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Islamic Banking Management

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ISLAMIC BANKING MANAGEMENT

TABLE OF CONTENTS

BIL 1.0 2.0

CONTENT Islamic Contracts in Islamic Bank INTRODUCTION OF THE SELECTED BANK 2.1 2.2 2.3 Background of Affin Bank Berhad Background of Islamic Affin Bank Berhad Background of RHB Islamic Bank Berhad

PAGE 2 5 5 6 7 8 8 12 15 17 18 47

3.0

LOAN AND FINANCING SERVICES 3.1 3.2 Affin Bank Berhad Services Affin Islamic Bank Berhad Services 3.2.1 3.2.2 3.3 Trade Financings Contracts Financing

RHB Islamic Bank Services

4.0

Comparison of Products between Conventional Bank and Islamic Bank 4.1 Affin Bank Berhad and Affin Islamic Bank Berhad

19 20

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References

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BWBS3043

ISLAMIC BANKING MANAGEMENT

1.0

ISLAMIC CONTRACTS IN ISLAMIC BANK Definition It involves a contract between the seller and its buyer for the sale of goods at a price that includes an agreed profit margin, either a lump sum or percentage of the purchase price. The seller will purchase the goods that requested by buyer and will sell them to buyer with a mark-up.

Contracts Murabahah (cost-plus financing)

Mudharabah (profit sharing)

Contract with one party providing 100 per cent of the capital (Rabb al-Mal) and the one party (the mudharib) providing its expertise to invest the capital and manage the investment project. Profits generated are distributed according to a pre-determined ratio, but it like the capital itself that cannot be guaranteed.

The provider of capital was the losses, who have no control over the management of the project. Musharakah (partnership financing) It involves a partnership between the two parties, who both provide capital towards the financing of new or established projects. Both parties must share the profits on a preagreed ratio, that allowing the managerial skills to be remunerated, with losses that being shared on the basis of equity participant. One or both parties can undertake management…...

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