The specialist in highly technical, market-driven banking and corporate finance training

Islamic Finance Courses

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IN-HOUSE COURSES

• Islamic Finance – Real Estate: The Halal Way• Islamic Finance – Events of Default: Restructure or

Litigate?• Islamic Finance – Legal problems and their solutions• Islamic Banks – Functions and Governance• Shariah Compliant Investments• Islamic Finance - Introduction• Islamic Retail Banking• Islamic Finance - The Sukuk Revolution• Islamic Finance – Debt financing techniques• Islamic Finance

Corporate Membership Scheme

Our Corporate Membership Schemes are not valid on any courses held on an in-house basis and are in line with our standard Terms & Conditions

If you would like to enquire about one of our Corporate Membership Schemes then please call or email us for more information.

Email: enquiries@rtlimited.co.uk Tel: +44 (0) 20 7387 4484

Our Corporate Membership Scheme gives clients the benefit of discounted course places with absolutely no

restrictions.

Clients pay an annual subscription fee of £595 + VAT to receive 20% discount on all public course and conference

bookings irrespective of the numbers booked.

You Corporate Membership Scheme can be used once payment is received and will be valid for one year.

web: redliffetraining.com email: enquiries@redcliffetraining.co.uk phone: +44 (0)20 7387 4484

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Islamic Finance – Real Estate: The Halal WayIn House

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Course Overview

This one day course will be of enormous value to real estate practitioners who are doing business with the Muslim world or those who want to break-into the Shari’ah-compliant real estate market.

Real estate, especially UK real estate, continues to hold a fascination for many Islamic banks and institutions and high net worth investors.

We take attendees through all aspects of the Shari’ah-compliant market with particular focus on what is permissible and what is not. We also look at commonly employed structuring techniques as well as typical problematic matters that arise in practice and their solutions.

Our objective is to equip attendees with the knowledge they need to know to engage with Islamic real estate practitioners with confidence.

Session 1 ■ Everybody loves real estate

• state of the market• retail sector• commercial sector• what type of property is of interest to

Islamic financiers? ■ What conventional activities are permissible?

• sale & purchase• leasing• mortgaging & foreclosing

■ Can real estate be financed?• characterising “finance”• characterising “real estate” • prohibited assets and activities• prohibited types of money

Session 2 ■ Riba is not allowed, but:

• what is riba?• what alternatives are there to riba?• bai, ijara, shirkah

■ What is the opinion on:• rahn (pledge)• kafalah (guarantee)

■ What about co-investment?• the de minimis rules• segregation• cleansing• typical co-investment structure

■ What about hotels?

CASE STUDY – holiday resort development in the Arab Gulf

Session 3 ■ The evolution of UK retail financing tech-

niques ■ Murabaha (re-sale with mark-up)

• pros and cons ■ Ijara (lease)

• pros and cons ■ Diminishing musharaka (gradual ownership)

• pros and cons ■ Issues that arise, include:

• pricing• insurance• agency

■ Tawarruq (aka “commodity murabaha”) • is it the easy way to finance everything?• is it morally reprehensible?

Session 4 ■ Documenting the deal

• the lawyer’s preparation• legal issues to look out for• getting Shari’ah approval • ensuring Shari’ah compliance

Case study – financing of a leasehold interest in West London

Question & Answer session

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Islamic Finance – Events of Default: restructure or litigate?In House

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Course Overview

In an era where the “selling” process seems to be at the forefront of most minds, very few have stopped to think about what will happen if it all goes wrong. This one day never-before-offered” course in Islamic finance does just that.

It considers the nature of default in an Islamic context, what can be done about it and what actions should be taken or avoided when it happens. It explores the process of reaching amicable solutions and then looks at what will happen if they cannot be reached.

The day concludes with analysis of two major industry defaults – a sukuk product and an Islamic bank – and the practicalities of dealing them.

This course will be of enormous value to financiers working on remedial matters, litigation & dispute resolution lawyers, restructuring and insolvency practitioners everywhere.

Course Content

Session 1 ■ Introduction to default

• what exactly is a default?• different types of default• different types of defaulter • products• institutions• what typically happens upon default?• what is a standstill agreement?

■ Islamic guidance• Qur’an• Sunnah

■ Attitude of Governments• role of central banks, regulators and oth-

er public authorities • to intervene or not to intervene – and

how?• is emergency funding needed• how can it be given in an Islamic context?• “lender of last resort”?

