For this to successfully take place, investment opportunities and products must increasingly be structured in a way that stands up to scrutiny from Shariah advisory boards. This opens up a huge new challenge for those involved in structuring and marketing such instruments, whether they are retail, corporate, capital raising or investment products

South Asian countries, most notably Pakistan and India, are also now well-positioned to benefit from the growth of Islamic finance, with governments, issuers and investors becoming more aware of opportunities. So, what is Islamic finance and how is it different from conventional finance? What does it mean to make a financial product Shariah compliant? What needs to be done to ensure product offerings can be made attractive to and compliant with the requirements of the new breed of Shariah-aware investors and market participants?

The program, led by Islamic banking specialist Muhammad Ikram Thowfeek, former head of corporate strategy at Al safa Islamic Banking, Commercial Bank of Qatar will provide the answers to the questions above and will enable you to understand the major challenges facing Islamic finance in Asia and globally. In three days, we will show you the opportunities inherent in Islamic finance. At the end of the course you will have a good understanding of the industry as a whole as well as the main products and contracts, including the exciting topic of Sukuk and Islamic securitization

WHO SHOULD ATTEND

This is a comprehensive program designed to give delegates an all-round understanding of the most important and widely offered Islamic financial products. It will benefit professionals already involved in Islamic finance, as well as those new to the market. This includes financiers, bankers (from Islamic banks as well as those operating under Islamic windows), and end investors. The course is specifically targeted at:

• Islamic bankers
• Investment bankers
• Corporate and commercial bankers
• Private bankers
• Corporate treasurers
• Analysts
• Asset managers
• Consultants
• Regulators and government representatives
• Auditors
• Risk managers

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Course Objectives

• Assess what Islamic finance is and how it is different
• Examine Shariah and how it affects product offerings
• Discuss regulation of Islamic finance & banking
• Identify the opportunities and challenges facing Islamic finance
• Understand Sukuk & Islamic capital markets
• Assess how your organization can offer Islamic financial services

COURSE AGENDA

Day One

Introduction and Welcome

Introduction: Islamic Finance

• What it was? Background and history of Islamic finance
• What it is today? The current market
• Hurdles and threats: challenges facing the Islamic finance industry as a whole
• Importance and significance of Shariah
• Issues challenges and opportunities
• Why should my institution be offering Islamic banking products?

Key principles of Islamic Economics and Finance

• Riba, gharar, possession and ownership
• Other key concepts
• Constrains of the above in relation to product structuring

Islamic and Conventional Finance Compared

• Regulatory framework: similarities and differences
• Organization and management structure considerations
• Key principles that distinguish Islamic finance from conventional finance
• Comparing interest bearing to profit and loss sharing
• Sources and application of funds for each

Shariah Board Mandate

• What are Shariah advisory boards and why are they necessary?
• Importance of the Shariah audit and control function
• Why Shariah opinions differ and the impact of this?

Roles of Important Islamic Finance Regulators

Roles and mandates of the following organizations:

• Islamic Financial Services Board (IFSB)
• International Islamic Financial Market (IIFM)
• Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI)
• International Islamic Rating Agency (IIRA)

Day Two

Product and Services:
This section aims to introduce delegates to a wide spectrum of Islamic financial products. Focus will be on product structure, diagramming the transaction, risk management as well as further managerial and practical issues involved with establishing and offering each product. Product development and innovation issues are also covered in detail.

Introduction to Structuring Islamic Financial Products

• Islamic theory of contracts
• The rules of structuring Islamic financial products
• Liability products: current, savings and investments

• Examining the key characteristics, structure and uses of the following sales and investment based Islamic products:
  • Murabahah/Bai’ Bithaman Ajil (BBA)
  • Ijarah
  • Musharakah
  • Mudarabah
  • Salam
  • Istisna
  • Wakala

• Trade Finance Products: letters of Credit, letters of guarantee

Key Accounting and Disclosure Requirements for Islamic Financial Products

• Reviewing AAOIFI standards for the above financial contracts
• Other key accounting considerations for Islamic financial products

Important Legal and Regulatory Issues for Islamic Banking

• Examining documentation for Islamic financial products
• Points of contention between Islamic products and conventional financial institutions
• The importance of external counsel and Shariah advisors

An Introduction to Risk Management for Islamic Banking

• Where does Basel II fit for Islamic banks?

