
Contracts and Deals in Islamic Finance
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Inhalt
- Cover
- Title Page
- Copyright
- Contents
- Foreword
- Preface
- Acknowledgments
- Product Offerings
- Introduction
- Chapter 1 The Islamic Finance Space
- Modern Phase of Islamic Finance
- Chapter 2 Bai al Inah
- Definitions of Bai al Inah
- Bai al Inah Process Flow
- Legal Issues with Bai al Inah
- Bai al Inah as a Financial Product
- Asset Product
- Liability Product
- Transfer of Ownership
- Documentation Involved
- Resolutions on Bai al Inah
- Conclusion
- Chapter 3 Murabahah, Bai Mu'ajjal, and Bai Bithman Ajil
- Murabahah Sale/Credit Sale/Credit
- Enhancements to Murabahah
- Murabahah Working Capital
- Credit-Based Sale/Markup or Riba
- Bonafide Murabahah/True Sale
- Trading House Model
- Financial Services Division of a Manufacturer or Retailer
- Bai Bithman Ajil
- BBA with Inah
- Conclusion
- Chapter 4 Tawarruq
- Issue of Price Fixing
- Scenario 1
- Scenario 2
- Scenario 3
- Transfer of Title
- Payment of Sales Tax
- Three Sales and Tawarruq
- Specialized Trading Platform
- Applications of Tawarruq in Banking Products
- Asset Products
- Commodity Murabahah Liability Product
- Real Economic Activity
- Conclusion
- Chapter 5 Deferred Payment Sale or Credit Sale
- Accounting Entries for Murabahah by Purchase Orderer
- Accounting Entries for a Bai al Inah Contract
- Pricing of Deferred Sales under Murabahah, BBA, Inah, and Tawarruq
- Modes of Payment of Spot Price and Deferred Price
- How Is the Deferred Price Calculated?
- Is Profit Mechanism Fixed or Floating?
- Discounting Receivable of a Murabahah Financing Contract
- Can Collateral Be Taken by the Seller?
- Risk Treatment of Deferred Payment Sales
- Credit Analysis and Credit Risk
- Risk-Weightage Charges and Expected Losses
- Risk Concentration
- Fixed Income Portfolio
- Conclusion
- Chapter 6 Bai Al Wafa
- Financial Assets as Subject of Sale
- Bai Al Wafa and Sale of Equities
- Bai Al Wafa and Sale of Sukuk
- Conclusion
- Chapter 7 Salaam and Istisna: Deferred Delivery Sale
- Salaam
- Accounting Treatment for Salaam Contract
- Can the Buyer Sell the Asset before Delivery to a Third Party?
- Default Scenarios
- Payment of Partial Purchase Price
- Types of Assets
- Istisna
- Accounting Treatment for Istisna
- Conclusion
- Chapter 8 Bai al Sarf
- Basic Rulings on Bai al Sarf
- Conclusion
- Chapter 9 Bai al Dayn
- Purchase Price, Rental Payments, Receivables, and Debt
- Rental Payments Due in an Ijara Contract
- Financial Products
- Sale of Equity
- Conclusion
- Chapter 10 Bai al Urbun
- Conclusion
- Chapter 11 Ijarah and Its Variants
- Normal Ijarah
- Accounting Entries for Ijarah Contract
- Ijarah Muntahiya Bi Tamleek
- Al Ijarah Thumma al Bai (AITAB)
- Sale and Leaseback
- Conclusion
- Chapter 12 Wadiah
- Forms of Wadiah
- Enhancements to Wadiah
- Money Creation
- Conclusion
- Chapter 13 Qard
- Applications of the Contract of Qard
- Qard as a Deposit Instrument
- Recording of Qard
- Conclusion
- Chapter 14 Mudharabah
- Simple Application of Mudharabah
- Perpetual Mudharabah
- Re-Mudharabah
- Restricted Mudharabah and Unrestricted Mudharabah
- Mudharabah as a Deposit
- Mudharabah as a Fund
- Interbank Mudharabah Placements
- Indicative Rate of Return
- Profit Sharing Ratio
- Importance of Disclosure and Accounting Treatments
- Mudharabah as an Asset Product
- Accounting Treatment of Mudharabah Transactions
- Conclusion
- Chapter 15 Musharakah
- Musharakah and Banking
- Mushrakah as Asset Product
- Pooling of Assets in Mushrakah
- Mushrakah Mutanaqisah
- Capital Charge
- Collateral
- Conclusion
- Chapter 16 Hibah
- Forms of Hibah
- Restrictions on Hibah
- Applications of Hibah in Banking
- Hibah Coupled with Ijarah
- Hibah Coupled with Wadiah
- Hibah and Bai al Wafa
- Hibah and Other Contracts of Sale and Exchange
- Enhancements to Hibah
- Hibah and Cost of Fund
- Conclusion
- Chapter 17 Kafalah
- Who Can Be a Guarantor?
