Professional Documents
Culture Documents
TOPIC
DIFFERENT INVESTMENT MODES OF IBBL
Submitted To
ROKEYA SULTANA Le!tu"e" # Su$e"%i&o" De$."tme/t o0 Bu&i/e&& Admi/i&t".tio/ M./.".t I/te"/.tio/.1 U/i%e"&ity 2MIU3
Submitted By
TA REEN TANUMA
A/ I/te"/&4i$ Re$o"t O/
Submitted To
ROKEYA SULTANA Le!tu"e" # Su$e"%i&o" De$."tme/t o0 A!!ou/ti/7 # Fi/./!e M./.".t I/te"/.tio/.1 U/i%e"&ity 2MIU3
Submitted By
TA REEN TANUMA ID' ()**BBA((+,De$."tme/t o0 A!!ou/ti/7 # Fi/./!e M./.".t I/te"/.tio/.1 U/i%e"&ity 2MIU3
LETTER OF TRANSMITTAL
ROKEYA SULTANA
Lecturer & Supervisor Department of Accounting Manarat International University uls!an, D!a"a#1212 Su$% # Su$mission of report on &Different Investment Mo'es of I((L) Dear Sir *!is is my pleasure to present my interns!ip report on &Different Investment Mo'es of I((L) +!ic! your goo' self assigne' me, I !ave trie' my $est to complete t!e report +it! t!e necessary information an' suggeste' proposals in -uite a concise an' compre!ensive manner as possi$le, I !ope t!at t!e report +ill meet t!e e.pectations,
Sincerely yours
////////
*A01223 *A3UMA
ID% 0411((A00526
Su$e"%i&o"8& Ce"ti0i!.te
*!is is to certify t!at t!e Interns!ip 1eport on &DIFFERENT INVESTMENT MODES OF IBBL) in t!e $ona fi'e recor' at t!e report is 'one $y *a!mina 9arveen as a partial fulfilment of t!e re-uirement of (ac!elor of (usiness A'ministration 7((A8 from t!e Mar"eting Department, Manarat International University,
*!e report !as $een prepare' un'er my gui'ance an' is a recor' of $ona fi'e +or" carrie' out successfully,
ii
De!1.".tio/
I 'o !ere$y solemnly 'eclare t!at t!e +or" presente' in t!is Interns!ip 1eport !as $een carrie' out $y me an' !as not $een previously su$mitte' to any ot!er University : ;ollege: <rgani=ation for an aca'emic -ualification : certificate : 'iploma or 'egree, *!e +or" I !ave presente' 'oes not $reac! any e.isting copyrig!t an' no portion of t!is report is copie' from any +or" 'one earlier for a 'egree or ot!er+ise, I furt!er un'erta"e to in'emnify t!e Department against any loss 'amage arising from $reac! of t!e foregoing o$ligations,
//////////, *a>reen *anuma I'% 0411((A00526 Department of (usiness A'ministration Manarat International University
iii
*!is is to certify t!at *a!mina 9arveen is a regular stu'ent of ((A program of Manarat International University $earing I' 3o% 0041((A00526 !as $een participating in t!e practical interns!ip program at our $ranc! since 14,0?,06 to 26,06,06, S!e !as successfully complete' t!e program +it! great en'eavour an' ent!usiasm, S!e is very muc! punctual an' 'iscipline' to atten' t!e office, I +is! !im all success in all sp!eres of life,
////,,,,,,,,,,,,,,,,,,,,,,,,,,,,, Asstt, @ice 9resi'ent Islami (an" (angla'es! Limite' uls!an ;ircle#1(ranc!, D!a"a,
P"e0.!e
<ne of t!e main o$>ectives of t!e ((A program is to create s"ille' professional for various sectors, *!is program is 'esigne' to meet t!e nee's of eac! stu'ent +!o +ant to 'evelop t!eir career as e.ecutives in t!e fiel' of 'ifferent $usiness areas as +ell as teac!ing an' researc! positions in 'ifferent institutions, (ut perfection 'oes not come only from t!eoretical "no+le'ge, *o reinforce t!e t!eoretical "no+le'ge ac-uire', 9ractical Interns!ip of t!ree mont!s in private $usiness organi=ations, government offices, pu$lic sector corporations, $an"s an' non#$an" financial institutions is to e.pose as in t!e organi=ational +or" situation, Ae are re-uire' to un'ergo t!e program an' prepare a report accor'ing to t!e Instructions of our supervising teac!er, In spite of my limite' "no+le'ge an' e.perience I !ave 'evote' my assigne' >o$ +it! 'ue earnest, If any lac"ing prevails in my report, I !ave no o$>ective to accept it sincerely,
