banks as its own risks
CURRENT ACCOUNT (cont’d)
• The depositor does not share in the risk or return in a any form. Any profit
or loss resulting from the investment of these funds accrues entirely to the
bank.
• Another view is to treat these deposits as qard or benevolent loan by the
depositor. Accordingly the bank operates “qard hasan current account”. As
in the above, the bank is free to utilize these funds at its own risk. The
depositor in its role as the lender is not entitled to any return as the latter
would constitute riba.
• The qard hasan model is less popular than the wadiah model among
bankers for the simple reason that marketing considerations demand
providing additional benefits to the depositor. Under qard hasan
framework, benefits to a lender (the depositor in this case) are rightly
frowned upon as being against the spirit of this mechanism.
SAVINGS (WADIAH/MUDARABA)
1. This deposits account basically serves the need for the safekeeping of
one’s surplus funds while providing a modest return.
2. Savings deposit however, differs from current account deposit in that the
bank now provides a return to the depositor, purely at its discretion as a
gift. Such gift is not part of the contract.
3. The following are the main features of this product. The product requires
the Islamic bank :
o To accept deposits from its customer looking for safe custody and a degree
of convenience in their use of their funds.
o To request permission from such depositors to make use of their funds so

long as the funds remain with the bank
o To claim ownership over all profits derived from the use of such funds
SAVINGS (WADIAH/MUDARABA) (cont’d)
o To reward the customers by returning a portion of the profits, if any from

time to time, at its absolute discretion
o To guarantee withdrawal or refund of a part or the whole of their balances
wherever they so desire.
o To provide the depositors with withdrawal facilities such as savings book,
ATM’s and other related facilities.
4. Generally, the gift or reward on deposit is granted if the customers meets
the minimum deposit required under this account.
5. The bank now requires the depositors to authorize the bank (or appoint
the bank as mudarib) for the purpose of investing the funds. However,
depositors have the right of withdrawal. Profits are calculated on the basis
of the minimum balance maintained for a time period (e.g : month). The
minimum balanced mantained is deemed as the investment for that time
period. A minimum balance is required to be mantained in order to
qualify for a share in profits.
INVESTMENT (MUDARABA) DEPOSITS
1. The product is based on the concept of mudaraba and as such, is such, is

also known as profit and loss sharing (PLS) deposit or participatory
deposit. It is perhaps the Islamic counterpart of the conventional fixed
deposit product that disallows withdrawal prior to a maturity period.
2. The product is based on the concept of mudaraba. Depending upon the

degree of freedom accorded to the bank as the mudarib , intended end
use of funds or eligibility of depositors, there are several types of
investment deposits.
3. There are several types of investment deposits :

o General Investment Deposits
This is a popular deposit product of Islamic banks under which an

investment pool is established. The pool includes investments deposits
of different maturities. The funds are not tied to any specific investment
project but are utilized in different and continuous financing operations
of the bank. Profits are calculated and distributed at the end of the
accounting period, which is either three months, six months or one year.
INVESTMENT (MUDARABA) DEPOSITS
o Special Investment Deposits
This deposit account is similar in all respects to General Investment

Deposit except that the depositor should meet the required minimum to
invest in this product. For instance, the bank may selectively accept
deposits from the government and / or the corporate customer. The
product provides the bank with specific authorization to invest in a
particular project or trade and the profits of this particular project only
are distributed between the bank and its customer accordingly to
mutually agreed terms and conditions.
o Limited and Unlimited Period Investment Deposits
This products under the former are accepted for a specific period, which
is mutually determined by the depositor and the bank . The contracts
terminates at the end of the end of the accounting period. Deposits are
automatically renewable unless a notice of three months is given to
terminate the contract. No withdrawals or further deposits are permitted
in this kinds of contract, but customers are allowed to open more than
one account.
FINANCING
PRODUCTS
DEFERRED PAYMENT FACILITY ( BBA WITH COST PLUS SALE
(MURABAHA)
LEASING (IJARA) FACILITY
DEFERRED DELIVERY SALE (SALAM) FACILITY
MANUFACTURE SALE (ISTISNA’) FACILITY
RECURRING SALE (ISTIJRAR) FACILITY
BENEVOLENT LOAN (QARD) FACILITY)
REPURCHASE (BAI AL EINAH)
BILL DISCOUNTING/ FACTORING (BAI AL DAYN)
TRIPARTITE SALE (TAWARRUQ) FACILITY
BAI BITHAMAN AJIL (BBA)
o Bai bithaman ajil (BBA) or simply bai mu’ajjal is a sale where payment of
price is deferred to a future date. Often it includes features of a murabaha,
which implies a sale on a cost plus basis.
o As a financing product, bai muajjal murabaha is a very popular, and
perhaps the most popular product. BBA is a Shariah approved mechanism.
The mechanism may be described as follows. Individual A is in need of
commodity X. He approaches Bank B. Now, B buys X from the vendor
/supplier at price P. This price is also known to A. Next, B sells X to A at a
marked-up price, say P+M, where M is agreed profit or mark up taken by
B. The payment of price P+M is now deferred to a future date and is made
in full or in parts.
o BBA or bai mu ‘ajjal simply implies deferment of payment of price
irrespective of whether the cost or mark up are known to parties or not. In
a murabaha, both parties to the transaction must know the cost and the
profit or mark up. Where the seller does not disclosure the cost and profit
thereon, the transaction is called musawama.
LEASING (IJARA) FACILITY
o Ijara in simple terms, implies leasing or hiring of a physical asset. It is a

popular debt based product in which the Islamic bank assumes the role of
an ajir or mujir (lessor) and allows its client to use a particular asset that it
owns. The clients or mustajir (lessse) is in need of the asset. Through ijara,
it receives the benefits associated with ownership of the asset against
payment of predetermined rentals (ujrat). Ijara is for a known time period
called ijara period.
o In Ijara, the bank continues to be the owner throughout the ijara period
while the client receives the benefits of ownership or the benefits of using
the asset. As such, risks associated with ownership of the asset remain
with the bank and the asset is supposed to revert back to the bank at the
end of the ijara period.
DEFERRED DELIVERY SALE (SALAM)
FACILITY
o A salam deferred delivery contract. It is essentially a forward agreement

where delivery occurs at a future date in exchange for spot payment of
price.
o Unlike earlier mechanism of murabaha and ijara, salam or salaf was
originally designed as a financing mechanism for small farmers and
traders. Under a salam agreement, a trader in need of short term funds
sells merchandize to the bank on a deferred delivery basis. It receives full
price of the merchandize on the spot that serves its financing need at
present.
o At a pre agreed future date, it delivers the merchandize to the bank. The
banks sells the merchandize in the market at the prevailing price. Since the
spot price that the bank pays is pegged lower than the expected future
price, the transaction should result in a profit for the bank.
MANUFACTURE-SALE (ISTISNA’) FACILITY
o An istisna is a contract of manufacture. A seller under an istisna’

agreement undertakes to develop or manufacture a commodity with clear
specifications for an agreed price and deliver after an agreed period of
time.
o The unique feature of istisna’ is that nothing is exchanged on spot or at the
time of contracting. It is a pure and perhaps the only forward contract
where the obligations of both parties relate to the future. The buyer makes
payment of price in parts over the agreed time period or in full at the end
of the time period.
o Istisna’ facility is suitable for commercial or residential buildings,
industries, roads, aircraft, vessels and so on.
RECURRING SALE (ISTIJRAR) FACILITY
o Under istijrar, the buyer purchases different quantities of a given

coomodity from a single seller over a period of time. In other words, the
seller delivers the total quantity of commodity purchased in installments.
There is some divergence of views regarding timing of fixation and
payment of price.
BENEVOLENT LOAN (QARD) FACILITY
o This is the simple of all financing schemes. Under this schemes, a

borrower in need of a specific amount of funds borrows the same from a
lender as qard hasan with or without a clear stipulation regarding the
maturity date. The loan is repaid on maturity without an increment or
interest. When no maturity is stipulated, the loan is repaid when asked by
the lender, again without any increment.
o The early loan schemes introduced by many interest free credit societies
when the modern Islamic bank was yet to come into existence were based
on this concept. The lender is allowed to ask for an asset as collateral that
is governed by the fiqhi rules of al rihn.
REPURCHASE ( BAI AL EINAH)
o The first and a very popular mechanism used by Islamic Banks in South
East Asian countries is based on repurchased or bai al einah.
o A murabahah can change into bai al einah if the identity of the vendor is
not different from its client; when the banks purchases a commodity
from its client on a spot basis and sells it back to the client at a cost plus
price and on a deferred basis.
BILL DISCOUNTING/FACTORING (BAI AL DAYN)
o Discounting bills of exchange is quite commonplace is conventional

banking.
o A bills of exchanged originates with sale or purchase. The seller draws a
bill of exchanges asking the buyer to pay a certain amount (value of
purchase plus interest) after a certain time period called maturity. When
the buyer accepts the bill of exchanges, it becomes a valid financial
instrument that can be traded in the market.
o Another similar financial product that involves bai al dayn is factoring in
which a company transfers its selected accounts receivables to a bank
(factor). The bank is now assigned the accounts receivables and entrusted
with the task of collecting the receivables. Against these receivables, the
banks provides financing.
o While an Islamic bank may legitimately charge a fee for its collection
activities, it cannot accept interest on the loan extended.
TRIPARTITE SALE (TAWARRUQ) FACILITY
o Tawarruq is another financing product that is cited as a classic case of

hiyal, or legal but has been permitted by mainstream scholars under
certain conditions.
o Tawarruq becomes a source funds by combining two separate sale and
purchase transactions.
o An individual in need of funds purchases a commodity on a deferred
payment basis from a seller and then sells the same in the market in order
to realize cash. This is considered a hiyal, since the individual concerned
has no real intention of buying or selling the commodity. He engages in
these purchase and sale transactions for realization of cash.
CHAPTER 7:
Financing Supervision and Documentation
OBJECTIVE
By the end of the session we will be able to

Understand the Islamic Financing principle
and Its Applications , Know how the Bank’s
Purchase Price & the Bank’s Selling Price are
Computed, What is the Islamic Guiding Principles
used for Islamic banking institution and
understand other Islamic contractual
relationships
INTRODUCTION : ISLAMIC BANKING/
FINANCING
Islamic Financing involves the channeling of resources from wealth holders to deficit producing
Or consuming units. The financing not only means of cooperation necessitated by the absent of
Compatibility in endowment distribution, but also as a source of income
Under the Islamic Guiding Principles, there are strict prohibitions that must be adhered to :
Transaction involving RIBA ( excesses over loan )

Transaction involving GHARAR ( risk / hazard / danger )
Transaction involving MAYSIR ( gambling / contest )
Transaction involving HARAM activities ( alcoholic beverages )
Question : How does the Islamic Bank avoid interest?

