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The Certificate in Risk Management for Islamic Financial Institutions

Tuesday, May 13th, 2008
Garp are launching “The Certificate in Risk Management for Islamic Financial Institutions”

The Global Association of Risk Professionals and the Banque du Liban recently announced the development of a new program, the Certificate in Risk Management for Islamic Financial Institutions.

The explosive growth in, and increasing sophistication of Islamic financial products has created the need for standards and guidelines for sound risk management approaches analyzing these financial instruments.

The Certificate is expected to be available in 4Q 2008.

This marks an important milestone for Islamic Finance.

Islamic Finance

The holistic approach to life Islam requires of individuals also affects their approach to business and financial activities. The basic tenets of Sharia’a, the part of Islamic Law that covers practices and activities, dictate that investors cannot engage in transactions that are speculative, pay interest or involve contractual uncertainty.

Globalization of the financial markets and increased wealth in Islamic regions have accelerated the trend of Islamic banking and specialized products that are Sharia’a-compliant.

Development of the Certificate program is being overseen by an Advisory Oversight Committee which consists of leading Islamic finance and risk management experts and scholars from around the world:

Name Position Company
Dr. Anthony Saunders Professor of Finance New York University
Dr. Ahmad Jachi First Vice-Governor Banque du Libon
V. Sundararajan Director & Head of Financial Practice Centennial Group
Mahmoud El-Gamal Chair of Islamic Economics, Finance and Management Rice University
Sohail Jaffer Managing Director Premium Select Lux S.A.
Jean-Marc Riegel General Manager Investment Banking & Development Group Qatar Islamic Bank
Anuouar Hassoune Associate Financial Institutions Standard and Poor’s
Noor ur Rahman Abid Managing Partner, Head Middle East Ernest & Young
Prof. Jaap Spronk Vice-Dean, International New Business Development Erasmu University of Rotterdam
Audion de Laromiguiere Director, Corporate Risk Advisory, Middle East Barclays Bank
Dr. Amine Awad Executive Director, Member Higher Banking Council Banque du Liban
Dr. Assem Safieddine CFA Society Chairman CFA Society
Dr. Christopher Donohue Managing Director Global Association of Risk Professionals
Kenneth Abbott Managing Director Morgan Stanley
Robert Scanlon MD, Chief Risk Officer, Wholesale Bank Standard Chartered
Usman Ahmed Deputy CEO, Global Islamic Banking Citibank
Nadir Sarela Director, Risk Management Citibank
Ghassan Chammas   Banque du Liban
Dr. Lina El-Jahel   Tanaka Business School
Fawad Laique Partner,  Financial Services Ernst & Young
William Martin Chief Risk Officer Columbia Management Group, Bank of America
Youssef Nizam   Citibank NA UA
Nabeel Shoaib Global Head HSBC Amanh
Sami Suwailem   Islamic Research and Training Institute
Richard Apostolik President and CEO GARP
Recep Bildik Senior Researcher GARP

The expertise in Islamic Finance offered by the Advisory Oversight Committee’s members combined with GARP’s proficiency in creating globally accepted standards on risk management methodologies will result in a benchmark approach to assessing and measuring the financial risks associated with Sharia’a-compliant financial products.

Who will The Certificate in Risk Management for Islamic Financial Institutions primarily benefit?

The Certificate in Risk Management for Islamic Financial Institutions is being developed for those who are pursuing careers in institutions who deal in Sharia’a-compliant financial products and for those staff members in any financial institution who have a need to understand and incorporate Sharia’a approaches and methodologies into their risk management or business strategies.

The Certificate in Risk Management for Islamic Financial Institutions will be first offered in late 2008. For any further questions please contact Dr. Recep Bildik at Recep.Bildik@garp.com

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Help contribute to the wiki

Saturday, November 3rd, 2007

Have you come across good web links? or information on Islamic Investment.. then let everyone know and share the information here..

