DAY-ONE COURSE

PRINCIPLES OF ISLAMIC BANKING 

• What is Islamic Banking?
• What are the principles of Islamic Banking?
• What are the driving principles of Islamic banks?
• The characteristics of an Islamic financial system:-
• Riba
• Risk sharing; profit sharing; loss sharing.
• Time value of money Islamically interpreted.
• Prohibition of Speculation
• ü Sanctity of contract.
• Shariah approved activities.
• The key characteristics of the liabilities of Islamic banks:-
• Current accounts
• Saving accounts
• Investment accounts

•              Restricted investment accounts
•              Unrestricted investment accounts

• Bank capital
• Nature of Islamic Contracts
• Intermediation contracts:-

•          Mudaraba
•          Kifala
•          Amana
•          Takaful
•          Wikala
•          Ju’ala

• Transactional contracts:-

•          Murabaha
•          Bay salam
•          Bay mu’ajal
•          Ijara
•          Istisna
•          Musharaka.

TWO-DAY COURSE

ISLAMIC BANKING PRODUCTS

[The One-Day Course contents are included, plus]

•  Murabaha
•  What is Murabaha?
• What are the characteristics of Murabaha?
• Murabaha terminology.
• What are the applications of Murabaha?
• Practical steps in constructing a Murabaha transaction.
• Bank guarantees with Murabaha.
• Murabaha and the shariah.
• How does Murabaha differs from conventional bank lending?
• What are the risks for Islamic banks providing Murabaha facilities?
• Mudaraba—Tier One and Tier Two
• What is Mudaraba?
• What is Mudaraba Tier One?
• What is Mudaraba Tier Two?
• Mudaraba terminology.
• The Two-Tier Mudaraba System
• What are the similarities and differences between the Two Tiers? Application of Mudaraba.
•  Characteristics associated with Tier-One Mudaraba.
• Unrestricted and Restricted Mudaraba.
• Characteristics associated with Tier-Two Mudaraba.
• Implementation of a Tier-Two Mudaraba.
• Mudaraba case study.
• What is the difference between Tier-Two Mudaraba and conventional lending?
• How does Mudaraba compare with Musharaka?
• What are the risks for Islamic banks providing Mudaraba facilities?
• Musharaka
• what is Musharaka?
• Characteristics of Musharaka
• Musharaka terminology
• Applications of Musharaka
• Structure of a Musharaka contract.
• Term structure of Musharaka:-

•               Permanent Musharaka
•               Implementation of Permanent Musharaka
•               Case-study: profitable Musharika
•               Case-study: loss making Musharaka
•               Diminishing Musharika
•               Implementation of Diminishing Musharaka.
•               Temporary Musharaka

• What are the risks with Musharaka partnership?
• What is the difference between Musharaka and Mudaraba?
• Ijarah and Ijarah-wa-Iktina
• What is Ijarah?
• What is Ijarah-wa-Iktina?
• Ijarah: operational leasing
• Ijara terminology
• Application of Ijarah
• Advantages of Ijara over bank borrowing.
• Characteristics of Ijarah.
• Case study
• Implementation of Ijarah.
• Why is Ijarah-wa-Iktina Shariah compliant?
• What is the difference between Ijarah and Murabaha?
• Istisna and Parallel Istisna.
• What is Istisna?
• What is Parallel Istisna?
• The characteristics of Istisna
• The characteristics of Parallel Istisna.
• Istisna terminology
• Application of Istisna
• Implementation of Istisna and Parallel Istisna.
• Why is Istisna Shariah compliant?
• What are the banking risks associated with Istisna contracts?
• Salam and Parallel salam
• What is Salam?
• What is Parallel Salam?
• The characteristics of Salam?
• The characteristics of Parallel Salam.
• Salam terminology.
• Implementation of Salam and Parallel Salam
• What are the critical limitations of each of these contracts?
• What is the difference between Salam and Murabaha?