Answer : Change the contractual relationship.
- DEPOSITOR – CUSTODIAN
Islamic View - INVESTOR – ENTREPRENEUR
- SELLER – BUYER
OVERVIEW OF CIMB ISLAMIC
BANK
• CIMB Islamic Bank Berhad is the global Islamic banking and
finance arm of CIMB Group. CIMB Islamic products and
operations are managed in strict compliance with Shariah
principles under the guidance of the CIMB Islamic Shariah
Committee, which comprises the world’s leading Islamic
scholars. CIMB Islamic Bank offered various types of Islamic
Financing Concept such as BBA (Bai’ Bithaman Ajil), Bai’ Al
Inah, Al Ijarah, Al Qardhul Hassan, Bai Al-Salam, Bai Al-
Dayn, Murabahah, Istisna, Bai’ Al Istiral and Musyarakah.
THE MOST POPULAR CONCEPT USED IN ISLAMIC FINANCING BANK
(1)BAI’ BITHAMAN AJIL (BBA) - Deferred Payment Sale ( Seller / Buyer )

• Refers to sale of goods on a deferred payment basis at a price
which is agreed by both parties.
• BBA application in Islamic Financing such as Home Financing (HF–i),
Property Financing (PF–i ), Cash Line (CL–i) and Term Financing
(TF–i) .
• Example : Home Financing - i
ank sells an asset

o the customer
ank buys the asset from customer then Customer pay on

esell to customer the same for a profit Deferred basis
2
BBA Cont .. Customer go to developer / vendor.
Buy the house. Signed the Sale &
Purchase Agreement with
developer / vendor
6 Banks pays
developer /
5
Bank will sell back the property to
customer at The Purchase price Plus vendor
profit. Customer & Bank signed
Property Sale Agreement
( PSA )
y s t he
pa
7
r
1
t om e
Cus k ’s
Customer : found B a n b y
a suitable house Pr i c e
l l i ng t s Bank buys the property
Se en From customer at the
4
l l m
insta Bank’s Purchase price.
3
Customer & Bank signed
Customer goes to the Property Purchase
Agreement ( PPA )
Bank for financing
BBA Cont..
Bai’ Bithaman Ajil (BBA) – Calculation of Bank’s Purchase Price
Remaining amount due to developer / vendor
Mortgage Reducing Term Takaful ( MRTT )

†
Any other amount financed by bank (depending

on the package offered )
** BANK’S PURCHASE PRICE
** Bank’s Purchase Price also known as Financing Amount

BBA Cont..
BBA – Calculation of Bank’s Selling Price – Completed Property

Step 1 – Obtain installment amount from calculator
PRICIPAL RM100,000.00
TENOR (in months) 120 INSTALLMENT
FINANCING RATE (Y1) 4.00% RM1,012.45
FINANCING RATE (Y2) 5.50% RM1,078.39
FINANCING RATE (Y3 & +) 7.25% RM1,150.21
Step 2 – Sum up all installment to get the bank’s selling price
yr 1 yr2 yr3 & +

INSTALLMENT + INSTALLMENT + INSTALLMENT
BBA Cont..
BBA – Calculation of Bank’s Selling Price – Completed Property
YEAR 1 = RM1,012.45 X 12 = RM12,149.40
YEAR 2 = RM1,078.39 X 12 = RM12,940.68
YEAR 3 = RM1,150. 21 X 96 = RM110,420.16
BANK’S SELLING PRICE = RM135,510. 24

BBA Cont..
BBA – Calculation of Bank’s Selling Price – Under Construction
BANK’S SELLING PRICE
Total Progressive Total Installments = Monthly

Installment
Profits = Bank’s + x Installment Period ( in months )
Purchase Price x
Applicable Profit rate
10
years
Progressive Installment Period 8
Period 2 years
years
Part I Part II
BBA Cont..
BBA – Calculation of Bank’s Selling Price – Under Construction
BANK’S PURCHASE PRICE = RM100,000.00
FINANCING PERIOD = 10 YEARS
PROGRESSIVE PERIOD = 2 YEARS
1st YEAR = 2.15%
2nd YEAR = 5.00%
3rd YEAR = 7. 25%
YEAR 1 = RM100,000.00 X 2.15% = RM2,150.00

YEAR 2 = RM100,000.00 X 5.00% = RM5,000.00
YEAR 3 = RM1,375.85 X 96 = RM132,081.16
ONWARDS
(Installment Profits)
BANK’S SELLING PRICE = RM139, 231.16

BBA Cont..
BBA – Calculation of Bank’s Selling Price – Lump Sum
PRICIPAL RM100,000.00
TENOR (in year) 5
FINANCING RATE 6.00%
BANK’S SELLING PRICE = PRINCIPAL + PROFIT

= RM100,000 + (RM100,000 X 6.0% X 5 YEARS)
= RM100,000 + RM30,000
= RM130,000
BAI Cont..
(2)BAI’ AL -INAH (BAI) – Underlying Assets ( Seller / Buyer )
• Refers to sale of goods (underlying assets) on a deferred payment
basis followed by a cash purchase by the original seller
• The documentation of Bai Al-Inah is the reverse of the BBA
• Bank purchased back the asset on cash basis
• The Bank’s Purchase Price is recorded in the PPA (Property
Purchase Agreement)
• Example : Personal Financing - i
CUSTOMER = BUYER
BANK = SELLER
BAI Cont..
BAI’ AL -INAH (BAI) – Underlying Assets ( Seller / Buyer )
1Customer applies financing from

bank
2 Bank sells it’s asset on deferred basis.
Signed **(PSA)
3 Bank buys back the asset from customer
Signed **(PPA)
4
Bank pays cash to customers
5 Customer pays the financing on

deferred payment
** PSA ( Property Sales Agreement )

PPA ( Property Purchase Agreement )
BAI Cont..
BAI’ AL -INAH (BAI) – Underlying Assets ( Seller / Buyer )
Sum up all installment to get the Bank’s Selling Price
YEAR 1 YEAR 2 YEAR 3
INSTALLMENT + INSTALLMENT + INSTALLMENT

INSTALLMENT INSTALLMENT INSTALLMENT
INSTALLMENT INSTALLMENT INSTALLMENT
Bank’s Purchase Price

IS
The amount that the Bank wants to lend out
OR
Also known as Financing Amount
(3)AL – IJARAH / AL IJARAH THUMMA AL – BAI ( Lessor / Lessee )

• Refers to an arrangement whereby an owner of property (the
Lessor) allows another party (the lessee) to benefit from the use
of the asset at a fee over a specified period
• It is the selling of benefits, usage or service for a price (i.e. lease
rental) by the owner of an asset.
• Example : Hire Purchase Financing – I / Vehicle Financing
Lessee = Person
Lessor = Owner Who
holds the asset
Ijarah Cont..
AL – IJARAH / AL IJARAH THUMMA AL – BAI

( Lessor / Lessee )
1Owner allows another party to use

his asset
2 Lessee pays a price for the benefits

from the use of the
asset (i.e. rental )
Al Ijarah Thumma Al-Bai - Lease with option to purchase.

- At the end of a specific period
the ownership of the asset will
be transferred to the lessee
TYPE OF FINANCING / FINANCINGS OFFER
RETAIL FINANCING BUSINESS FINANCING
PROPERTY NON PROPERTY PROPERTY NON PROPERTY
PERSONAL FINANCING /
HOME FINANCING HOME FINANCING TERM FINANCING
TERM LOAN
BUSINESS PREMISES /
CREDIT LINE BUSINESS PREMISES /
COMMERCIAL BULDING CASH LINE
( OVEDRAFT ) COMMERCIAL BULDING
LAND ( TERM LOAN )

LAND ( TERM LOAN ) REVOLVING CREDIT
TRADE FINANCE
FACILITIES
PROCEDURES INVOLVED
( Business Rules)
Procedures involved refers to Retail Credit

Centre Internal Guidelines summarized the
main underwriting criteria for Retail and Business
banking product for CIMB Islamic Bank. This
internal guidelines involved 8 levels of procedures
• 1 - ELIGIBILITY :
– Individual
• Minimum age of applicant/guarantor – 18 years old and maximum is
70 years old.
– Joint
• Tenor can be based on the younger applicant who must be gainfully
employed and meet the minimum employment duration on 6 months.
– Min. employment - Duration is 6 months (including previous

employment)
– Applicant Must Not Unsound Mind, Must Not involved in AMLATF

activities and Must Not an undercharged bankrupt.
• 2 - INTERVIEW :
– Face to face with the applicant at least once , to check :

• applicant background and genuinely of the document and applicant.
• Data provided is consistent with what is written and correctly entered.
– Applicant must sign and completed the form

• Tenor can be based on the younger applicant who must be gainfully
employed and meet the minimum employment duration on 6 months.
– Joint – Single signature is allowed for acceptable relationship
– But, Upon acceptance of the facility the Application Form and

Letter of Offer must be fully signed by all parties.
• 3 - ACCEPTABLE CO-APPLICANT :
On asset/collateral owner and Loan/Financing application
Relationship to applicant :
– Husband
– Wife
– Parents
– Siblings
– Children
Note: At least one of the asset/collateral owners must be a party to the loan/Financing
• 4 - NON RESIDENT / FOREIGNER – (MUST RESIDE IN

MALAYSIA) :
– Allowed to apply for non-mortgage loan/financing subject to the ECM rules.