iv
A!6/o:1ed7eme/t
Birst of all, I +oul' li"e to e.press my 'eep gratitu'e to t!e Almig!ty Alla! for fruitfully preparing t!is Interns!ip report, I am t!an"ful to !onoura$le S@9 & Director 7training8 0ana$ M', 1afi-ul Islam, &, Director eneral I(*1A, +!o gave me t!e opportunity to con'uct our interns!ip program at I((L, I am t!an"ful to !onoura$le ;ourse coor'inator 0ana$ M', <mar Baru" C!an, @9 & BM, I(*1A for !is untiring an' patient gui'ance in carrying out our researc!, I +oul' li"e to give t!an"s to 0ana$ S!a! M', Anamul Da-ue, in c!arge of Investment Deptt, 0ana$ Caiyum Si"'er senior officer, 0ana$ S!a!i'ulla!, 0ana$ 2namul Da-ue in t!e 'epartment of Investment of I((L Mouc!a" (ranc!, *!e management of t!is (ranc! !a' $een e.tremely !elpful in provi'ing necessary 'ocuments, annual report, statements, $roc!ure etc, t!at !ave !elpe' for preparing t!is Interns!ip 1eport, I am also grateful to 0ana$ S!a! A$'ul DannanE 2.#;!airman, I((L, 0ana$ As!e-ue A!me' 0e$alE S@9, I((L, 9rof, Mo!', S!arif Dussain, 0ana$ M', 3urul Islam, 2@9, I((L, 0ana$ M', Ma!$u$#ul#Alam, 2@9, I(A,I((L, 0ana$ M', Da$i$ur 1a!man, DMD, I(A, I((L, Ms, Masuma (egum Asstt Director 7researc!8, I +oul' li"e to convey our appreciation an' t!an"s for t!ose +!o !ave gui'e' us generously +it! t!e rig!t "no+le'ge for t!is report,
E;e!uti%e Summ."y
*!is report is prepare' as a re-uirement of t!e Interns!ip 9rogram, *!e report +ill give a clear i'ea a$out t!e investment mec!anism of I((L, *!is report contains four main parts, *!e first part of t!e report is intro'uction, o$>ective, met!o'ology, scope an' limitation of t!e report &an overvie+ of I((L, *!e secon' part of t!e report is a$out investment un'er Islamic S!aria!, I((L investe' $y t!ree mo'es, *!ese are# (ai#mo'e, leasing#mo'e & S!are#mo'e, I((L commonly use (ai#mo'e, Sometimes t!ey use leasing#mo'e, Most of t!e time t!ey are not +illing to invest in S!are#mo'e, Anot!er portion of t!is part is a$out various special sc!eme of I((L suc! as Douse!ol' 'ura$le sc!eme, 1eal estate investment program etc, in t!is part rural 'evelopment sc!eme is also inclu'e', *!e t!ir' & last part of t!e report is a$out some pro$lems regar'ing I((L on investment, Suc! as t!e pro$lem of Mu'ara$a is% lac" of ovt, support, uncertain cost of capital an' t!e pro$lem of Mus!ara"a is% lac" of e.pertise persons, lac" of legal frame#+or" of Islami (an"ing in (angla'es!, *!e pro$lem of I>ara! is% 'isposing t!e asset, +!en t!e asset is no longer $eing nee'e', uncertainty a$out t!e total life of t!e asset etc, *o avoi' t!e a$ove pro$lems I((L can follo+ t!e follo+ing i'eas% I((L can 'iffuse its scope of investment t!roug! focusing S!aria! concept regar'ing investment among t!e $an" officers, employers an' t!e clients $y strong training, +or"s!op an' clients#gets toget!er, I((L s!oul' initiate 'ifferent investment mo'es accor'ing to 'iverse nee's of clients $y con'ucting !uge researc! an' stu'y etc,
@i
T.b1e o0 Co/te/t&
P."ti!u1."&
Letter of *ransmittal SupervisorFs ;ertificate Declaration 9reface Ac"no+le'gement 2.ecutive Summary
P.7e No
i ii iii iv v vi
P."t<* 2I/t"odu!tio/3