■ Practical realities• workout frameworks• schemes of arrangement • creditor’s committees• keeping “interest” current• Islamic compliance?

■ Future necessities

Session 2 ■ Bankruptcy in Shari’ah

• what principles are invovled?• do people adhere to those principles?• what happens if they do not?

■ Consensual solutions• creditor perspectives

• competing financial, commercial and legal interests

• hedge funds and distressed debt buyers • negotiation techniques

■ Mediation and Arbitration ■ Litigation

• which forum?• cases on governing law• the danger of judicial recharacterisation• priority rankings upon insolvency and

winding-up

Session 3

Case Study – product default: the sukuk that couldn’t fail

We analyse the ramifications of the infamous Dubai World / Nakheel default that occurred in 2009 – the largest ever sukuk to get into difficulty.

Session 4

Case study – institutional default: the first Islamic bank in Chapter 11

We analyse the predicament of Arcapita Bank, a global Islamic bank, which ultimately filed for Chapter 11 bankruptcy protection in 2012 – the first ever Islamic bank to do so.

Question & Answer session

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Islamic Finance – Legal problems and their solutions

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Course Overview

This one day course is primarily aimed at practising lawyers, but may also be of benefit to others who deal with the structuring of transactions and products and/or prepare documents and negotiate them.

First we consider the essence of a business relationship in Shari’ah; how promises are made, received and acted upon.

Next we look at the wider framework in which such relationships are conducted and the hurdles that arise when rules contrary to Islamic requirements are encountered.

The third session focuses on common obstacles lawyers come-up against in practice and how they should try to navigate around these or avoid them altogether.

We end with a thorough examination of the modern-day murabaha contract. We consider its inherent deficiencies and how lawyers have attempted to overcome them.

Attendees will be invited to explain how they would attempt to deal themselves.

Session 1 ■ Islamic contract law

• mu’amalat (Islamic commercial law)• different types of promise• elements for a valid agreement• elements that will make an agreement

void• consequences of sahih (valid), batil (void)

and fasid (voidable)• practical considerations for lawyers when

drafting agreements

Session 2 ■ Governing laws and rules

• Shari’ah versus national law?• the reception of Shari’ah into secular

systems• the Beximco case• the Blom case• the Golden Belt case• the danger of judicial recharacterisation• conflicts with AAOIFI accountancy rules• managing default situations, when theory

and practice collides• priority rankings upon insolvency or wind-

ing-up• practical considerations for lawyers when

giving opinions

Session 3 ■ Common traps for lawyers and how to avoid

them• adversarial legal representation • caveat emptor• avoiding riba • dayn (debt) sales • inah (back-to-back) sales

• hiyal (ruses) • khiyar (options)• is ijara equivalent to lease?• is waqf equivalent to trust?• getting Shari’ah approval, what is in-

volved?• how is Islamic dispute resolution different?• are there alternatives to default interest?

Session 4 ■ The problem with murabaha

Used in more than 90% of Islamic financing transactions, yet fraught with legal difficulties. We will analyse the original intent behind murabaha and how it is used by financiers in the modern era.

We will examine the inherent conflict faced by lawyers who are required to uphold the spirit of Islamic law (which demands that tangible risks exist in all trades) versus a desire to minimise risk (which invariably a lawyer’s professional obligations will demand).

Attendees will be set a series of problems and asked to indicate which are acceptable or otherwise – and why.

• the tradition• the evolution• modern practice• deferred payment• remembering the fundamentals• risk elimination exercise• analysing outcomes

Question & Answer session

In House

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Course Content

Islamic Banks – Functions and GovernanceIn House

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Course Overview

This one day course analyses Islamic banks and other non-bank financial institutions that act according to Islamic principles.

We begin by examining Islamic finance in an institutional context, paying particular regard to their structure and external relationships.

Next we consider the products and services they provide, the accounting treatment of such products and services and the overall social utility of Islamic banks.

After lunch we look at governance issues, both from the perspective of a financial regulator and the Shari’ah (religious law).

The course concludes with two case studies: we examine two Islamic banks operating in London – one a retail bank, the other a wholesale bank – and compare their offerings and performance.