• 5 - REPAYMENT CAPACITY :
Using : DEBT SERVICE RATIO (DSR) :
Total Monthly Debt Obligation Global

DSR Global =
Combined Monthly Gross Income
• Applicant monthly income up to RM5k - DSR up to 75%

• Applicant monthly income exceeding RM5k - DSR up to 85%
• Guarantor’s is excluded
6 – INCOME :
INCOME COMPONENT COMPUTATION
Annual income in Form B/BE/J of Inland 100% of (AI) stated in Form B/BE/J
Revenue Department divide by 12 months = ( AI / 12 )
Annual income in EA form for salaried individual. 100% of (AI) stated in EA form divided by
* For self – employed EA form NOT acceptable 12 months = ( AI / 12 )
EPF contribution statement (which display at least Average of 6 months ‘Employee

Contribution
6 months of contributions) divided by 11%
Monthly pay slip – Basic Salary 100% of latest basic salary
Monthly pay slip – Fixed Allowance 100% of latest fixed allowances
Monthly payslip – Variable Income such as : 100% of 3 months average

Overtime
Variable Allowances
Commission
Service Points
Pension 100% of latest monthly pension

payment
Monthly pay slip – Expenses claim NOT ELIGIBLE for monthly income
computation
Monthly payment – Tips NOT ELIGIBLE for monthly income

computation
Personal Bank statements showing salary credit Average of 3 months salary credit
*Salary Deduction Adjustment Factor
applicant (self – employed is EXCLUDED)
Net Salary Credited Salary Deduction

Adjustment Factors
= / < RM2,000 111%

*This estimation is only applicable for salary > RM2,000 to =/< RM5000 115%
> RM7,000 to =/< RM7500 125%

Applicant (self-employed is EXCLUDED)
> RM7,000 to =/< RM10k 135%
> Rm10,000.00 145%

Interest income from fixed deposit or profit from NOT ELIGIBLE for monthly income
Islamic FD equivalent (proof provided) computation
Dividend income (proof provided) 100% of gross dividend income stated in the
dividend warrant divided by 12 months
Rental income (proof provided) 100% of 3 months average rental income
Bank statement of business owned by a self-employed / Monthly Income = Ownership % * 20% *

partner / directors average turnovers
This estimation is only applicable fro self-employed / Average credit turnovers must be estimated
partner / directors. (Salaried individual is EXCLUDED) using the 3 months bank statements. This
computation allowed if the self-employed

applicant submits less than months bank statmnt
Personal Saving / Current / FD accounts owned by a Monthly income = ( 20% average credit turnovers)
self-employed / partners / directors Numbers of account holders
This estimation is only applicable for self-employed / Average credit turnovers must be estimated
partner/director. (Salaried individual is excluded) using the 3 months bank statements. This
computation method allowed if the self-employed
applicant submits less the months bank statement
• 7 - CREDIT CHECKINGS :
CCH / CCRIS – On Applicant & Guarantor
- Fail if is unfavorable (No 3MIA in the last 6 months)

- Fail if facilities are impaired loans/financing or under legal action
- Further scrutiny is required for applicant above 30 years old without CCH/CCRIS record
- Fail if any Special Attention Acct. (SAA) in CCH/CCRIS.
- Also compulsory for guarantor if any.
But Exception may be given to housing loan/financing-I for abandoned project (with documentary evidence)
- Where balance outstanding is less than RM25k or due to small outstanding of RM10k or less.
Credit Tip Off Service (CTOS) - positive
- Shall be processed if applicant only guarantor to any facilities and bankrupt

- Fail if name & IC matched with legal cases outstanding.
- Can be considered / processed if legal case has been settle for more than 6 months from
the date of application of the loan / financing
- To exclude legal case of more than 7 years without any further action except for bankruptcy cases
- Also compulsory for guarantor if any.
DCHEQS – Dishonor Cheque/s
- Fail if 3 cheques returned –due to insufficient funds in the past 12 months or
account
closed to unsatisfactory conducted
FRAUD CHECKING (INSTINCT)

- Fraud checks via INSTINCT for both Islamic and Conventional.
- Any suspected fraudulent / dubious application will be checked by
Retail
Credit Officer (RCO) who will reject if it is confirmed
• 8 - TYPE OF COLATERAL
– NON PROPERTY
(1) Fixed Deposit / GIA-I / FRIA

- MOF up to 100%
- Only applicant’s copy of IC required – Income not
required
- Only the principle portion of FD can be recognized as
security value for Islamic Financing
(2) UNIT TRUST

- MOF up to 60% for Unit Trust issued by CIMB Group
- MOF up to 90% of ASB amount (for CIMB Bank loans only)
(3) STOCK AND SHARE / SHARIAH COMPLIANT STOCK AND
SHARES
- MOF up to 60%
- Stock and share quoted on BMSB (Bursa Malaysia Securities Bhd.)
- Unquoted shares ARE NOT acceptable
- Shares of licensed FIs / IFIs pledged as collateral shall not be aggregated
to more than paid up capital of the license FIs / IFIs concerned as
stipulated in BAFIA S21 of Islamic Banking Act 1983.
- Only Shariah Compliant stock and share are accepted.
(4)INVESTMENT LINK (or any CAPITAL GUARANTEED / PROTECTED FUND)

AND OTHER STRUCTURED PRODUCT / DEPOSIT ISSUED BY CIMB GROUP
- MOF up to 80% of (FACE VALUE)

BUSINESS FINANCING
( NON PROPERTY- PROJECT ASSESSMENT )
PETROPACK
–I
Bank
Cash Line Financing Guarantee
– I ( CL – Package – For – I ( BG –
I) Petronas Petrol I)
Station
For the
Up to 5 years Term financing of
For the purchase fixed asset,
of petroleum, Financing purchases for
petroleum ( TF – I ) retail /
product and convenience
working capital store and
As performance bond, working capital
tender guarantee, security
deposit to oil companies
and other purposes related
to its business
BUSINESS FINANCING
( NON PROPERTY- PROJECT FINANCING )
Cash Line PRO Finance – I Term

– I ( CL – Package Financing
I) For Professional SMEs :
– I ( TF –
Doctors, Dentists, I)
Veterinarians, Accountants,
Pharmacists, Engineers, Up to
Up to Architects, Surveyors, Panel RM300,000.00
RM200,000.00 Values of CIMB Group and For business
For working Advocates & Solicitor
expansion,
capital registered under any State Bar
Council, preferable with 2 capital
requirements expenditure,
years in operations
asset acquisition
requirements
- Total Financing Limit = RM500,000.00
- Up to 3 years with option to renew and subject and / or
to renovation of
annual review business
premises
As the customer may not have acceptable underlying asset, it is - Total Financing Limit = RM500,000.00
advisable to use shariah concept of Bai’ Al Inah instead of Bai’ - Max 8 years or max 5 years (for FSM12
Bithaman Ajil (BBA) /
Under Bai’ Al-Inah transaction, CIMB Islamic Assets will be used as NEF2 only)
the Underlying Assets
RETAIL FINANCING
( NON PROPERTY- PERSONAL FINANCING )
PERSONAL FINANCING
-I
XPRESS CASH –I CASH PLUS – I

FINANCING FINANCING
Concept BAIL AL - INAH Concept BAIL AL - INAH
HIGH PURCHASE –I
AWAM –I FINANCING
FINANCING
Concept BAIL AL - INAH Concept AL-IJARAH
RETAIL FINANCING
( PROPERTY- HOME /BUSINESS PREMISES )
CONCEPT :
BAI’ BITHAMAN AJIL ( BBA )
Bai’Bithaman Ajil ( BBA ) – is a standard Islamic Banking Concept ap
Bank Negara Malaysia which refers to the sale of goods on a deferred pa
basis at a price, which includes a profit margin agreed to by both parties
Underlying Shariah Transaction – The bank shall enter into an agreem

purchase the Underlying Asset at the agreed Bank’s Purchase Price from
Customer. The bank shall subsequently sell the Underlying Asset to cust
the Bank’s Selling Price on a deferred payment basis under the concept
Which payment shall be made of of the original Bank’s Purchase Price a
margin
# For purchase of COMPLETED and UNDER CONSTRUCTION
non-landed residential and commercial properties
RETAIL FINANCING
CONCEPT :
IJARAH MUNTAHIYAH BITTAMLIK
IJARAH MUNTAHIYAH( IMBT ) BITTAMLIK – which means “leasing en
transfer of of ownership”. Three simple steps for IMBT concept ar
Step 1 : Customer applies for Ijarah Property Financing. Bank pur

