Date post: | 08-May-2015 |
Category: |
Documents |
Upload: | alhudacibe |
View: | 2,131 times |
Download: | 0 times |
Outline of Presentation
Introduction and Brief Perspective of Islamic Banking Islamic Banking in the Global Prospectus Product Tree of Islamic Agricultural Finance Mode of Financing in Islam ( Musharakah & Modarabah ) Bai ( Buying & Selling ) – Murabaha , Salam, Istisna Takaful – Islamic Insurance Takaful Products for Agricultural Finance Crop Takaful
Presented by Zubair Mughal
CEO – AlHuda : Centre of Islamic Banking & EconomicsRegional Head – Takaful Pakistan Limited.
Industry Progress in Pakistan
6 Full fledge Banks having 228 and 12 Conventional Banks have 103 SAIBBS and 10 Sub Branches till August, 08
Total IB Branches = 341
Year 2001
•Meezan Bank•Al Baraka
•Meezan Bank•Al Baraka•MCB•Alfalah•SCB•Bank AlHabib•Habib AG Zur.•Metropolitan•Bank of Khyber•Soneri Bank
2002 2003
•Meezan Bank•Al Baraka•MCB
•Meezan Bank•Al Baraka•MCB•Alfalah
2 10
2006 - 07
•Meezan Bank (113) •Al Baraka (20) •MCB (8) •Alfalah(32) •SCB (8) •Bank AlHabib(4 ) •HMB(4) •Bank of Khyber(17) •Soneri Bank ( 4) •HBL(1) •Bank Islami(37) •DIB (20) •EGIBL (24) • Dawood(14) •NBP(3) •RBS (3) •Askari(14) •UBL (5)
2004 - 05
1843
Industry Progress in Pakistan
Industry Progress in Pakistan
Industry Progress in Pakistan
City - Wise Breakup
City - Wise Breakup
Industry Progress in Pakistan
Industry Progress in Pakistan
Industry Progress in Pakistan
Industry Progress in Pakistan
Islamic products and services offered by 300+ Financial Institutions around the world
.United States: 20- Al Manzil Financial Services- American Finance House- Failaka Investments- HSBC - Ameen Housing Cooperative
Germany:4- Bank Sepah- Commerz Bank- Deutsche BankSwitzerland: 6
UK: 26- HSBC Amanah Finance - Al Baraka International Ltd- Takafol UK Ltd- The Halal Mutual Investment Company- J Aron & Co Ltd (Goldman Sachs)
Bahrain: 26 - Bahrain Islamic Bank- Al Baraka- ABC Islamic Bank - CitiIslamic Investment Bank
Malaysia: 492 - Pure Islamic Banks (Bank Islam, Bank Muamalat)Rest - conventional banks
Saudi Arabia: 17- Al Rajhi - SAMBA- Saudi Hollandi - Riyadh Bank
UAE: 13- Dubai Islamic Bank- Abu Dhabi Islamic Bank- HSBC Amanah
Qatar: 4- Qatar Islamic Bank- Qatar International Islamic
Kuwait: 9- Kuwait Finance House
Iran: 8
Egypt: 12- Alwatany Bank of Egypt- Egyptian Saudi Finance
Indonesia: 4
Sudan: 9
Pakistan: 21India: 3Bangladesh:9
Turkey: 7- Faisal Finance Institution- Ihlas Finance House
Yemen: 5
International Overview
The size of Islamic Financial Industry has reached US$
300 Bln. and its growing annually @ 15% per anum.
51 countries have Islamic Banking Institutions
27 Muslim countries including Bahrain, UAE, Saudi
Arabia, Malaysia, Brunei and Pakistan
24 non-Muslim countries including USA, UK, Canada,
Switzerland, South Africa and Australia
International Overview
Leading foreign Banks have opened Islamic
Banking windows or subsidiaries such as:
• Standard Chartered Bank
• Citibank
• HSBC
• ABN AMRO
• UBS
International Overview
In Feb 1999, Dow Jones introduced the Dow
Jones Islamic Market Index (DJIM) of 600
companies world wide whose business
complies with Islamic Shariah laws
At present there are more than 105 Islamic
Funds operational through out the world with a
total fund base of over USD 3.50 billion
International Overview
Governments of Bahrain ,Malaysia and now
Pakistan have issued Islamic Bonds (Sukuk) in
order to facilitate Islamic Banks in managing
their liquidity.
Issuance of these bonds has also paved the
way for Shariah compliant Government
borrowings
International Overview
Institutions like Accounting and Auditing Organization
for Islamic Financial Institutions (AAOIFI) and Islamic
Finance Services Board (IFSB) have been formed.
These institutions are playing a key role in setting up
and standardizing Shariah , Financial and Accounting
standards for Islamic Financial Institutions.
Due to these collective efforts Islamic banking is now
recognized by IMF, World Bank and Basel Committee.