(ac"groun' of t!e Stu'y 9urpose of t!e 1eport <rigin of t!e 1eport 1ationality of t!e 1eport <$>ective of t!e Stu'y Met!o'ology of t!e 1eport Scope of t!e 1eport Limitation of t!e Stu'y An <vervie+ of I((L Distorical (ac"groun' of I((L <$>ective of Islami (an"ing ;ontri$uting in Ac!ieving t!e Ultimate oal of Islamic 2conomic System Mission of Islami (an" (angla'es! Limite' @ision of Islami (an" (angla'es! Limite' (usiness 9!ilosop!y of I((L Special Beatures of I((L Bunctions <f I((L
*
2 2 5 5 5 G 4 4 H ? 6 9 10 10 11 11 12
1H 1H
*19 19 20 2H 50 51
+,
55 54 5H 5? 56
After completing one !un're' an' t!irty t+o cre'it 71528 !ours at Manarat International University un'er t!e (ac!elor of (usiness A'ministration 7((A8 curriculum, +e +ere place' $y t!e $usiness 'epartment at I((L, as part of t!e Interns!ip 9rogram re-uirement, *!is report is prepare' for t!e interns!ip program consisting of a ma>or in 'ept! stu'y of t!e total $an"ing $usiness of Islami (an" (angla'es! Limite',
9ractical "no+le'ge is fun'amental for t!e application of t!eoretical intelligence, (earing t!is in min' an' interns!ip program +as $eing inclu'e' in t!e ((A curriculum, *!e goal of t!is analysis is to e.pose t!e stu'ent in t!e organi=ational +or" situation an' also to provi'e an opportunity for applying classroom learning in practice, *!ere are some 'ifference $et+een t!eories an' practice, Interns!ip program is a system $y +!ic! +e can accustom ourselves +it! t!e practical situation t!roug! t!e application of t!eoretical "no+le'ge into real life, t!e gap $et+een t!ese t+o can $e $ri'ge' up t!roug! t!is interns!ip proce'ure, As an in'ispensa$le part of ((A +e +ere place' in Mouc!a" (ranc! of I((L,
*o s!o+ t!e investment mec!anism an' pro'uct offerings in 'ifferent mo'es of I((L *o s!o+ overall investment proposal, appraisal proce'ures, 'ocumentation system of I((L an' ;onventional (an"s, *o s!o+ t!e 'ifference +it! conventional $an"ing regar'ing investment aspects, *o i'entify strengt! an' +ea"ness of investments of I((L, *o i'entify t!e pro$lems relate' to investments face' $y I((L, *o recommen'e' actions t!at may $e necessary to re'esign t!e investments of I((L,
a8 9rimary Data
I Bace#to#Bace conversation +it! t!e respective officers an' staffs,
Intervie+ing officers an' staffs, S!aring practical "no+le'ge of officials, 1elevant file stu'y provi'e' $y t!e officers concerne', In#'ept! stu'y of selecte' cases, Islami (an" *raining center 7I(*1A8,
$8 Secon'ary Data
Des" report of t!e relate' 'epartment Manuals of Islami (an" (angla'es! Limite' 7(ai#Mura$a!a, (ai# Mua>>al, (ai#Salaam, Mus!ara"a8
*raining s!eets +!ic! are provi'e' $y Islami (an" *raining & 1esearc! Aca'emy 7I(*1A8 <nline 'ata from I((L +e$site,
*!ere are some limitations in my stu'y, I face' some pro$lems 'uring t!e stu'y, +!ic! I am mentioning t!ese as $elo+%
Lac" of time
*!e time perio' of t!is stu'y is very s!ort, *!at is +!y I coul' not go in 'ept! of t!e stu'y, Most of t!e time t!e officials +ere $usy not a$le to give me muc! time,
Insufficient 'ata
Some 'esire' information coul' not $e collecte' 'ue to confi'entiality of $usiness,
<t!er limitations
As I am ne+ comer, t!ere is a lac" of previous e.periences in t!is concern, Many practical matters !ave $een +ritten from my o+n o$servation t!at may vary from person to person,
Islami $an"ing !as $een 'efine' is 'ifferent +ays, *!e 'efinition of Islami $an" as approve' $y t!e secretariat of t!e <I;, relate' is starte' in t!e follo+ing manner, &An Islami $an" is financial institution +!ose statutes, rules an' regulations e.pressly state itFs commitment to t!e principle of Islamic s!raFa! an' to !e $anning of t!e receipt an' payment of interest on any of its operation),8