- Products Based on Kafalah
- Back-to-Back Guarantees
- Conclusion
- Chapter 18 Wakalah, Hawalah, Ibra, and Rahn
- Wakalah
- Contemporary Application of Wakalah
- Hawalah
- Types of Hawalah
- Modern Use of the Contract of Hawalah
- Issues in Hawalah
- Hawalah and Bai al Dayn
- Ibra
- Disclosure of Ibra
- Rahn
- Can Financial Assets Be Used as a Pledge Item as Well?
- Conclusion
- Chapter 19 Shariah: Sources, Interpretation, and Implementation
- Modern-Day Ijtihad
- Whose Shariah Is It, Anyway?
- Conclusion
- Chapter 20 Islamic Asset Management and Shariah Screening
- Capital Markets
- IPO Stage
- Market Integrity
- Market Regulation
- Valuations
- Zero Sum Game
- The Role of Capital Markets in the Sphere of Islamic Finance
- Farmer Sukuk or Equity Notes
- Conclusion
- Chapter 21 Pricing, Income Distribution, and Risk Sharing in Islamic Banks
- Pricing of Islamic Financial Products
- Price versus Shariah
- Benchmark for Pricing
- Criticism on Pricing Models
- Profit Equalization Reserve
- Income Distribution
- Risk Sharing in Islamic Banks
- Conclusion
- Chapter 22 Sukuk and Rights of Sukuk Holders
- Rights of Lenders in Debt Financing
- Rights of Equity Holders
- Rights of Bondholders
- Use of Subsidiary Companies and Special-Purpose Vehicles
- How Sukuk Financing Could Work?
- Sale and Leaseback
- The Role of the SPV
- Other Sukuk Structures
- Istisna Sukuk
- Simple Sukuk
- Vanilla Sukuk
- Vanilla Sukuk with Toppings
- Vanilla Sukuk with Extra Toppings
- Sovereign Sukuk
- Conclusion
- Chapter 23 Risk Management for Islamic Banks
- Credit Risk
- Capital Adequacy
- Capital Adequacy Ratio
- Implications of CAR
- Risk Weightages
- Components of Risk Weightage Calculations
- Calculation of Risk Weightage
- Balance Sheet Analysis
- Credit Risk Mitigation
- Market Risk
- Scenario 1
- Scenario 2
- Scenario 3
- Liquidity Risk
- Profit-Sharing Investment Account
- Conclusion
- References
- Chapter 24 Asset/Liability Management for Islamic Banks
- Gap Limit
- Spot Rates and Forward Rates
- Funding Scenarios
- Short-Term and Long-Term Rates
- Time Value of Money
- Conclusion
- Chapter 25 Takaful
- Contract of Agency
- Shariah Issues with Insurance
- Contract of Tabarru
- Product Menu
- General Takaful
- Automobile Takaful Plans
- Fire Takaful Plans
- Medical Takaful Plans
- Personal Accident Takaful Plans
- Personal Takaful Plans and Commercial Takaful Plans
- Liability Takaful Plans
- General Takaful Business Model
- Concepts Related to Takaful
- Financial Loss and Permissible Interest
- Multiple Plans
- No Loss Bonus
- Deductibles
- The Rights of the Fund over the Participant and the Rights of the Participant over the Fund
- Acts of God
- Calamities
- Frequency and Severity
- Pricing General Takaful Plans
- Measuring and Pricing Risk
- Risk Contribution
- Importance of Data
- Observations of General Takaful
- Family Takaful
- Family Takaful Process Flows
- Basic Accounting Entries for Takaful
- Takaful Operator Models
- Wakalah Model
- Modified Wakalah Model or Wakalah Mudharbah Model
- Distribution of Underwriting Surplus
- Conclusion
- Chapter 26 Pricing of Takaful Policies and Retakaful
- Case Study 1: Corporate Medical Takaful Plan under General Takaful
- Case Study 2: Corporate Medical Takaful Plan under General Takaful
- Method A
- Method B
- Case Study 3: Corporate Family Takaful Plan
- Detailed Mortality Table for Life Takaful
- Mortality Tables and Probability Calculations
- Risk Profiling
- Conclusion
- Afterword
- About the Authors
- Bibliography
- Index
- EULA
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