Session 1 ■ Islamic banks in context ■ the theoretical foundation of the institution-

alisation of Islamic finance ■ the historical development of Islamic bank-

ing ■ the core objectives of Islamic banking ■ the conceptual difficulty of banking without

riba ■ business models – the bank model versus

the non-bank model ■ business lines – retail banks versus whole-

sale/investment banks ■ surviving in a non-Islamic environment ■ the attitude of regulators – Muslim and

non-Muslim ■ competing alongside conventional banks ■ liquidity management issues

Session 2 ■ Functions ■ Products and Services

• deposits• trade finance• corporate finance• agriculture• consumer• treasury

■ Balance sheet• asset side• liability side• accounting peculiarities

■ Social utility• economic distinction?• qard (interest free loan)• charity

• zakat (religious tax)

Session 3 ■ Governance ■ Regulation

• capital adequacy• risk management• reporting & disclosure• central bank support

■ Shari’ah oversight• Shari’ah supervisory boards, their role and

purpose • Shari’ah compliance departments and advis-

ers• Shari’ah auditors• the view of English law on Shari’ah

■ Reputation management

Session 4

Case study I – Al Rayan Bank (retail)We chart the fortunes of the UK’s only high street Islamic bank

Case Study II – Gatehouse Bank (wholesale) We chart the fortunes of one of the City of London’s best known Islamic investment banks

Question & Answer session

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Course Content

Shariah Compliant InvestmentsIn House

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Course OverviewIslamic Finance and Islamic Wealth Management are probably the closest the financial markets are ever likely to get to truly moral and ethical banking.

They remain a highly popular alternative to conventional products and are popular with both Muslims and Non-Muslims alike. Based on Islamic and Shariah principles they are mainly concerned with genuine profit and loss sharing with a real risk sharing ethic between banker and client.

Islamic wealth and fund management operates on the same principles as Islamic Banking and is equally popular. However, unlike conventional banking the product range is a lot narrower and although it continues to grow, the opportunities are more limited.

That said, to be a Shariah compliant investment requires compliance with a very strict code of ethics which tends to eliminate the speculative and highly geared opportunities. Accordingly, Islamic investments offer generally safer returns with steady growth and limited downside.

All three qualities make this an attractive proposition which is growing in popularity as an increasing number of offerings enter the market.

Learning Objective:This course considers the merits of Shariah compliant investments, explains how and why they are compliant and how they can be used to build a portfolio for the morally and ethically driven investor.

Teaching Methodologies:Classroom lectures and interactive practical workshop format intended to affirm the learning objectives.

Learning Pre-requisites:None although a basic knowledge of conventional fund management would be helpful.

What is an Islamic Finance ■ Definition – Fatwa ■ Source of funds ■ Use of funds ■ Contractual relationships ■ Profit & loss sharing

The Principles of Islamic finance ■ The prohibition of Riba ■ Real & notional interest ■ Fixed & variable interest ■ Interest as a return ■ Methods of Islamic investment ■ Trade credit & leasing ■ Islamic deposits

Case Study/Exercise

Shariah compliant Investment Vehicles ■ Wakala ■ Mudaraba – Restricted ■ Mudaraba – Unrestricted ■ Musharaka

Case Study/Exercise

Islamic Asset & Fund Management ■ Investors’ Objectives: ■ Capital preservation.

■ Maximise yields. ■ Industry screens ■ Balance sheet screens ■ Haram investments ■ Dealing with non-compliance ■ The role of the sharia scholars ■ Incorporation of Islamic doctrines. ■ Link to Sharia precepts & ethics. ■ Legitimate goods. ■ Moral behaviour & social objectives.

Case Study/Exercise

Islamic Bond Market (Sukuk) ■ What is a Sukuk ■ How do they differ from Bonds or other con-

ventional debt instruments ■ What impact will recent defaults have on glob-

al market ■ Two centres, GCC & Far East – differences in

approach ■ Specific differences

Course Conclusion ■ Summary, Revision, Open Discussion

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Course Content

Islamic Finance - IntroductionIn-House

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Course Overview

Islamic finance in its modern form is barely 30 years old yet it is a rapidly growing part of the financial sector and has survived the recent global banking crisis almost untouched. The size of the market is huge and demand for Islamic services exists wherever there is a significant Muslim community.

It is reckoned that nearly 500 financial institutions in more than 50 countries practice some kind of Islamic finance and the market has been growing at more around 10-15% per annum. Latest estimates place total assets at around US$1 trillion.