S!a+"i Islami S!e!ta vie+ing t!e concept from t!e prospective of an Islamic economy an' prospective role to $e playe' $y an Islamic $an" t!erein opines% &is t!erefore, natural an' in'ee', imperative for an Islamic $an" to incorporate in its functions an' practices commercial investment an' social activities, as an institute 'esigne' to promote t!e civili=e' mission of an Islamic 2conomy) 7I$i'8,
Jiau''in A!ne' says, &Islamic (an"ing is essentially a normative concept an' coul' $e 'efine' as con'uct of $an"ing in consonance +it! t!e et!ics of value system of Islam,)7I$i'8
It appears from t!e 'efinition t!at Islamic $an"ing is systems of financial interme'iation t!at avoi's receipt an' payment of interest in its transaction an' con'ucts its operation in a +ay t!at it !elps ac!ieve t!e o$>ectives of an Islamic economy, Alternatively, t!is is a $an"ing system +!ose operation is $ase' on Islamic principles of transaction of +!ic! profit an' loss s!aring 79LS8 is a ma>or feature, ensuring >ustice an' e-uity in t!e economy, *!at is +!y Islamic $an"s are often "no+n as 9LS $an",
(angla'es! signe' t!e ;!arter of Islamic Development (an" an' committe' itself to reorgani=e its economic an' financial system as per Islamic S!aria! , *!e signe' year +as 19?G, In 0anuary 1961, *!e t!en 9resi'ent of 9eopleFs 1epu$lic of (angla'es! +!ile a''ressing t!e t!ir' Islamic Summit ;onference !el' at Ma""a! an' *aif suggeste' t!e Islamic countries s!oul' 'evelop a separate $an"ing system of t!eir o+n in or'er to facilitate t!eir tra'e an' commerce, *!is statement creates a favora$le situation to+ar's esta$lis!ing Islamic $an" an' financial institution in (angla'es!, 2arlier in 3ovem$er 1960, (angla'es! (an", t!e countryFs ;entral (an" sent a representative to stu'y t!e +or"ing of several Islamic $an"s a$roa', In 3ovem$er 1962, a 'elegation of ID( visite' (angla'es! an' s!o+e' "een interests of participate in esta$lis!ing a >oint venture Islamic $an" in t!e private sector, *!ey foun' a lot of +or" !a' alrea'y $een 'one an' Islamic $an"ing +as in a rea'y form for imme'iate intro'uction, *+o professional $o'ies of Islamic 2conomics 1esearc! (ureau 7I21(8 an' (angla'es! Islamic (an"ers Association 7(I(A8 ma'e significant contri$ution to+ar's intro'uction of Islamic $an"ing in (angla'es!, *!ey came for+ar' to provi'e training on Islamic $an"ing to top $an"ers an' economists to fill up t!e vacuum of lea'ers!ip for t!e future Islamic $an"s in (angla'es!, *!ey also !el' seminars, symposiums an' +or"s!ops on Islamic economics an' $an"ing t!roug!out t!e country to mo$ili=e pu$lic opinion in favor of Islamic $an"ing, *!eir professional activities +ere reinforce' $y a num$er of Muslim entrepreneurs +or"ing un'er t!e agency of t!e t!en Muslim (usiness society, 73o+ recogni=e' as in'ustrialist & (usinessmen Association8, *!e $o'y concerne' mainly in mo$ili=ing e-uity capital for t!e emerging Islamic $an", At last, t!e long 'ra+n struggle to esta$lis! *!e first interest free Islamic S!aria! $ase' $an" in (angla'es! incorporate' on 15 Marc! 1965 as a pu$lic limite' company un'er t!e ;ompanies Act 1915 in +!ic! 19 (angla'es!i nationals, G (angla'es!i institutions an' 11 $an"s, financial institutions an' movement $o'ies of t!e mi''le east an' 2urope inclu'ing ID( an' t+o eminent personalities of t!e "ing'om of Sau'i Ara$ia >oine' !an's to ma"e t!e 'ream a realty, *!e $an" o$taine' license from (angla'es! $an" on 26 Marc! 1965 an' starte' $an"ing operations on 50 Marc! 1965 t!roug! its main $ranc! at D!a"a, +!ic! +as formally inaugurate' later, on 12 August 1965, *!e $an" is a >oint#venture enterprise of 22 private sponsors of (angla'es!, t!e government of (angla'es!, Islamic Development (an", an' 15 $an"s an' financial institutions of t!e oil#ric! Mi''le 2astern Muslim ;ountries,