Property becomes the owner of the property.
Step 2 : Customer ( Lesse or Mustajir ) at an agreed Total Ijarah R

Over a specific lease period ( Muddat Ijarah or Iwadh )
Step 3 : Customer undertakes to purchase the property at the end

at any time by paying the Exercise Price to the bank.
# Only for purchase of COMPLETED landed and non-landed resid

RETAIL FINANCING
1. Fixed rate home financing for 10 years or 20 years. Fixed rate

package will safeguard you from profit rate fluctuations.
2. Variable rate home financing based floating rate features based

on the movement of the Base Financing Rate (BFR) with capped
at an agreed ceiling rate.
3. Combination of Fixed and Variable rate for maximum fixed

rate of 3 years, 5 years and 10 years.
RETAIL FINANCING
Features and Benefits:
 Financing all types of completed or under construction residential properties.
( exclusions : Leasehold properties of less than 45 yrs
: Shopping and office lot in shopping malls and commercial complexes
 Minimum financing amount is RM15,000.00 ( house ) and RM50,000.00 ( premises )
 Margin of financing (MOF) is up to 90% for home financing and 85% for Business
premises.
 MRTT / GMTT can be financed ( 5% from loan amount ). Tenure maximum 30 yrs or
applicant reaches age of 65 yrs.
 Applicant can enjoy flexible financing period of up to 40 years or up to the

age of 70 years, whichever is earlier.
 Non – Free Moving Cost ( Non-FMC ) – Valuation ,Legal and stamping fee are to be
born by customer
 Eligibility : Individuals / Joint Individuals / Sole-proprietorship / Partnership

: The properties to be purchased must for own occupation.
: No financing for investment purposes
RETAIL FINANCING
Mode of payment –
 During construction or development ( progressive period ), payment will be cover profit
portion of the facility as prescribed rate stated above and it is based on the amount disbursed
 Thereafter, payment will be include principal and profit charged.
 For house / premises that are completed earlier than the expected progressive period, and
the facility amount has been fully disbursed, the customer may option to pay monthly
payment immediately and the payment will be charged based on the current profit rate.
 For completed premises, the customer will start to serve the payment in the event of the
first disbursement is less than the Bank’s Purchase Price.
Fluctuation Of Based Financing Rate ( BFR ) –

 Monthly payment may fluctuated based on the movement of BFR. The customer will finish
the period as contracted in Letter of Offer.
 The fluctuation of BFR as follows :-
1. If BFR is at a moving downtrend, the facility payment will be decrease.
2. If BFR is at a moving uptrend, the facility payment will be increase .
3. The customer will be advised of the new payment accordingly regardless whether the
payment amount goes up or down.
RETAIL FINANCING
Excess Payment –
 Any excess amount paid by the customer shall be treated as advance payment under the
facility and is parked in the system as memo item.
Advanced Payment –
 Customer is allowed to make advanced payment based on following terms :-
 Advanced payment ( ‘Go Holiday’ ) Upfront lump sum payment amount for a specific period
of time.
 Advanced + Prepayment. Lump sum payment amount for a specific period time and any
excess is to settle principal amount.
Prepayment ( Partial Settlement )

 Customer is allowed to request reduction of principal amount of the facility under the
following scenarios :-
 EPF withdrawal
 Additional monthly payment
RETAIL FINANCING

Early Settlement / Redemption of Facility –
Settlement Amount Formula During Lock – in Period
= [ ( Outstanding Bank’s Selling Price – Rebate ) + Other Charges ( if applicable ) ]
Where ;
Rebate = Outstanding Profit – Profit Due but Not Paid – Profit Not Rebate
And
Profit Not Rebated =
3% x original Facility Amount or RM5000.00 which ever is higher.
Settlement Amount Formula After Lock – in Period
= [ ( Outstanding Bank’s Selling Price – Rebate ) + Other Charges ( if applicable ) ]
Where ;
Rebate = Outstanding Profit – Profit Due but Not Paid
RETAIL FINANCING
Ta widh ( compensation / late payment ) charges –
Within the facility period
 For failure to pay any monthly payment / progressive payment of the facility from the
date of first disbursement until the last date of the facility period, the compensation
rate that shall be applied is 1% p.a on the overdue amount or any other method
approved by BNM.
After the facility period
 If the facility remains unpaid after the facility period, the compensation rate that shall
be applied is the Bank’s current Islamic Inter bank Money Market ( IIMM ) rate on the
outstanding principal balance or any method approved by BNM.
Outstanding Principal x IIMM Rate X Day in defaults

PROCESS FLOW – ISLAMIC FINANCING
OVERVIEW ( HOME / BUSINESS PREMISES )
Financing Officer Financing Officer
Financing Officer
Start Receive application
conduct interview
Key in info into
RETAIL CREDIT SYSTEM
from customer
( RCS )
Financing Officer Financing Officer Financing Officer

Key in info into Key in info into Sent related documents to
RETAIL CREDIT SYSTEM RETAIL CREDIT SYSTEM
( RCS ) ( RCS ) – Perform credit checking
Retail Credit Center for Approval
RCC Officer RCC Officer Financing Officer

Key In Data and making decision Approve – generate letter offer ( LO ) & Sent to customer
( approve / reject ) sent to Financing Officer through RCS for acceptance
Financing Officer
Click Acceptance, solicitor ( appoint by customer ) and Valuer selection ( refinancing ).
Sent acceptance LO, Insurance form ( MRTT ) to RETAIL CREDIT ADMIN DEPT ( RCAD )
and Solicitor for disbursement
Cont….
RCAD Officer SOLICITOR

RCAD Officer 1.Issue Letter Instruction ( LI ) to lawyer Solicitor conveyance / prepare
Scan Letter Offer through e-mail to act documentations documentations ( loan
2. Generate Account Number Agreements on behalf Bank )
SOLICITOR
CSA Officer CSA Officer
# Stamping Document
Power Attorney ( PA ) # Advise to release
# Register title at Land Office /
execution # 1st disbursement
High Court
SOLICITOR CSA Officer

# Settle / Discharge outstanding
Balance ( old bank )
# Advise FINAL release End
# Last disbursement
# Perfect to New Bank ( CIMB )
DOCUMENTATION IN ISLAMIC
FINANCING ( APPLICATION )
MAIN APPLICANT ( INDIVIDU ) / JOINT APPLICANT / GUARANTOR
Salaried Applicant:
• NRIC photocopy.
• Latest 3 months salary slip.
• Last 3 month bank statement ( saving – salary )
• EA form / EPF statement (last 2 years).
• Sales & Purchase Agreement / Booking receipt from developer / Valuation Report
( If available ).
Self-Employed:
• NRIC photocopy.
• Latest 3 months salary slip.
• EA form / EPF statement (last 2 years).
• Sales & Purchase Agreement / Booking receipt from developer / Valuation Report
( If available ).
• Business registration A&D
• Last 3 months bank statement ( Saving / Current Account )
DOCUMENTATION IN ISLAMIC FINANCING
( APPROVED AND ACCEPT BY CUSTOMER -
( HOME / BUSINESS PREMISES )
Prepared by Financing Officer
• Letter Offer from RCC ( 3 Sets ) – print through RCS

Customer must sign every pages. Financing officer must verify customer’s
signature.
• MRTT Form ( Quotation / proposal form )
• NRIC photocopy ( Original sighted by Financing Officer )
• Fire Insurance ( Proposal form )
• Auto debit form ( for monthly account deduction )

Prepared by Solicitor Prepared by Solicitor
( Legal Documentation For Property With ( Legal Documentation For Property
Land Title ) Without Land Title )
Title ( master / strata ) Letter Offer
Private Caveat on property Property Purchase Agreement
( if applicable ) Property Sale Agreement
Original Sale and Purchase Agreement Sale & Purchase Agreement
of the property Charge and Annexure
( if applicable ) Developer Undertaking letter
Letter Offer Receipt and reassignment
Charge and Annexure Letter Of Disclaimer ( if applicable )
Property Purchase Agreement Deed of Assignment
Property Sale Agreement Memorandum of Deposit
Power Of Attorney ( if applicable ) Letter Guarantee
Letter Of Hibah / Gift (if applicable ) Statutory Declaration
Letter Of Disclaimer ( if applicable ) Bankruptcy search
Any other documentation as advised by Any other documentation as advised by
the Bank Solicitor the Bank Solicitor
Prepared by Valuer
Prepared by Valuer
Valuation Report
• Valuation Report  Contents valuation report is :-
 Wave if direct purchase directly 1. Subject of Valuation
from developers. 2. Purpose of Valuation
 Full valuation report is 3. Date of valuation
compulsory from our approved 4. Definitions valuation
valuer for completed properties
5. Particular of title
purchased from developers
which have been completed 6. Location
more than 1 yrs 7. Description of property
 Full valuation report is 8. Occupancy status
compulsory for all type of 9. Neighborhood
completed properties under sub- 10. Services
sale, refinancing, unencumbered 11. Planning
/ auction properties including 12. Basic off valuation
resort homes and service 13. Evidence of value
apartments.
14. Valuation
15. Land search / grant
FINANCING
CLASSIFICATION
• Asset Quality falls into 3 categories :-
Current / performing loan – good repayment
Delinquent – Overdue with MIA LESS than 3 ( Bank’s practice )
– Overdue with MIA LESS than 6 ( BNM guidelines )
Non performing Loan ( NPL )
– Overdue with MIA GREATER than 3 ( Bank’s practice )
– Overdue with MIA GREATER than 6 ( BNM guidelines )
COLLECTION AND
RECOVERY
Collection
Collect payments from delinquent accounts
Recovery
Collect payments from Non Performing ( NPL ) accounts
Litigation
Collect payments of NPL accounts via legal action
STRATEGIC COLLECTION
ACTIVITIES
3 CONSECUTIVE MONTHS
I MONTH – REMINDER LETTER
2 MONTH – REMINDER LETTER
3 MONTH –
3 MONTH –
2ST LEGAL NOTICE OF DEMAN
ST
LEGAL NOTICE OF DEMAND
( settled within 14 days )
SUMMONS FILED
NON PERFORMING LOAN ( NPL )
( JUDGEMENT )
Notice of Demand
Summons filed Not served
Mention date Personal service
Served by AR registered
Served Not Served
Mention date ( Hearing ) Served by Substituted Service