CASE STUDY: Profit distribution methodology

Structuring Exercise

Islamic Financial Product Innovation and Development

• Assessing latest trends and developments in Islamic financial products
• Market acceptance of new products
• The positive and the negative impact of innovation
• Practical considerations for rolling out new products

Day Three

This session will introduce the thriving Islamic capital markets sector, and in particular the development and structure of Sukuk instruments

Examining Global Islamic Capital Markets and Sukuk Structures

• Overview of the global Islamic capital markets
• What distinguishes an Islamic from the conventional capital market?
• Benefits of Sukuk to all the stakeholders in the Industry
• Types of Sukuk and their salient features
• Islamic Funds versus Sukuk – a quantum leap forward
• Recent development and the future of the global Sukuk market
• Integration - accelerating growth of the global Sukuk market

CASE STUDY: Sukuk Ijarah and Sukuk Musharakah

• The purpose of the Issue
• The structure
• Advantages of going global
• Liquidity management and capital raising through Sukuk
• Q&A

Key Operational Issues of Structuring Islamic Financial Products
The following section will address in detail the key operational, management and logistical issues that must be considered before offering Islamic financial products. The section will be conducted in a consultative fashion through lectures and group discussions, whilst referring continuously to real-life examples.

• Developing business models and strategies
• Identifying target segments and value propositions
• Capital provider and its Shariah compliance
• Understanding important governance issues
• The problems created by co-mingling of funds and its market perception
• Pooling of resources and economics of scale
• Examining product offering in phases
• Distribution model: sales and service delivery
• Bringing conventional practices to the Islamic banking fold
• Establishing key internal controls and segregation between conventional and Islamic dealings in order to build credibility on Islamic offerings
• Independent reporting to regulators
• Importance of separate systems accounting records and operations for Islamic banking

CASE STUDY: Setting up independent Islamic banking operations under a conventional banking umbrella

Course Conclusion and Wrap Up

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EXPERT COURSE DIRECTOR

Muhammad Ikram Thowfeek
Mr. Thowfeek is a chartered accountant by profession and an Islamic banker by practice. To date he has gained a wealth of knowledge and experience through diverse positions held in various organizations in auditing, management consultancy, financial control, strategic planning & budgeting, Islamic banking & finance, retail, commercial and investment banking, Islamic capital and global Sukuk (Islamic Bonds) markets, training and career development.

He is currently the managing director of First Global Group in Sri Lanka, which is a multi-disciplined Islamic financial institution diversified into various specialized activities within the Islamic finance industry. Formerly, the head of corporate strategy at Al Safa Islamic Banking – Commercial Bank of Qatar, mandated to set up the Islamic banking independent branches of the Commercial bank of Qatar. He has held various other senior positions in number of Islamic financial institutions namely: The International Islamic Financial Market – Bahrain, First Finance Company – Qatar, Abu Dhabi Islamic Bank – UAE, First Islamic Investment Bank (Arcapita) – Bahrain, Kuwait Finance House – Kuwait and Ernst & Young – Sri Lanka. He is also considered as a start up specialist involved in setting up banks/financial institutions from scratch.

He is a fellow of the Chartered Institute of Management Accountant (FCMA) – UK, an associate of the Institute of Chartered Accountants (ACA) – Sri Lanka, a member of the Institute of Financial Consultants (MIFC) – USA, a Certified Islamic Banker (CeIB), a member of the Advisory Council of the India-based International Institute of Islamic Business & Finance and also a prominent speaker at various International Islamic Finance Forums held in Kuwait, Bahrain, Dubai, Qatar, Singapore and London.

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DATES & PRICE

Discounts

• Why not take advantage of our incentives and train a number of your team members at once? Register three or more delegates for the same program, and the second and subsequent delegates will receive a 7.5% discount each. Other attractive multi-delegate packages are available —please contact our office for details.

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