The main attraction of Islamic finance is that it offers Shariah compliant banking to its clients and is the closest yet that any banking institution has managed to get to genuinely ethical and moral banking. It is underpinned by pure principles, with integrity at the forefront and a genuine sharing of profit and losses as its credo. This has all been achieved with remarkable speed and the sector’s popularity continues unabated.

This course explains in clear terms the basic principles of this increasingly important sector and shows how these and its products differ from the conventional banking models. It is designed to teach delegates the principles of Islamic Banking and to highlight the differences between Islamic and conventional banking.

It explores the different products and services commonly found in both the GCC and the Islamic market globally and it assesses the relative advantages and disadvantages of each. By the end of the course delegates will have a full understanding of the products and principles involved in Islamic Banking and how they differ from Western banking models.

Session 1: Introduction to Islamic Banking ■ History of Islamic Banking. ■ Basic Principles. ■ Sharia Law ■ The Quran, Sunnah and Hadith ■ Sources of Islamic jurisprudence ■ The role of Islamic Scholars and the Islamic

Board ■ The meaning of Riba, Gharar, Maysir, Haram,

Halal, Fatwa. ■ Waqf & Zakat….. Charitable giving and chari-

table tax.

Session 2: Islamic Law of Contracts ■ Wa’d….. Promise. ■ Muwaada or Mua’hida Agreement….. Bilateral

promise. ■ Aqd’….. Contract. ■ Mudaraba Contract….. Profit Sharing. ■ Musharaka Contract…… Profit & Loss Sharing

contracts. ■ Security Contracts:

• Hawala….. Transfer.• Kafala….. Guarantee.• Rahn….. Mortgage.

■ Wakala….. Agency Contract. ■ Foreign Exchange (SARF).

Exercise: Describe the element of offer and acceptance under Sharia.

Exercise: What is the difference between Mua’hida and Aqd?

Session 3: What is an Islamic Bank ■ Definition - Fatwa ■ Source of funds ■ Use of funds ■ Contractual relationships ■ Profit and loss sharing ■ Banking Services. ■ Other Services. ■ Types of Islamic Bank; wholly Islamic, win-

dows or branches approach

Exercise: We will construct a typical Islamic balance sheet highlighting the key differences, especially the contractual and profit/loss sharing element.

Session 4: Sources of Funds – “Investments” ■ Islamic current accounts ■ Amanah, Wakala, Wadia – what are they? ■ Investment accounts – Mudaraba,

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■ Restricted and Unrestricted Mudaraba ■ Musharaka ■ How are investors rewarded ■ Shareholders funds. ■ Trading & Investments.

Exercise: Although moral hazard probably makes this academic, consider who bears what losses in each of the different sources of Islamic funds

Case study: Explain the main differences between an Islamic bank and a conventional bank

Session 5: Use of funds – Most common products ■ Murabaha, definition, description, exam-

ples, risks, challenges. ■ Ijara as above. ■ Istisn’a ditto ■ Compare each product with their conven-

tional banking counterparts

Exercise: You have a client looking to replace commercial vehicles and not wishing to lay out substantial cash up front, how might this be achieved using Islamic banking techniques.

Session 6: Use of funds – Less common products ■ Mudaraba., definition, description, exam-

ples, risks, challenges ■ Musharaka. As above ■ Salam ditto ■ Islamic mortgages ditto ■ Islamic credit cards ditto ■ Two tier Murabaha ■ Two tier Mudaraba ■ Compare each product with their conven-

tional banking counterparts

Exercise: Why is Musharaka not more popular given that it enshrines Islamic principles completely?

Session 7: Islamic Asset & Fund Management ■ Investors’ Objectives ■ Capital preservation ■ Maximise yields ■ Incorporation of Islamic doctrines ■ Link to Sharia precepts & ethics ■ Legitimate goods

■ Moral behaviour & social objectives

Exercise: Taking into account all of the above, name areas where you feel investment activity is unacceptable or prohibited.

Session 8: Islamic Bond Market (Sukuk) ■ Conventional debt securities:

• Rights not linked to assets of company• Holders do not incur damages & losses of

company• Share in financing through usurious prac-

tices• Term not necessarily same as project• No Sharia constraints

■ Sukuk: • Investment process• Share of assets not right to revenues• Profits & losses• Proof of ownership• Ownership costs• Term matches project• Lack of guarantee• Subject to Sharia rules

Exercise: Using Dubai World as an example, consider how the recent problems might impact this important market.