( court @ premise posting / advertisement
Appearance entered
Not contested No appearance
Contested
Consent Judgment Judgment in default
( JUDGMENT)
Defendant filed defence
Defence filed Defence not filed
Judgment In Default Of Defence
Striking out defendant’s defence Plaintiff’s summary judgment
Judgment Judgment
Application dismissed
( Judgment allowed ) ( Judgment allowed )
Full Hearing
Decision
( Plaintiff’s claim
allowed / dismissed )
( PUBLIC AUCTION )
NOTICE OF
DEMAND
16D NOTICE
Contract breach within 30 days The expiry of the notice varies
according to the annexure
LAND OFFICE HIGH COURT
Title num : H.S. Title num : H.S. ( D ) /
(M) GRANT
16G FORM ORIGINATING SUMMONS &
FILED AFFIDAVIT FILED
( Balance financing / particular grant )
INQUIRY PERSONAL SERVICES
( VISIT / AR )
HIGH COURT
Title num : H.S. ( D ) / GRANT
SUCCESSFUL UNSUCCESSFUL
SERVICE SUBTITUTED
SERVICE
SERVICE
Title num : H.S. ( M )
- ADVERTISE
LAND OFFICE
- COURT POSTING
- PREMISS
POSTING
AFFIDAVIT OF NO APPEARANCE
SERVICE
CERTIFICATE OF
APPEARANCE NO APPEARANCE
FILEDOF
NOTICE
APPOINTMENT APPOITMENT NOTICE
TO HEAR
ORIGINATING
SUMMONS
(NATHOS)
SERVICE NATHOS
Title num : H.S. ( D ) / GRANT

HIGH COURT
AFFIDAVIT OF SERVICE
INQUIRY SUPPLEMENTARY AFFIDAVIT FOR
THE AMOUNT OUTSTANDING
( request statement from the
Title num : H.S. ( M )
bank )
LAND OFFICE
HEARING OF NATHOS
ORDER FOR SALES 1. Appointment of
Auctioneer
VALUATION REPORT
2. Reserve Price
SUMMONS FOR DIRECTION & AFFIDAVIT
3. Date Of Auction
ORDER FOR AUCTION
SALE
( PRIVATE AUCTION )
Issue Notice Of Demand cum Notice to Quit
Letter to Developer for Notification
Letter to Valuer for Valuation Report
Appoint Auctioneer
Auction Date Fixed
Advertisement of Auction
( Letter to Defendant to inform Auction Date )
Auction
FOR PROPERTY WITHOUT TITLE

• LACA – LOAN AGREEMENT DEEP OF ASSIGNMENT
( BANKRUPTCY )
SERVED COPY OF JUDGEMENT ON JUDGEMENT
DEBTOR
IF NO PAYMENT MADE REQUEST FOR ISSUE OF
BANKRUPTCY NOTICE
EXTRACT BANKRUPTCY NOTICE
SERVED BANKRUPTCY NOTICES ON JUDGEMENT

DEBTOR
PERSONAL SERVICE
UNSUCCESSFULL
( BANKRUPTCY )
CONT
…
SUBSTITUTED SERVICE
BANKRUPTCY NOTICE VALID FOR 3 MONTHS. IF
NOT SERVED WITHIN THEN, TO RENEW BY FILLING
APPLICATION TO COURT
NOTICE SERVED
IF NO RESPONSE, FILE CREDITORS PETITION WITHIN
6 MONTHS AFTER SERVICE OF BANKRUPTCY
NOTICE
FILE AND EXTRACT CREDITORS PETITION
PERSONAL SERVICE
( BANKRUPTCY )
CONT
…
UNSUCCESSFUL
SUBSTITUTED SERVICE
PETITION SERVED
HEARING OF CREDITORS PETITION
ADJUDICATION ORDER RECEIVING ORDER (AORO)
PROOF OF DEBT (POD) FILED

CHAPTER 8
THE ACCOUNTING
ENVIRONMENT OF ISLAMIC
BANKS
Accounting Process Accounting
in Islamic Banking Principles
The Accounting
Environment
of Islamic Banks
Financial Statement Report by Syariah

Submissions Committees
ISLAMIC PERSPECTIVE OF
ACCOUNTING OBJECTIVE AND CONCEPTS
“O you who believe! When you deal with each other, in
transactions involving future obligations in a fixed period of
time, reduce them to writing let a scribe write down faithfully
as between the parties; let not the scribe refuse to write: as
Allah has taught him, so let him write. Let him who incurs the
liability dictate, but let him fear his Lord Allah, and not
diminish aught of what he owes. If the party liable is mentally
deficient, or weak or unable himself to dictate, let his guardian
dictate faithfully.”
Surah Al-Baqarah:282)
OBJECTIVES OF ISLAMIC
FINANCIAL ACCOUNTING AND
REPORTING
• Determine rights and obligations of all interested parties in
accordance with the principles of Shari'a
• Subscribe to the safeguarding of the Islamic financial institution’s

assets, its rights and the rights of others
• Subscribe to the enhancement of managerial and productive

capabilities of Islamic financial institutions
• Report useful information to users, thus enabling them to make

legitimate decisions in their dealings with Islamic banks
ACCOUNTING PROCESSES IN
ISLAMIC BANKING -GUIDELINE BY
BNM
Islamic Banking System (SPI) licensed institutions are
required ;
• To disclose separate balance sheet and income statement, cash

flow statement and statement of changes in equity in the notes
to the financial statements of the principal financial
statements.
ACCOUNTING PROCESSES IN
ISLAMIC
• To BANKING
devise GUIDELINE
a separate BY BNM
system of accounting entries and
maintenance of records for all transactions and to prepare a
separate daily trial balance of the operations of the SPI. The
SPI licensed institutions must be able to know the daily
balances of their assets and liabilities which relate to SPI
operations. The licensed institution must introduce specific
account codes for all ledgers for Islamic banking business to
ensure proper accountability of the funds and accounts
• To observe the Guidelines on Financial Reporting for Licensed

Financial Institutions (GP8).
ACCOUNTING PROCESS IN
ISLAMIC BANKING
Financial accounting consists of the following processes:
• Accounting recognition of an entity’s financial rights and

obligations as of a given date and changes in those rights and
obligations resulting from consummated transactions and other
events during a given period.
• Measurement of the financial effect of consummated
transactions and the impact of other events during a given period.
….ACCOUNTING PROCESS IN
ISLAMIC BANKING….
• Classifying the financial effect of consummated transactions
and other events for the purpose of determining the entity’s
results of operations and other changes in its financial position
including its cash flows.
• Preparing periodic reports about the entity’s financial
position as of a given date and the results of its operations and
cash flows during a given period
Needs for Accounting Standard for
Islamic Financial Institutions
• Islamic banking financial reporting practices of central banks
regulation in respective of Muslim and non-Muslim countries
• In Malaysia, for example, it is under the purview of BNM
through guidelines (GP8i), Companies Act 1965, applicable
MASB accounting standard and International Accounting
Standard (IAS)
• Lack of Shari'aconsistency as each bank relied on
Shari'aadvisors of respective banks even with the supervision
of the central banks
…Cont…..
• Lack of comparability and consistency on the accounting
treatment on recognition, measurement and disclosure of
Islamic-based transactions
• Measurement and comparison financial performance of the
banks
• Lack of sound regulation on accounting hinders the
development of Islamic banking
• In Malaysia, efforts by MASB with the guidance of
AAOIFI’sstandards to develop Malaysian accounting standard
for Islamic financial institutions
ACCOUNTING PRINCIPLES
• Accounting and Auditing Organizations of Islamic

Financial Institutions (AAOIFI)
• lslamic Financial Services Board (IFSB)

Accounting and Auditing Organizations
of Islamic Financial Institutions (AAOIFI)
• AAOIFI, formerly known as Financial Accounting
Organization for Islamic Banks and Financial Institutions, was
established in accordance with the Agreement of Association
signed by Islamic financial institutions on 1 Safar, 1410 H,
corresponding to 26 February 1990, in Algeria.
• It was registered on 11 Ramadan 1411 H, corresponding to 27
March 1991 in the State of Bahrain (Kingdom of Bahrain,
now) as an International autonomous non-for-profit corporate
body.
…Cont….
• AAOIFI is responsible for developing accounting, auditing,
ethics, governance, and Shari’a standards for the international
Islamic banking and finance industry. In addition, AAOIFI
contributes significantly to the professional development for
the industry. AAOIFI is supported by over 150 institutional
members from around 40 countries. It has its corporate office
in Kingdom of Bahrain.
• 25 Accounting Standards, 5 Auditing Standards, 7
Governance Standards and 2 codes of ethics
THE 25 ACCOUNTING STANDARDS
SFA 1 Objectives of Financial Accounting for Islamic Banks and