I((L starte' its $an"ing operations +it! an aut!ori=e' an' pai' up capital of *" 400 million an' *" H?,40 million respectively, *!e capital is 'ivi'e' into or'inary s!ares of *" 1,000 eac!, *!e pai' up capital of t!e $an" +as en!ance' to *" HG0 million in 2001, <f t!e ?9,400 or'inary s!ares of t!e $an" in 1964, foreign sponsors, inclu'ing t!e Islamic Development (an" 7ID(8, o+ne' 4H,000, +!ile 25,400 s!ares +ere o+ne' $y local sponsors an' t!e general pu$lic, Investment corporation of (angla'es! +as allocate' 20K of $an"Ls issue' capital, $ut t!e corporation su$scri$e' s!ares of *" 0,4 million only, *!e $an" is liste' +it! $ot! D!a"a an' ;!ittagong Stoc" 2.c!anges, Latter, ot!er four Islamic $an"s, Islamic insurance companies an' financial institutions +ere esta$lis!e' in t!e country, Some tra'itional $an"s opene' Islamic $an"ing $ranc!es in some ma>or cities,
*!e primary o$>ective of esta$lis!ing Islamic $an"s all over t!e +orl' is to promote, foster an' 'evelop t!e application of Islamic principles in t!e $usiness sector, Its o$>ectives are 'ifferent from conventional $an"ing t!at are as follo+s% ;on'ucting interest# free $an"ing 2sta$lis!ing participatory $an"ing instea' of $an"ing on 'e$tor# cre'itor relations!ip, Investing t!roug! 'ifferent mo'es permitte' un'er Islamic S!aria!, Accepting 'eposits on profit# loss s!aring $asis 2sta$lis!ing +elfare oriente' $an"ing system, 2.ten'ing co#operation to t!e poor, t!e !elpless an' t!e lo+#income group for t!eir economic enlistment 9laying a pivotal role in !uman 'evelopment an' employment generation,
More specifically, t!e o$>ectives of Islamic $an"ing +!en vie+e' in t!e conte.t of its role in t!e economy are liste' as follo+ing% *o offer contemporary financial services in conformity +it! Islamic S!aria!E *o contri$ute to+ar's economic 'evelopment an' prosperity +it!in t!e principles of Islamic >usticeE <ptimum allocation of scarce financial resourcesE an' *o !elp ensure e-uita$le 'istri$ution of income,
Interest#$ase' $an"ing, +!ic! is consi'ere' a practice of Riba in financial transactions, is unanimously i'entifie' as anti#Islamic, *!at means all transactions ma'e un'er conventional $an"ing are unla+ful accor'ing to Islamic Shariah, *!us, t!e emergence of Islamic $an"ing is clearly inten'e' to provi'e for Shariah approve' financial transactions,
Islamic $an"ing is claime' to $e more 'evelopment# oriente' t!an its conventional counterpart, *!e concept of profit s!aring is a $uilt#in 'evelopment promoter since it esta$lis!es a 'irect relations!ip $et+een t!e $an"Fs return on investment an' t!e successful operation of t!e $usiness $y t!e entrepreneurs,
Anot!er important o$>ective of Islamic $an"ing is t!e optimum allocation of scarce resources, *!e foun'ation of t!e Islamic $an"ing system is t!at it promotes t!e investment of financial resources into t!ose pro>ects t!at are consi'ere' to $e t!e most profita$le an' $eneficial to t!e economy,
9er!aps t!e must important o$>ective of Islamic $an"ing is to ensure e-uita$le 'istri$ution of income an' resources among t!e participating parties% t!e $an", t!e 'epositors an' t!e entrepreneurs