Session 9: Islamic Insurance (Takaful) ■ What is Takaful ■ How does Takaful work. ■ Re-Takaful ■ Takaful products ■ Takaful models

Exercise: Takaful is a controversial subject amongst some scholars. Why is this?

Exercise: What is the difference between a Mudaraba and Wakala arrangement in a two tier Takaful model?

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Islamic Retail BankingIn House

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Course Overview

Global demand for an ethical form of banking has led to a boom in Islamic banking and it is estimated that some 600 financial institutions in more than 50 countries practice some kind of Islamic finance.

The huge growth in Islamic banking has placed considerable pressure on Shariah scholars who have found themselves having to both consider and rule on a complex mix of ancient and modern banking practices, all in the last 40 years. This incredible growth and the extreme pressure to provide as wide a range of banking products as possible whilst staying within the true principles of Islam has led to some pressures and this is likely to continue as an increasing number of conventional banks offer Islamic services through specialized or separate subsidiaries. This course considers these pressures and the often conflicting aims of providing ever more services whilst staying faithful to Islam.

Learning ObjectiveThis intermediate/advanced course is designed to help delegates consider in some detail the principles of Islamic Banking, the differences between Islamic and conventional retail banking and how modern day pressures can, might and are being reconciled within the Islamic code. It looks at much greater detail at the various Islamic products on offer and considers fully the key issues facing Islamic retail banks today

Who Should AttendAll banking and finance professionals working within an Islamic financial institution and any professionals working in the field who wish to develop their skills and understanding further.

Teaching MethodologiesClassroom lectures and interactive practical workshop format intended to affirm the learning objectives.

Learning Pre-requisitesA basic knowledge of the banking and the financial services sector in both conventional and Islamic retail markets is required. This course is not suitable for complete beginners.

Course Content

Principles & Development of Islamic Finance ■ The Islamic World ■ Islam & Economic development ■ Development & growth of Islamic

finance

The Principles of Islamic finance ■ The prohibition of Riba ■ Real & notional interest ■ Fixed & variable interest ■ Interest as a return ■ Methods of Islamic investment ■ Trade credit & leasing ■ Islamic deposits

Modern Islamic Retail Banking – Brief history ■ History ■ Pilot schemes for Islamic banking ■ The “Islamisation” of retail banking ■ Problems for Islamic retail banks in

Western markets ■ Islamic retail banking in the developing

world

Islamic Law of Contracts ■ Wa’d - Promise. ■ Muwaada or Mua’hida Agreement - Bilateral

promise. ■ Aqd’ -. Contract. ■ Mudaraba Contract - Profit Sharing. ■ Musharaka Contract - Profit & Loss Sharing

contracts. ■ Security Contracts: ■ Wakala - Agency Contract. ■ Foreign Exchange (SARF)

Islam & Takafal ■ Islamic attitudes towards risk ■ Muslim objections to insurance ■ Insurance practice in Islamic states ■ Insurance & Islamic law ■ Permitted forms of insurance

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■ Forward cover & exchange risk

Account and Deposit Gathering (“Invest-ments” under Islam) ■ “Current” Accounts ■ Amanah ■ Wadia ■ Wakala ■ Muduraba - restricted ■ Muduraba – unrestricted ■ Ideal mix

Application of Funds – Detailed examination ■ Mudaraba ■ Murabaha. ■ Musharaka ■ Ijara. ■ Istisn’a ■ Salam.

Islamic Accounting Standards ■ Equities & Investment ■ Insurance ■ Foreign exchange & currency ■ Investment bond market ■ Legal issues ■ Others

Corporate Governance ■ Jurisdiction ■ Conflicts between Sharia law, local law,

international law ■ Differences between Islamic states ■ Which law prevails ■ Basel and world Trade Agreements. ■ Regulatory framework ■ Fairness & suitability. ■ Islamic bank issues:

Islamic Asset & Fund Management ■ Investors’ Objectives:

• Capital preservation.• Maximise yields.• Balance between liquidity & profitability.• Incorporation of Islamic doctrines.• Link to Sharia’a precepts & ethics. • Legitimate goods.• Moral behaviour & social objectives.

Islamic Bond Market (Sukuk) ■ Conventional debt securities: ■ Sukuk:

• Investment process.• Share of assets not right to revenues. • Profits & losses.