Like this faq by HSBC http://www.hsbcamanah.com/1/2/hsbc-amanah/about-islamic-banking/faqs

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Launch of Islamic Investment Organisation WIKI

Wednesday, October 31st, 2007

We’re pleased to announce the launch of the Islamic Investment Organisation WIKI

wiki.islamicinvestment.org

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Introduction to Islamic Investment

Sunday, October 14th, 2007

Islamic investmentIslamic Investment, Islamic Banking otherwise known as Islamic Law compliant Investment or Shariah Compliant Investment is a growing industry.

They estimate over 1 trillion USD dollars in size. There are many banks looking to get into this space, and islamic structured products are at the cutting edge of Shariah Compliance.

This is a general introduction to some of the background terms.


An overview of Islamic Investment

Islamic Investment, Islamic Banking otherwise known as Islamic Law compliant Investment or Shariah Compliant Investment is a growing industry, which is become more and more known in the West and more seriously considered by all the participants in the modern financial world.

There is an estimate that this market will become worth over 1 trillion USD dollars in size over the next 5-10 years, fuelled by the wealth from Oil, property and the resurgence of growth in the Middle East. There are many banks looking to get into this space, and Islamic Structured Products (Structured Products and Retail Structured Products which meet the requirements of Shariah Boards to be passed as Shariah Compliant) are at the cutting edge of Islamic Investment.

This is a general introduction to some of the background terms and concepts, but the important thing to know before we begin, is that there are many paths to the same outcome, and many views on a subject which has been discussed for hundreds if not thousands of years.

Islamic Banking

When banking practices are able to meet the requirements to be compliant with Shariah, or Islamic law, they are said to be Islamic Banking practices. These practices are open to all, and not restricted to Muslim only use.

IIt is worth noting therefore that the participants in Islamic Banking, need not be Muslim.

Shariah Boards / Shariah Investment Boards / Shariah Committee

Because of the complexity of Islamic Law, and the importance for clients to comply, groups of Scholars who are versed in the Law are usually formed into Shariah Boards in order to give advice, guidance and rulings on investments and financial products as to whether they are Shariah Compliant.

Prohibited Concepts

  • Gharar - Uncertainty
  • Maysir - Gambling
  • Riba - Interest

Concepts of Islamic Investment

  • amanah - Trust - trustworthiness, faithfulness and honesty, also in relation to keeping another party’s assets in Trus. It can also include safe custody, deposit taking and safekeeping.
  • Arbun - A deposit at the start of a contract that is non-refundable if the contract is completed during the alloted period
  • Gharar - Uncertainty - not allowed in Islamic Finance - often speculation, gambling, and convential financial derivatives are seen as this.
  • jara - Islamic lease agreement.
  • Ijarah wa iqtinah - a hire and purchase agreement.
  • maysir - gambling - not allowed in Islamic Finance - often speculation, gambling, and convential financial derivatives are seen as this.
  • mudaraba - an Investment partnership, investor (the Rab ul Mal) entrepreneur (the Mudarib). Profits are shared as per the agreement, but any losses of investment are only forthe Rab ul Mal. Also used as Discretionary Asset Management investment.
  • mudarib - entrepreneur or investment manager in a mudarabah agreement
  • murabaha - Purchase and resale
  • usharaka: - a partnership with preagreed profit and loss sharing.
  • riba - Interest - Strictly prohibited - the return of money on money itself.
  • Shariah - Islamic law as in the Quran, and by the Prophet Muhammad
  • Shariah advisor - independent professional Islamic legal scholar
  • Shariah compliant - complies with Shariah Law
  • Sukuk - Asset backed bond
  • Takaful - Islamic “insurance”
  • Tawarruq - Reverse murabahah.

 

Useful Links on Islamic Finance and Islamic Invesment or Islamic Banking are

Islamic Investment

Islamic Investment Products

Islamic Structured Retail Products

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IslamicInvestment.org

Saturday, October 13th, 2007

For news and information on Islamic Investment

This is an independent, non-affiliated site, providing a review and directory of information, articles and events on Islamic Investment.

If you would like to have your information listed, please contact us.

This site is UK based, and UK Law will apply to all users of this site. All site content is (C) and all links listed in no way suggest our recommendation.

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