*o esta$lis! Islamic (an"ing t!roug! t!e intro'uction of +elfare oriente' $an"ing an' also ensure e-uity an' >ustice in t!e fiel' of all economic activities, ac!ieve $alance' gro+t! an' e-uita$le 'evelopment t!roug! 'iversifie' investment operations particularly in t!e priority sectors an' less 'evelopment areas of t!e country, *o encourage social#economic enlistment an' financial services to t!e lo+#income community particularly in t!e rural area,
Islamic $an" vision to al+ays strive to ac!ieve superior financial performance is consi'ere' a lea'ing Islamic $an" reputation an' performance,*o esta$lis! an' maintain t!e mo'ern $an"ing tec!nology, to ensure t!e soun'ness an' 'evelopment of t!e financial system $ase' on Islamic principles an' to $ecome t!e strong an' efficient organi=ation +it! !ig!ly motivate' professional, +or"ing for t!e $enefit of people,
$ase' upon accounta$ility, transparency an' integrity in or'er to ensure t!e sta$ility of financial system,
10
*ry to encourage savings in t!e form of 'irect investment *ry to encourage investment particularly in pro>ect, +!ic! are more li"ely to lea' to !ig!er employment,
*!e p!ilosop!y of I((L is to t!e principles of Islamic s!aria!, *!e organi=ation of Islamic conference 7<I;8 'efines an Islamic $an" as &An Islami $an" is financial institution +!ose statutes, rules an' regulations e.pressly state itFs commitment to t!e principle of Islamic s!raFa! an' to !e $anning of t!e receipt an' payment of interest on any of its operation), *!e sponsor, perception is t!at I((L s!oul' $e -uite 'ifferent from ot!er privately o+ne' an' manage' commercial $an" operating in (angla'es!, I((L to gro+ as a lea'er in t!e in'ustry rat!er t!an a follo+er, *!e lea'ers!ip +ill $e in t!e area of service, constant effort $eing ma'e to a'' ne+ 'imensions so t!at clients can get &A''itional) in t!e matter of services commensurate +it! t!e nee's an' re-uirements of t!e country gro+ing society an' 'eveloping economy,
It e.ten's socio#economic an' financial services to t!e poor, !elpless an' lo+# income group of t!e people for t!eir economic enlistment particularly in t!e rural areas
11
It plays a vital role in !uman resource 'evelopment of t!e country t!roug! 'iversifie' investment operations particularly in t!e priority sectors an' in t!e less 'evelope' areas,
Fu/!tio/& o0 IBBL
*!e operation of Islamic (an" (angla'es! Limite' can $e 'ivi'e' into t!ree 758 ma>or categories
*? Ge/e".1 B./6i/7
It inclu'es% a8 Mo$ili=ation of 'eposits $8 1eceipts an' payment of cas! c8 Dan'ling transfer transaction '8 <perations of clearing !ouse e8 Maintenance of accounts +it! (angla'es! (an" an' ot!er (an" f8 ;ollection of c!e-ues an' $ill g8 Issue an' payment of Deman' Draft, *elegrap!ic *ransfer an' 9ayment <r'er !8 2.ecuting customers stan'ing instruction i8 Maintenance of safe 'eposit loc"ers >8 Maintenance of internal accounts of t!e $an" Islamic $an"ing is a response to suc! e.igencies, It mo$ili=es savings of t!e common people in line +it! Islamic Shariah, *ec!ni-ues employe' $y Islamic $an"s for saving mo$ili=ation are as follo+s,
*,
,?Mud.".b.4 A!!ou/t
15
,? I/%e&tme/t
It inclu'es% I((L invests its money in various sectors of t!e economy t!roug! 'ifferent mo'es permitte' $y S!aria! an' approve' $y (angla'es! (an", *!e mo'es of investment are as follo+%
1G
+? Fo"ei7/ E;!4./7e