Financial Institutions
SFA 2 Concepts of Financial Accounting for Islamic Banks and
Financial Institutions
FAS 1 General Presentation and Disclosure in the Financial
Statements of Islamic Banks and Financial Institutions
FAS 2 Murabaha and Murabaha to the Purchase Orderer
FAS 3 Mudaraba Financing
FAS 4 Musharaka Financing
FAS 5 Disclosure of Bases for Profit Allocation between Owners’
Equity and Investment Account Holders
….THE 25 ACCOUNTING
FAS 6 STANDARDS….
Equity of Investment Account Holders and Their
Equivalent
FAS 7 Salam and Parallel Salam
FAS 8 Ijarah and Ijarah Muntahia Bittamleek
FAS 9 Zakah
FAS 10 Istisna’a and Parallel Istisna’a
FAS 11 Provisions and Reserves
FAS 12 General Presentation and Disclosure in the Financial
Statements of Islamic Insurance Companies
FAS 13 Disclosure of Bases for Determining and Allocating Surplus
or Deficit in Islamic Insurance Companies
FAS 14 Investment Funds
….THE 25 ACCOUNTING
STANDARDS….
FAS 15 Provisions and Reserves in Islamic Insurance
Companies
FAS 16 Foreign Currency Transactions and Foreign
Operations
FAS 17 Investments
FAS 18 Islamic Financial Services Offered by
Conventional Financial Institutions
FAS 19 Contributions in Islamic Insurance Companies
FAS 20 Deferred Payment Sale
FAS 21 Disclosure on Transfer of Assets
FAS 22 Segment Reporting
FAS 23 Consolidation (new)
5 AUDITING STANDARDS
1. Objective and principles of auditing.

2. The Auditor’s Report.
3. Terms of Audit Engagement.
4. Testing for Compliance with Shari’a Rules and Principles by
an External Auditor.
5. The Auditor’s Responsibility to Consider Fraud and Error in an
Audit of Financial Statements.
ISLAMIC FINANCIAL SERVICES
BOARD (IFSB)
• GN-1: Guidance Note In Connection with the Capital
Adequacy Standard: Recognition of Ratings by External
Credit Assessment Institutions (ECAIs) on Shari`ah-
Compliant Financial Instruments
• GN-2: Guidance Note In Connection With The Risk
Management And Capital Adequacy Standards: Commodity
Murâbahah Transactions
• GN-3: Guidance Note On The Practice Of Smoothing The
Profits Payout To Investment Account Holders
.…IFSB….
• IFSB-1: Guiding Principles of Risk Management for

Institutions (other than Insurance Institutions) offering only
Islamic Financial Services (IIFS)
• IFSB-2: Capital Adequacy Standard for Institutions (other than
Insurance Institutions) offering only Islamic Financial Services
(IIFS)
• IFSB-3: Guiding Principles on Corporate Governance for
Institutions Offering Only Islamic Financial Services
(Excluding Islamic Insurance (Takaful) Institutions and Islamic
Mutual Funds
.…IFSB….
• IFSB-4: Disclosures to Promote Transparency and Market

Discipline for Institutions offering Islamic Financial Services
(excluding Islamic Insurance (Takaful) Institutions and Islamic
Mutual Funds)
• IFSB-5: Guidance on Key Elements in the Supervisory Review
Process of Institutions offering Islamic Financial Services
(excluding Islamic Insurance (Takaful) Institutions and Islamic
Mutual Funds)
• IFSB-6: Guiding Principles on Governance for Islamic
Collective Investment Schemes
.…IFSB….
• IFSB-7: Capital Adequacy Requirements for Sukuk,

Securitisations and Real Estate investment
• IFSB-8: Guiding Principles on Governance For Takaful
(Islamic Insurance) Undertakings
• IFSB-9: Guiding Principles on Conduct Of Business For
Institutions Offering Islamic Financial Services
• IFSB-10: Guiding Principles On Shariah Governance Systems
For Institutions Offering Islamic Financial Services
• IFSB-11: Standard On Solvency Requirements For Takâful
(Islamic Insurance) Undertakings
FINANCIAL
STATEMENT
OBJECTIVES OF FINANCIAL
STATEMENTS
Conventional Islamic
Income Economic Fulfillment of
statement performance Amanah
Balance sheet Financial position Financial trust and
obligation
Cash flow Cash position Cash entrusted
Equity Wealth ownership Wealth entrusted
statement
FINANCIAL STATEMENT
• They can be summarized to 7 sets of reports:-
1. Income Statement
2. Statement of Financial Position (Balance Sheet)
3. Statement of Changes in Shareholders’ Equity
4. Cash Flow Statement
5. Statement in Changes in Restricted Investments and their Equivalent
6. Statement of Sources and Uses of Zakat and Charity Fund
7. Statement of Sources and Uses of Qard Fund
• While the first 4 reports seemed the same as conventional banking, presentations are
rather different mainly because of certain distinct definitions of items within Islamic
banking environment. The last 3 reports are unique to Islamic banking.
MAJOR USER GROUP
Given the many user groups, reports within the financial statement
of an Islamic bank need to be broad enough to address the different
requirements of these groups.
Other
depositors
Others who
transact Holders of
business investment
with the account
Islamic bank
Major users of
an Islamic
bank’s
Current financial
and saving report
Equity
accounts holders
holders
Zakat Regulator
agency agencies
KEY
DIFFERENCES
BALANCE SHEET
 In conventional accounting, the balance sheet has these few components,
namely assets, liabilities and owners’ equity. In Islamic banking, there is one
additional component called “equity of unrestricted investment account
holders”.
Asset Liabilities
Equity of Balance Sheet Owners

unrestricted Components
investment Equity
account holders
DEFINITIONS OF ASSETS &
LIABILITIES
• Assets: • Liabilities
In conventional banking, an A present obligation to
asset is defined as an item transfer assets, extend the use
with future economic benefit of an asset or provide services
attached to it regardless to another party in the future
whether there is legal control as a result of past transaction
by the reporting bank. For or events.
Islamic banking, however, an
item can be taken as an asset
only when the Islamic bank
has legal right to hold, use or
dispose of the item.
STATEMENT OF FINANCIAL
POSITION
ISLAMIC BANK
Statement of Consolidated Financial Position
Asset As at DecLiabilities
31, 2010
Cash & cash equivalent Current & Saving Accounts
Sales receivables: (Al Wadiah)
Murabahah Salam payable
Salam Istisna payable
Istisna’ Proposed dividends
Investments: Other liabilities
Mudarabah Equity of unrestricted investment
Musyarakah accounts
Ijarah
Minority Interest
Ijarah Muntahia Bitamleek
Owners equity
Fixed assets Paid-up capital
Other assets Reserves
Retained earnings
BALANCE SHEET
(ILLUSTRATION)
..cont...BALANCE SHEET (ILLUSTRATION)
DEFINITION OF EQUITY & INVESTMENT
DEPOSITS
• Owner equity:
The net assets of residual equity after deducting liabilities, equity
of unrestricted investment account holders and their equivalent
and prohibited earnings.
•Unrestricted investment deposits and their equivalent are funds

received by IBs which the bank has right to use and invest the
fund without restrictions.
•Restricted investment deposits and their equivalents are funds

restricted by purpose & commingling of funds.
INVESTMENT ACCOUNT
Types of
Investment
Account
Mudaraba Mudaraba
h h
Muqayyad Mutlaqah
ah (Unrestricte
(Restricted d
investment investment
account) account)
Reported as
Off balance Equity of
sheet item Unrestricte
d Account
Holders
STATEMENT OF CHANGES IN EQUITY
(ILLUSTRATION)
..cont...STATEMENT OF CHANGES IN EQUITY
(ILLUSTRATION)
Statement of Changes in Restricted Investments and Their Equivalent
• This is the statement to report the use of Mudarabah Muqayyadah investments
whereby the bank is to undertake to use the funds for specific investments. This pool
of fund must be separated from other funds as the returns from this fund will be shared
among this particular group of investors.
Statement of Sources and Uses of Zakat and Charity Fund

• This is required only when the bank established a zakat and charity fund whereby the
bank acts as a fiduciary of that fund. The bank is responsible for collection and
distribution of all or part of zakat and charity funds.
Statement of Sources of Funds in the Qard fund

• The IBs would also typically be involved in achieving its social goals by providing
interest-free benevolent loans to its customer base. Disclosure of the extent of
reporting on the source of these funds, their uses and balance must be provided.
NOTES TO FINANCIAL
• Structure
STATEMENT
• Presentation of Accounting Policies
• Additional Disclosures in FS
• Unusual Supervisory Restrictions
• Shariah Advisor / Board & Zakat Obligations
• Prohibited Earnings & Expenditure
• Concentrations of Asset Risks
• Concentration & Distribution of Investment Accounts
• Distribution of Assets
• Commitments & Contingencies
• Changes in Accounting Estimates, Errors & Accounting Policies
• Profit Distribution Policy
• Related Party Disclosures
• Specific Investment Accounts
GP8-i
GP8-i
Guidelines on the Specimen Reports and Financial Statements for Licensed Islamic
Banks (GP8-i)
• The Guidelines on the Specimen Reports and Financial Statements for Licensed
Islamic Banks or GP8-i was issued to the Islamic banks (IBs) in August 2003. It sets
out the minimum requirements for the presentation and disclosure of reports and
financial statements of IBs. The GP8-i is to be adopted by the IBs for annual accounts
commencing 2004.
The objective of the GP8-i is to ;

