Fundamentals of Islamic Banking and Finance

This is a comprehensive programme designed to give delegates an all round understanding of the issues involved in Risk management for Islamic banking.

Course Objective

• Understand the principles of Islamic finance
• Understand Islamic banks: why, how and for what?
• Introduce the Islamic financial products,
• Discuss and contrast Islamic banking with conventional banking
• Understand Islamic finance Application with samples of contracts
• Understand the foundation of Islamic securitization
• Look into the Islamic investment funds and their potentials

The Course Specifically Targets:

• Investment Bankers
• Corporate and Commercial Bankers
• Corporate Financiers
• Private Bankers
• Analysts
• Asset managers
• Risk Management Managers
• Consultants
• Lawyers
• Investment Advisors
• Regulators
• Auditors and compliance professionals

Course Outline

Day 1

• Foundations of Islamic finance
  • Islamic Economics
  • Islamic Economic System:
  • Shari’ah and Islamic Finance
    • Objectives of Shari’ah
    • Scope of Shari’ah
  • Banking practices in the history of the Islamic society
  • Development of contemporary Islamic banks
  • Definition and nature of an Islamic bank
  • Salient features of Islamic banks:
    • Commitment to Shari’ah
    • Commitment to Moral standards in financing
    • Developmental by nature
    • Commodity/service-based financing
  • Comparison and contrast with conventional banks
  • Characteristics of Islamic banking:
    • Comprehensive/universal banking
    • Sources of funds: partners
    • Uses of funds: commodity/serve-based financing
    • Requires exception for traditional banking laws
  • Regulation of Islamic banks:
    • Supervisory authority
    • Shari’ah board (regulatory body)
  • Fiscal Policy in Islamic Framework:: Objectives, Tools
  • Monetary Policy in Islamic Framework:: Objectives, Tools.
  • Islamic re-definition of banking services:
    • Opening current accounts
    • Collecting checks and money transfers
    • Collecting notes, bills and other IOUs
    • Buying and selling stocks for customers
    • Currency exchange
    • Issuance of letters of guarantees
    • Issuance of documentary letters of credit
    • Renting deposit boxes
    • Opening investment deposits
    • Financing operations from the pool of investment funds
  • Conventional banking services not permitted in Islamic banks
    • Discounting of bonds, bills of exchange and other IOUs
    • Intermediation in buying and selling bonds
    • All operations in which interest is part

Day 2

• Finance contracts In Islamic banks
  • For funds mobilization:
    • Musharakah
    • Mudarabah
    • Loan
  • For funds utilization
    • Sale
    • Sharing
    • Leasing
  • Islamic finance contracts
  • Principles of Financial Contracts in Shari’ah
  • Categories of Financial contracts in Shari’ah
  • Currency Transactions and Riba al Fadl
  • Earning Return by ownership, labor and guarantee
  • Islamic Financial intermediation
  • Prohibition of Riba (interest), Gharar, gambling, sale of what you don’t own, etc.
  • Comparison between Islamic financing and interest-based financing
  • Shari’ah-Named Financing Contracts
    • Musharakah:
    • Mudarabah
    • Muzara’ah
    • Deferred-payment sale
    • Salam
    • leasing
  • Characteristics of the Shari’ah-Named Financing
  • Contracts
    • Sharing contracts:
      • Fairness and balance: No Interruption of Sharing
      • Implications of Wakalah
      • Profit per agreement and losses per capital
    • Exchange Financing Contracts
      • Social and contractual justice
      • Moral boundaries
      • Level of Disclosure
    • Lease Contracts
      • Flexibility
      • Amenability to Hybrids
    • One-Side contributory Contracts:
      • Flexibility in Conditions

Day 3

• New Approaches to Islamic financial engineering
• New financing contracts for liquidity management
  • Tawarruq
  • Reversed Murabahah
  • International Inventory Financing
• International reversed Murabahah
  • New financing contracts for corporations
  • Purchase/installment sale
  • BBA (Purchase/lease back)
  • BOT and output/revenue sharing
  • Inventory Murabahah financing
  • Three party Istisna’
• New financing contracts for government
  • Output sharing and BOT
  • Constructions of Schools
  • Build/lease operations

Certification

On completition of the course you will receive a certificate from ASTC Dubai.