THREE-DAY COURSE

ISLAMIC CAPITAL MARKETS

[The Two-Day Course contents are included, plus]

• Shariah Boards
• What are the common Shariah principles underlying all Islamic financial instruments?
• The key questions the Shariah Boards ask
• What are the problems with the fatwas issued  by Shariah Boards?
• Jurisprudence issues affecting Capital Markets.
• Characteristics of key Capital  Market Instruments acceptable to the Shariah Boards.
• Islamic Capital Market Instruments
• The hierarchy of Capital Markets: where do Islamic Products fit?
• Is it halal or haram for Muslims to invest in the stock market?
• Are companies with debt related activities excluded from Islamic investment portfolios?
• What are the Islamic investment purification principles?
• Commodity Morabaha
• Islamic leasing
• Islamic Equity Market Funds
• Real Estate Investment Trusts
• Islamic Hedge Funds
• Islamic Rating Systems
• Islamic Market indices:
• Dow Jones Islamic Market Index (DJIM)
• FTSE Global Islamic Index Series
• Factors affecting innovation in Islamic banking and Capital markets.
• Islamic Securitization
• Securitization for conventional banking products
• Securitization for Islamic banking products
• The driving forces behind securitization
• What are the Shariah requirements for securitization?
• Securitization structures, pass-throughs, Asset backed bonds, pay-throughs.
• Ownership conveyance issues
• Credit enhancement issues.

FOUR-DAY COURSE

SUKUK: ISLAMIC BONDS

[The Three-Day Course contents are included, plus]

• Sukuk: Islamic Bonds
• Sukuk basis
• How do sukuk differ from conventional bonds
• AAOIFI Sukuk Standards
• How have Sukuk evolved?
• Alternative Sukuk Structures
• Sukuk and the private sector
• Rating Sukuk
• Risks associated with Sukuk
• Case studies.

FIVE-DAY COURSE

RISK MANAGEMENT IN ISLAMIC BANKING

[The Four-Day Course contents are included, plus]

• Risk in Islamic banking
• What are the risks faced by Islamic banks which are not faced by conventional banks?
• Business risks:- displaced commercial risk, withdrawal risk, solvency risk
• Governance risks:- fiduciary risk, operational risk, transparency risk.
• Transaction risks:- credit risk, market risk, mark-up risk.
• Treasury risks:- asset and liability management, liquidity risk, hedging risk.
• Systemic risks:- regulatory risk, business environment risk, institutional risk.
• CAMEL ratings for conventional and Islamic banks.
• Asset, Liability and capital Adequacy issues for Islamic banks
• Liquidity management in conventional banks
• Liquidity management in Islamic banks
• Shariah requirements for Islamic Money Market Instruments.
• Liability management in conventional banks
• Liability management in Islamic banks
• Asset management for conventional banks
• Asset management for Islamic banks
• Capital adequacy for conventional banks
• Capital adequacy for Islamic banks
• Islamic Banking Business Model
• What are the implications for Islamic banks using Profit and Loss share [PLS] principles?
• What does the finance literature tell us about debt finance and PLS finance?
• Agency problems, asymmetric risk and moral hazard issues
• Problems associated with with PLS in practice
• Agency theory solution for conventional banks and for Islamic banks.
• Challenges for Islamic Banks
• Lack of uniform regulatory framework
• No single totally Islamic financial center
• Slow pace of innovation
• Accounting issues not resolved
• Inconsistent Shariah rulings
• Corporate governance
• Structure of the Industry
• Personnel and training issues
• Islamic Financial innovation
• Financial innovation for conventional banks
• Financial innovation for Islamic banks
• Barriers to entry within Islamic financial markets
• Stages of financial innovation for Islamic banks
• Which Islamic financial innovations have succeeded and failed?
• Securitization and financial innovation
• What are the pressures of Islamic  financial innovation?
• What are the special factors affecting Islamic financial innovation?
• Financial engineering for Islamic products.
• Applying the Porter Model to Islamic banks.