• provide the basis for presentation and disclosure of reports and financial statements of
the IBs.
• aimed at ensuring consistency and comparability of the reports and financial
statements amongst the IBs in complying with the provisions of the Islamic Banking
Act 1983, Companies Act 1965, Shariah requirements and other Bank Negara
Malaysia guidelines.
SALIENT FEATURES OF GP8-i
The salient features of the GP8-i, amongst others, are as follows:
 a) Performance Overview and Statement of Corporate Governance

In promoting good corporate governance, IBs are required to report their performance overview
and corporate governance practices. The performance overview requires the IBs to disclose their
review on performance, measures, business plans and strategies, whilst the statement of corporate
governance requires IBs, among others, to disclose the composition and responsibilities of the
Board, internal audit and control activities and risk management strategies and policies. These
report requirements are important in providing additional information to users in evaluating the
performance and conduct of an IB.
 b) Disclosure of Shariah Advisory Board/ Committee and Zakat Obligations

The Shariah Advisory Board or Committee plays an important role in monitoring the compliance
of Islamic banking activities with the Shariah requirements. Given its importance, the IBs are
required to disclose the functions and duties of their Shariah Advisory Board or Committee in
monitoring the activities pertaining to Shariah matters under the Directors’ Report. With respect to
the zakat obligations disclosure, IBs are required to disclose the responsibility towards payment
ofzakat either on the business or shareholders or on behalf of depositors.
..cont...SALIENT FEATURES OF GP8-i
 c) Report of the Shariah Advisory Board/ Committee
The IBs are required to report the conformity of the IB’s operations with the
Shariah principles under the Report of the Shariah Advisory
Board/Committee. The Report, which is akin to the Auditors’ Report, will
enhance the credibility of the IB’s operation in complying with the Shariah
principles.
 d) Profit Equalisation Reserves (PER)

PER is a mechanism introduced in the Framework of the Rate of Return to
stabilise the rate of return to depositors. Disclosure of PER would reflect the
capability of the IBs in managing the level of profit distribution to the
Mudharabah depositors. The IBs are required to disclose their policy on PER
as well as its movement (provision and write-back) during the financial year.
SUBMISSION REQUIREMENTS
Annual Financial Reports
 Reporting institutions shall submit the audited financial statements to Jabatan Penyeliaan
Konglomerat Kewangan or Jabatan Penyeliaan Perbankan, Bank Negara Malaysia, as
applicable, within 3 months after the close of each financial year. Unless otherwise notified by
the Bank in writing, reporting institutions shall not publish or lay the audited financial
statements at its general meeting.
 In the submission of the annual financial statements, reporting institutions shall attach the
following supporting schedules:
(i) management letter prepared by the external auditors;
(ii) (draft) annual financial reports of the subsidiaries that are major contributors to the group’s
profits, if applicable;
(iii) analysis, both in tabular and narrative form, on the overall assessment of the financial
performance. The analysis of the performance, for current and preceding year, of each of the
institution in the group, if applicable, at a minimum, shall include the following:
(a) total assets (in RM and % of group);
(b) profit/(loss) before tax (in RM and % of group);
(c) profit/(loss) after tax (in RM and % of group);
(d) dividends (if any);
(e) ratio of profit/(loss) before tax to average shareholders’ funds
(f) ratio of profit/(loss) before tax to average total assets.
..cont... SUBMISSION REQUIREMENTS
(iv) the amount of individual impairment provisions calculated in accordance with the parameters
specified of the Guidelines on Classification and Impairment Provisions for Loans/Financing
(v) any other supplementary information as the Bank may specify.
• Reporting institution shall include a note in the Directors' Report in the annual financial
statement on compliance with the Bank's expectations on financial reporting, including the
Guidelines on Classification and Impairment Provisions for Loans/Financing.
SHARIAH
COMMITTE
E
SHARIAH COMMITTEE’S REPORT
• Bank Negara Malaysia through its “Garis Panduan 8 –i" (GP8-i)
had required the Shariah committee to produce a Shariah
committee report expressing their opinion on the Islamic Bank’s
compliance with Shariah. Currently the minimum requirement of
the report is shown in Appendix I. The current Shariah Committee
report for Islamic banking in Malaysia had been issued in
compliance with the minimum requirement as been outlined by
Bank Negara Malaysia through the GP8-i. This is evidence as been
observed in their respective annual report.
DUTIES AND RESPONSIBILITIES
All Shariah Committee members are expected to participate and engage

themselves actively in deliberating Shariah issues put before them. The main
duties and responsibilities of the Shariah Committee are as follows:
(a) To advise the Board on Shariah matters in its business operation

(b) To endorse Shariah Compliance Manuals
(c) To endorse and validate relevant documentations
(d) To assist related parties on Shariah matters for advice upon request
(e) To advise on matters to be referred to the SAC
(f) To provide written Shariah opinion
(g) To assist the SAC on reference for advice
SHARIAH COMMITTEE’S REPORT (ILLUSTRATION)
APPENDIX i: Shariah Review Report as Outlined in GP8-i

CHAPTER 9
Portfolio Management
Financial Intermediation Role of Islamic Banks
● The key element of financial intermediation and
banking activities are based on mudharabah
contracts
● Conceptually both funds mobilisation and funds
utilisation are on the same basis of profit-sharing
among the depositors, the bank, and the
entrepreneur
● In practice, funds are mainly applied by means of
commodities and asset financing instruments that
avoid interest but are not profit-sharing, such as
murabahah, salam, istisna’, and ijarah
Financial Portfolio - Defined
Introduction
· In finance, a portfolio is a collection of investments

held by an institution or a private individual.
· In building up an investment portfolio a financial
institution will typically conduct its own investment
analysis, whilst a private individual may make use of
the services of a financial advisor or a financial
institution which offers portfolio management
services.
Financial Portfolio - Defined
Introduction (contd.)
· Holding a portfolio is part of an investment and risk-

limiting strategy called diversification.
· By owning several assets, certain types of risk (in
particular specific risk) can be reduced.
· The assets in the portfolio could include stocks,
bonds, options, warrants, gold certificates, real
estate, futures contracts, production facilities, or any
other item that is expected to retain its value.
Portfolio Management
· Portfolio management involves deciding what assets to

include in the portfolio, given the goals of the portfolio owner
and changing economic conditions.
· Selection involves deciding what assets to purchase, how
many to purchase, when to purchase them, and what assets
to divest.
· These decisions always involve some sort of performance
measurement, most typically expected return on the portfolio,
and the risk associated with this return.
Bank’s Usage of Funds
On the asset side, a major portion of a bank’s

investment portfolio consists of allocations
made for:
· Loan, financing and advances

· Placement with other financial institutions
· Investment in securities
Bank Asset Portfolio
Objectives & Rationale
● The objective of a bank’s asset portfolio management
is to reduce the bank’s exposure to credit risk by
managing the asset quality of the bank
● The guiding principle is to diversify asset portfolio mix
and avoid any undue concentration of credit risks
● The resultant objective is to minimise poor asset
quality due to imprudent lending, risk concentrations
and other judgemental errors that could impact the
soundness of the bank
Bank Asset Portfolio
Concentration Policies
In diversifying its asset portfolio mix, a bank may set the
following concentration policies:
● Single Customer Limit and Lending Caps
● Economic Sector Focus, Sectoral Caps and Hurdle Limits
● Country Limits
● Bank Limits
● Counterparty Limits
Single Customer Limit & Lending Caps
Main Considerations
● Any undue concentration of credit risk in a group of
borrowers exposes a bank and makes it vulnerable
to the financial health and performance of the
institution.
● In mitigating this exposure, a bank may set certain
credit limits to single customers in order to manage
lending to any specific groups of related borrowers.
Statutory Limit
● Under BNM/GP5, the central bank prohibits commercial
banks from granting loans in excess of 30% of each
bank’s capital funds to a single customer.
● GP5 also defines a large loan as an exposure to any
single customer that reaches 15% of the bank’s capital
funds.
● In addition, a Large Loan Limit prohibits the commercial
banks from granting large loans whose total exceeds
50% of the bank’s total lending.
Internal Limit
● Internally, a bank may set a conservative internal Single
Customer Limit , say, at 20% of capital fund, instead of
30%.
● In practice, there could be instances whereby the limits

may be breached but this can only be possible with the
endorsement of the bank’s higher approving authority
such as the Credit Committee or the Board.
Lending Caps
● Apart from the overall, say, 20% limit set against capital
funds, the bank may also set a separate lending cap on
selected borrower groups depending on the credit
worthiness of the groups concerned.
● On a regular basis, a Group Exposure Notice need to be
prepared for each customer group, focusing on the size
of aggregate exposures, the credit risks associated with
such large exposures, the profitability of the overall
relationship, and whether the risk/reward trade-off
justifies it.
Economic Sector Focus & Sectoral Caps
Strategic emphasis
● To avoid being exposed to any particular economic

sector, a bank may seek to diversify its credit risks
by spreading its portfolio across different economic
activities, e.g.
● in manufacturing sector
● in construction sector
● in general commerce
Economic Sector Focus & Sectoral Caps
Sectoral Caps and Hurdle Limits
Economic Sectors Caps and Limits
● Manufacturing Sector 30% of Total Loans
● Real Estate Sector 7.5% of Total Loans
● Construction Sector 7.5% of Total Loans
● Housing Sector 20% of Total Loans
● Telecommunications Sector RM 1.5 billion
● Oil and Gas RM 3.0 billion
Country Limits
Main Considerations
● To establish country ceilings on the amount of cross-
border risk that is deemed acceptable to the bank
● Each country ceiling must be carefully reviewed on a
periodic basis in relation to the bank’s capital and
the respective lending environment
Country Limits
Example
Country Total Limit
● China USD 500 million
● Cambodia USD 50 million
● Vietnam USD 230 million
● Myanmar USD 25 million
● Indonesia USD 250 million
● Philippines USD 250 million
Bank Limits
Main Considerations
● Limits can be set for risk exposures to banks and
other financial institutions as a constituent to the
overall country limit for that country concerned
● An overall limit is set for each financial institution as