• Proof of ownership.• Ownership costs.• Term matches project. • Lack of guarantee. • subject to Sharia’a rules.

Course Conclusion ■ Summary ■ Revision ■ Open discussion

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Course Content

Islamic Finance - The Sukuk Revolution

In - House

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Course Overview

This one day course covers everything the attendee needs to know about sukuk – the Islamic equivalent to a bond (and more) – which has taken the financial world by storm in a space of less than fifteen years.

We cover the subject from both a theoretical and practical perspective, looking at the legal rules underpinning the product (including its structuring) and its actual issuance in the capital markets and all the implications that arise from that. We also take time to consider the numerous controversial aspects and likely future developments.

Our course trainer is a practising lawyer who has managed probably more sovereign sukuk issues in the Gulf region that any other lawyer.

Session 1 - Getting started ■ Origins

• Arabic / Mediterranean ■ Terminology

• is it a product or a process? ■ Standard Definitions

• AAOIFI• Practical

■ Conceptual• key elements• how is sukuk different to conventional

bond? ■ Uses

• fund raising• syndication• sub-participation• securitisation• market making• treasury

■ Historical • participation certificates

■ Market • issuers, who are they? • purchasers, who are they?• other participants?

Session 2 - How it’s done ■ Purposes of fund raising

• sovereigns• corporates• banks

■ Why Sukuk instead of conventional bonds?• religion• reputational• aspirational• cost

■ Sukuk Structures• murabaha (re-sale at a mark-up)• ijara (lease)• shirkah (PLS investment)• wakala (agency)• hybrid

■ AAOIFI view ■ Marketing Spin

• “green” sukuk• “asset light” sukuk

■ Business Realities

• the coveted fatwa

Session 3 - The Issuance Process

CASE STUDY – a sovereign ijara sukuk issued in international markets

■ originator, who should it be? ■ selection of arrangers and their mandate ■ underwriting, different options available ■ indicative pricing ■ benchmarking mid-swaps ■ selection of issuer and considerations involved ■ preparation of the prospectus / offering mem-

orandum ■ preparation of the transactional documents ■ originators authorisation ■ market watching, critical for price and timing ■ establishment of SPV for issuer ■ selection of trustee ■ selection of administrator ■ selection of paying agent ■ due diligence meeting ■ finalisation of documentation ■ fatwa (Shari’ah opinion) ■ capital market authorisations ■ rating agencies ■ roadshow & book building ■ final pricing ■ execution of documents ■ lodging of global certificate ■ drawdown due diligence ■ flow of funds ■ listing on recognised exchange

Session 4 - Problems and criticisms ■ asset backed or asset based? ■ correlation between purchase monies and un-

derlining trades? ■ fixed returns and fixed resale prices? ■ tradability ■ enforcement ■ use of proceeds

Future Prospects

Question & Answer session

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Course Content

Islamic Finance – Debt financing techniquesIn-House

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Course Overview

Debt financing is a controversial subject in Islamic finance as theoretically there are no recognised debt financing instruments in the classical law. Nonetheless, financiers have found Shari’ah-compliant ways to provide debt on a commercial basis and these techniques are explored in this one day course.

We begin by examining the philosophical basis that predicates all Islamic financial activity, and then look closely at purchase and resale, the partial forward contracts and leasing, and conclude by considering other types of situation in which indebtedness can arise.

Session 1 ■ Islamic debt in history and the

modern era• the Shari’ah, mu’amalat and

those who interpret it• Islamic economics and the role of

commercial activity• basic prohibited items and activi-

ties in Islamic finance • understanding riba and its conse-

quences• qard hasan, the “beautiful loan”

Session 2 ■ Sale & Purchase

• bai (sale)• murabaha (re-sale with a mark-

up)• how murabaha has evolved as a

financing concept• tawarruq – aka “commodity mu-

rabaha”• musawamah – how it differs from

murabaha

Session 3 ■ The partial forward contracts ■ Istisna’a

• what is it?

• it’s original purpose and modern day application

■ Bai salam• what is it?• t’s original purpose and modern

day application ■ The use of parallel contracts for Istis-

na’a and Bai salam

Session 4 ■ Leasing

• ijara• ijara – with title transfer (condi-

tional sale or hire purchase?)• how is ijara different to conven-

tional leasing?

CASE STUDY

■ what about Sukuk? ■ is it debt or equity?