PRODUCT TREE OF ISLAMIC AGRI FINANCE
Islamic Modes of Agricultural Finance
Trade Based Modes
Partnership Based Modes
Rental Based Modes
MusharakaMudaraba
MurabahaMusawamaSalamIstisna
IjarahDiminishing Musharaka
Partnership Based Modes of Islamic Agricultural Finance
( Modarabah & Musharakah)
Musharakah
Characteristics All parties share in the capital All parties share profits as well as
losses Profits are distributed as per agreed
ratio Loss is borne by the parties as per
capital ratio Every partner is agent of other
MUSHARAKAH
PARTNER A PARTNER BVENTURERs.1000 Rs.1000
PROFIT Rs. 100
LOSSRs.100
Rs. 60 Rs. 40
Rs. 50 Rs. 50
May be in any agreed ratio
Must be according tocapital ratio
Mudarabah One partner (Rab al Mal) contributes
capital and the other (Mudarib) contributes his skills or services to the venture
Venture may for a fixed period or purpose
Both share profit in pre-agreed ratio Loss is borne by Rab al Mal only,
Mudarib loses his services
MUDARABAH
RABBUL MAL MUDARIBVENTURE
SERVICESCAPITAL
PROFIT
LOSS
40 %60 %
ALL MONETORY LOSS LOSS OF SERVICES
Bai (Buying & Selling)
Trade Base Mode of Islamic Agricultural
Finance
Basic Rules of Bai
Existence of Product/Commodity
Ownership of Product/Commodity
Possession of Product/Commodity Unconditional basis
Product have value/Price.
Basic Rules of Bai Bai on Such product which is permissible in
Islam.
Product Must be Identify, clear with all demanding Qualities.
Not based on any incident, struggle etc
Price must be clearly identified.
Kinds of Bai Bai Musawamah Bai Murabaha Bai Surf Bai Salam Bai Istisna’ Bai Eenna Bai Touliya Bai Wadhia
Takaful (Islamic Insurance )
Introduction
“Takaful” is the Sharia Compliant brand name for the Islamic alternative to conventional insurance. Its based on the principle of Ta’awan or mutual assistance.
Origins of Takaful
In the event of death caused by someone from another tribe, the member of the offender’s tribe would share the “ blood money” (Khoon Baha) to provide for the family of the victim.
Why Insurance ?
Is Some thing wrong with Concept ?
Risk Aversion Assuring others Risk sharing
From the Holly Quran
The need for insurance is shown in the following verse of The Quran.
“ Those of you who die and leave widows should bequeath for their widows a year’s maintenance and residence” (2.240)
From the Hadiths By Anas-bin-Malik, One day Prophet
Muhammad(PBUH) notced a bedouin leaving his Camel without tying it. He asked the bedouin, “Why don’t you tie down your camel”? The Bedouin answered, “ I put my trust in Allah (SWT)”. The Prophet (PBUH) then said,” Tie your camel first, then put your trust in Allah(SWT)” <Tirmidhi>
What wrong with practice ?
The contract between the insurer & the insured is technically wrong from the sharia perspective because of
Interest (Riba) Gharar (Uncertainty)) Gambling (Qamar & Maisir) Risk Transfer Issue
Riba in Insurance
Direct RibaExcess on one side in case of exchange
between the amount of premium.
Indirect RibaThe interest earned on interest based
investments
Gharar
Lexically it means uncertainty and technically it means the uncertainty of the counteract or the subject matter.
InvestmentIncome
Operational Cost of Takaful
/ ReTakaful
Claims &Reserves Surplus
(Balance)
P A R T I C I P A N T S’ T A K A F U L F U N D (P.T.F.)
Mudarib’s Share of PTF’s
Investment Income
Wakalah Fee
InvestmentIncome
Management Expense of
the Company
Profit/Loss
S H A R E H O L D E R S’ F U N D (S.H.F.)
Participant
WAQF
Takaful Operator
Share Holder
Wakala-Waqf Model
Investment by the Company
Different Models of Takaful Pure Mudarabah Model : The
participants and operator enter into modarabah Contract.
Wakalah Model : An Agency Agreement is made between participants and Operators on the basis of Wakalah ( Agency agreements)
Wakalah Based on Waqf Model : The participant's donate the fund and operator charge an agency fee.
General Takaful Types General Takaful – offers all
kinds of non-life risk coverage. It is normally divided into following classes:
Property Takaful Marine Takaful Motor Takaful Miscellaneous Takaful
Types of Family Takaful
Term Life Takaful
Whole Life Takaful
Endowment Takaful
Universal Takaful
Marriage Plan Education Plan
Takaful Operators The number of Takaful operators worldwide is
now estimated at: 152 Takaful companies 9 Retakaful companies In 39 Countries. Average growth rate higher than
conventional insurance companies (around 25%).
Non–Muslims increasingly opting for Takaful products for commercial benefits.
INTRODUCTION OF TAKAFUL PAKISTAN LIMITED
Takaful Pakistan is a joint venture of prestigious local & foreign institutions, including:
Emirates Investment Group (Sharjah). Al-Buhaira National Insurance Co. (U.A.E.) Al Raji Bank - KSA House Building Finance Corporation. Emirates Global Islamic Bank. Arif Habib Securities. Sitara Chemicals.
Large initial paid-up Capital.
INTRODUCTION OF TAKAFUL PAKISTAN LIMITED
Managed by dedicated professionals, committed to
the cause.
Only A rated Takaful Company in Pakistan
ReTakaful arrangements with a consortium of
internationally reputed ReTakaful operators.
Shariah Board comprises of eminent scholars.
BancaTakaful, Crop Takaful and MicroTakaful
products
We intend to be the trend-setter for excellent Clients’
Servicing, Operational bench marks and prudent
Underwriting practices.
Thank You.