the bank’s maximum total global exposure
Bank Limits
Allocation of Limits
The limits are then allocated towards various types of
transactions as follows:
● Ringgit Money Market Placements
● Overdraft Ringgit Account (maintained in the bank)
● Foreign Currency Placements
● Foreign Exchange
● Direct Risk (in respect of L/C Negotiations)
● Indirect Risk (in respect of L/C Confirmations)
● Purchase of Securities and other Financial Assets
Counterparty Limits
Main Considerations
· With the development of financial derivatives market,
a bank is not only limited to a particular customer
through its lending activities but also in other forms
when the customer subscribes to the various
derivative arrangements offered by the bank
· In an effort to cater for the bank’s overall exposure to

a particular counterparty, timely reports on the bank’s
exposures on aggregate basis may be needed
Securities Portfolio
The holdings of the securities portfolio of a Bank are recognised

based on the following categories and valuation methods:
● Securities held-for-trading
● Securities held-to-maturity
● Securities available-for-sale
(a) Securities held-for-trading
Securities are classified as held-for-trading if they are

acquired principally for the purpose of benefiting from
actual or expected short-term price movement or to lock
in arbitrage profits. The securities held-for-trading will be
stated at fair value and any gain or loss arising from a
change in their values and derecognition of these
securities are recognised in the income statements.
(b) Securities held-to-maturity
Securities held-to-maturity are financial assets with fixed or
determinable payments and fixed maturity that the Group
and Bank have the positive intent and ability to hold to
maturity.
Securities held-to-maturity are measured at accreted/
amortised cost based on the effective yield method.
Amortisation of premium, accretion of discount and
impairment as well as gain or loss arising from
derecognition of securities held-to-maturity are recognised
in the income statement.
(c) Securities available-for-sale
· Securities available-for-sale are financial assets that are not

classified as held-for-trading or held-to-maturity.
· The securities available-for-sale are measured at fair value,
or at cost (less impairment losses) if the fair value cannot be
reliably measured.
· The return and cost of the securities available-for-sale are
credited and charged to the income statement using
accreted/ amortised cost based on the effective yield
method.
(c) Securities available-for-sale (contd.)
· Any gain or loss arising from a change in fair value after

applying the accreted/amortised cost method are recognised
directly in equity through the statement of changes in equity,
until the financial asset is sold, collected, disposed of or
impaired, at which time the cumulative gain or loss
previously recognised in equity will be transferred to the
income statement.
· The banking book consists of all banking activities of the

bank, including the taking of various types of deposits,
packaging and transforming them into suitable maturities and
sizes, and extending them to users of funds, making
recoveries, and distributing returns to depositors and
shareholders.
· The trading book consists of the buying and selling of
securities, stocks and other financial instruments to facilitate
trading with or for customers, to earn profit from the
difference between buying and selling prices or to hedge.
· In general, there could be separate trading books in

an institution oriented towards different markets and
instruments with different objectives.
· Normally, demand depositors’ funds are not
expected to be utilised for financing operations in the
trading book except for controlling risks in the
banking book by hedging.
· The distinction between the two books becomes vital
for setting regulatory standards and supervisory
oversight to ensure systemic stability.
· In order to properly assess the risk exposure of

banks, the banking book activities must be clearly
separated from trading book activities.
· We need to make some further observations on the
contents of the two books for Islamic banks.
· The banking book comprises of assets and liabilities
of banks arising primarily from the mobilisation of
deposits by these institutions from savers and the
packaging of these into funds of suitable sizes and
maturities for extending to users.
· The trading book of banks is affected by two

considerations: portfolio diversification to offset
some risks arising on the banking book, and trading
in securities to earn additional income.
· Trading book of conventional banks comprises
transactions in interest, foreign exchange,
commodity and equity-based instruments, most of
these being derivatives.
· The Islamic banks do not deal in interest-based or

derivative instruments.
· Therefore, the trading book of Islamic banks at the
present time is insignificant as compared to
conventional banks and can be ignored safely.
· Therefore, most of our discussion is related to the
banking book requirements.
CHAPTER 10 & 11
ISLAMIC MARKETING
INTRODUCTION
• When we say Islam is not just a religion, it’s a way of life then it
must provide us the guidelines on how to conduct business. A lot
of work has been done on Islamic finance but limited, very
limited work has been done on this topic.
• this is to change as scholars, academics, policy makers,
managers and other practitioners from all around the world are
gathering in Kuala Lumpur, Malaysia for the“1st International
Conference” on Islamic Marketing and Branding, which will be
held on the 29th and 30th November, 2010. Another step in the
right direction is the launch of “Journal of Islamic
Marketing”which aims to lay the foundation of, and advance,
Islamic marketing as a new discipline
DEFINE
• Marketing is the management process that
identifies, anticipates and satisfies
customers requirements profitably
• Marketing is the process of planning and
executing the conception,pricing,promotion
and distribution of ideas, goods and service
to create exchanges satisfy individual and
organizational objective.
Product development
• Permissible
• Promised quality
• Beneficial for health or life
• Trustworthiness
• Beneficial for people
5PS OF MARKETING
• PRODUCT
manufactured should be legalize and its
impact on customer satisfaction should be
positive.
according to islamic values product must
be lawful and not created a flatness of mind in
any form.
• PRICE
islam does not prohibited price control and
• PLACE
the intend of distribution channels should
be to create values and strengthen the
standard of living by providing sharia
compliant satisfactory services
• PROMOTION
purpose of advertising is to inform or
educate the consumer, it is pertinent that the
information dispersed encourage good deeds
• PEOPLE
customer has the right to get accurate
information about the product and is
indicative of the status given to him by islam,
as well as of the predetermined right of his
wealth that he spends in purchasing product
of any company
SELLING IN ISLAMIC
PERSPECTIVE
• The subject matter that is to be sold should
be some value, specific , quantified should
not be harmful for individual as well as for
society and can be capable of
ownership ,can be delivered and must be in
possession of seller at the time of sale
CHALLENGE FACED BY
ISCM
• Riba (interest)
• Ihtikar(hoarding)
• Adulteration
• Sale of defective goods
• Sale of one debt to another
• Sale of nonexistent commodity
• Short measuring
CONCLUSION
• Islam teachings are civilized, create wisdom of
responsibility and accountability in the mind of believers.
Muslim consumer feel comfortable with marketing
practices carried out in shariah compliant perspective,
information about target muslim market will be valuable to
both business as well as muslim in identified the gap
between muslim consumers expectations and current
business practices with respect to islamic marketing. islam
does not bear intervention in the market system by
hoarding , adulteration , and other form of exploitation and
thus such product should not be marketed or sold as well.

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CHAPTER 1

General Overview of Banking

Prepared By: Dr. Nor Hafizah binti Hasan

Banking Capital Market Insurance

Islamic Stock Exchange Derivative Islamic

Deposit Taking Scheduled Institution Non-Scheduled

AQIDAH SHARIAH AKHLAK

Political activities Economic activities Social activities

Banking and financial activities

Contracts of Exchange Charitable contracts

W akalah Q ard hasan

Inan M ufawadah Abdan W ujuh

Sources : BNM Website

December 4, 2023 WB3053 37

Savings account-i Wadiah / Mudharabah

Current account-i Wadiah / Mudharabah

General investment account-i Mudharabah

Special investment account-i Mudharabah

December 4, 2023 WB3053 38

December 4, 2023 WB3053 39

– Al-Wadiah Savers' G.a.n.g

December 4, 2023 WB3053 40

December 4, 2023 WB3053 41

– You can be certain that your money will be in good

December 4, 2023 WB3053 42

– Al-Mudharabah General Investment Account

December 4, 2023 WB3053 43

December 4, 2023 WB3053 44

December 4, 2023 WB3053 45

Cash line facility-i Bai' Bithaman Ajil / Murabahah

Computer financing-i Bai' al-Inah / Murabahah

Education financing-i Bai' Bithaman Ajil / Bai' al-Inah

Hire purchase-i Al-Ijarah Thumma al Bai'

Home / House financing-i Bai' Bithaman Ajil

Land financing-i Bai' Bithaman Ajil

December 4, 2023 WB3053 46

Products / Services Applicable Concepts

Pawn broking-i Ar-Rahnu

Bai' Bithaman Ajil / Bai' al-Inah /

Project financing-i Bai' Bithaman Ajil

Property financing-i Bai' Bithaman Ajil

December 4, 2023 WB3053 47

Products / Services Applicable Concepts

Bai' Bithaman Ajil / Mudharabah /

Shop house financing-i Bai' Bithaman Ajil

Sundry financing-i Bai' Bithaman Ajil

Umrah & visitation financing-i Bai' Bithaman Ajil

Bai' Bithaman Ajil / Mudharabah /

Working capital financing-i Murabahah

December 4, 2023 WB3053 48

December 4, 2023 WB3053 49

December 4, 2023 WB3053 50

December 4, 2023 WB3053 51

December 4, 2023 WB3053 52

December 4, 2023 WB3053 53

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December 4, 2023 WB3053 58

Accepted bills-i Murabahah

Bank guarantee-i Kafalah