Question & Answer session

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Course Content

Islamic Finance

In-House

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Course Overview

Islamic Finance has grown considerably in the last 50 years and some estimates place the amount invested at nearly $2trillion.

The huge growth in Islamic banking has placed considerable pressure on Shariah scholars who have found themselves having to both consider and rule on a complex mix of ancient and modern banking practices. This incredible growth and the extreme pressure to provide as wide a range of banking products as possible whilst staying within the true principles of Islam has led to some pressures and this is likely to continue as an increasing number of conventional banks offer Islamic services through specialized or separate subsidiaries. This course considers these pressures and the often conflicting aims of providing ever more services whilst staying faithful to Islam.

Learning ObjectiveThis course is designed to help delegates consider in some detail the principles of Islamic Banking and Finance, the differences between Islamic and “conventional” finance and how modern day pressures can, might and are being reconciled within the Islamic code. It looks at much greater detail at the various Islamic products on offer and considers fully the key issues facing Islamic finance institutions today

Who Should AttendAll banking and finance professionals working within an Islamic financial institution and any professionals working in the field who wish to develop their skills and understanding further.

Teaching MethodologiesClassroom lectures and interactive practical workshop format intended to affirm the learning objectives.

Learning Pre-requisitesNone

Session 1: Principles & Development of Islamic Finance ■ The Islamic World ■ Islam & Economic development ■ Development & growth of Islamic finance ■ Different sectors

Session 2: The Principles of Islamic finance ■ The prohibition of Riba ■ Real & notional interest ■ Fixed & variable interest ■ Interest as a return ■ Methods of Islamic investment ■ Trade credit & leasing ■ Islamic deposits

Session 3: Modern Islamic Retail Banking

– Brief history ■ History ■ Pilot schemes for Islamic banking ■ The “Islamisation” of retail banking ■ Problems for Islamic retail banks in Western

markets ■ Islamic retail banking in the developing

world

Session 4: Islamic Law of Contracts ■ Wa’d - Promise. ■ Muwaada or Mua’hida Agreement - Bilateral

promise. ■ Aqd’ -. Contract. ■ Mudaraba Contract - Profit Sharing. ■ Musharaka Contract - Profit & Loss Sharing

contracts.

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Islamic FinanceContinued...

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Course Content

■ Security Contracts: ■ Wakala - Agency Contract. ■ Foreign Exchange (SARF)

Session 5: Islam & Takafal ■ Islamic attitudes towards risk ■ Muslim objections to insurance ■ Insurance practice in Islamic states ■ Insurance & Islamic law ■ Permitted forms of insurance ■ Forward cover & exchange risk

Session 6: Account and Deposit Gathering (“Investments” under Islam) ■ “Current” Accounts ■ Amanah ■ Wadia ■ Wakala ■ Muduraba - restricted ■ Muduraba – unrestricted ■ Ideal mix

Session 7: Application of Funds – Detailed examination ■ Mudaraba ■ Murabaha. ■ Musharaka ■ Ijara. ■ Istisn’a ■ Salam.

Session 8: Islamic Accounting Standards ■ Equities & Investment ■ Insurance ■ Foreign exchange & currency ■ Investment bond market ■ Legal issues ■ Others

Session 9: Corporate Governance ■ Jurisdiction ■ Conflicts between Sharia law, local law,

international law ■ Differences between Islamic states ■ Which law prevails ■ Basel and world Trade Agreements. ■ Regulatory framework ■ Fairness & suitability. ■ Islamic bank issues:

Session 10: Islamic Asset & Fund Management ■ Investors’ Objectives:

• Capital preservation.

• Maximise yields.• Balance between liquidity & profitability.• Incorporation of Islamic doctrines.• Link to Sharia’a precepts & ethics. • Legitimate goods.• Moral behaviour & social objectives.

Session 11: Islamic Bond Market (Sukuk) ■ Conventional debt securities: ■ Sukuk:

• Investment process.• Share of assets not right to revenues. • Profits & losses.• Proof of ownership.• Ownership costs.• Term matches project. • Lack of guarantee. • subject to Sharia’a rules.

Session 12: Course Conclusion

■ Summary ■ Revision ■ Open discussion

END

The specialist in highly technical, market-driven banking and corporate finance training

web: redliffetraining.co.uk email: enquiries@redcliffetraining.co.uk phone: +44 (0)20 7387 4484