Boreign e.c!ange $usiness plays a vital role in provi'ing su$stantial revenue in t!e $an" income pool, Li"e all mo'ern $an" I((L operates in t!e area of t!e foreign e.c!ange $usiness, I((L performs t!e follo+ing tas"s% <pening letter of cre'it 7L;8 against commission for importing in'ustrial, agriculture an' ot!er permissi$le items un'er Islamic s!aria! an' import policy <pening letter of cre'it 7L;8 of cre'it on t!e principle of Mu'ara$a sale, on t!e principle of Mus!ara"a sale an' un'er +age earner sc!emes, Dan'ling e.port:import 'ocument 3egotiation of e.port:import 'ocument +!en 'iscrepancy occurs Binancing in import un'er M9I 7Mu'ara$a 9ost Import8 Binancing in e.port on profit or loss s!aring Dan'ling In+ar' an' out+ar' remittance
@? Ot4e" A!ti%itie&'
*!e I((L performs t!e follo+ing tas" for t!e +elfare of t!e society% Income generating sc!eme for t!e unemploye' yout! of t!e nation Monorom sale centre for mar"eting !omema'e garments, !an'icrafts an' ot!er items 2'ucation sc!eme for assisting poor sc!olar stu'ent to case an' !elp t!em to continue t!eir stu'y Dealt! sc!eme for fulfilment of !ealt! nee's of rural people
14
Islamic $an" !ospital +as esta$lis!e' to e.ten' first !an' mo'ern an' contemporary me'ical service to t!e people on non#profit $usiness Dumanitarian assistance is $eing provi'e' to t!e poor, families affecte' $y river erosion an' for marriage of poor girls 2nergy relief operations are provi'e' to t!e people affecte' $ y natural calamities Assistance to mos-ue for construction, repair an' renovation
1H
Fo"ei7/' I/te"/.tio/.1 A&&o!i.tio/ o0 I&1.mi! B./6& 2IAIB35 edd.45 K?S?A? A!!ou/ti/7 ./d Auditi/7 O"7./iB.tio/& 0o" I&1.mi! Fi/./!i.1 I/&titutio/& 2AAOIFI35 M./.m.5 B.4".i/? Ge/e".1 Cou/!i1 o0 I&1.mi! B./6& # Fi/./!i.1 I/&titutio/& 2GCIBFI35 M./.m.5 B.4".i/ 2IBBL i& . membe" o0 it& E;e!uti%e Cou/!i13 So!iety 0o" 9o"1d:ide I/te"<b./6 Fi/./!i.1 Te1e!ommu/i!.tio/ 2S9IFT3
1?
16
Investment of I((L
Islami (an" emp!asis on legitimate 7Dalal8 $usiness, Islamic (an" 'oes not invest in loans an' fi.e' interest securities, It can invest in or'inary s!are only +!ile interest $ase' $an" can invest in loans an' 'ifferent "in's of securities, Islami (an" esta$lis!es an' participate pro>ects +it! its client as a partner an' $ears t!e ris" along +it! t!e client on a proportionate $asis, t!e concept of Islamic (an" is to esta$lis! on egalitarian society $ase' on principles of social >ustice an' e-uity, Ae !ave gat!ere' t!e fact t!at investment management is t!e t!eme of I((L, *!e $an" ta"es 'eposits an' invests t!e same $ase' on t!e profit#loss s!aring, (an" go for t!e investment mainly +!ic! are long term an' profita$le in nature, I((L also give !ig! concentration on t!e investment t!at +ill generate more employment, As investment is one of t!e most priority areas for t!e I((L, so it nee's to cautious in investment 'ecision, *o ensure proper investment I((L al+ays go +it! in#'ept! stu'y $efore ma"ing t!e investment, So in t!e ne.t p!ases +e are going to 'emonstrate t!e +ay I((L follo+ t!e manage investment,
19
*o finance various 'evelopment sc!emes for poverty alleviation, income an' employment generation +it! a vie+ to accelerate sustaina$le socio#economic gro+t! an' upliftment of t!e society, *o s!un even !ig!ly profita$le investment in t!e fiel's for$i''en un'er Islamic S!ariFa! an' are !armful for t!e society, *!e (an" e.ten's investments un'er t!e principles of (ai#Mura$a!a, (ai# Mua==al, Dire 9urc!ase un'er S!ir"atul Mel" an' Mus!ara"a, *!e (an" is ma"ing sincere efforts to go for investment un'er Mu'ara$a principle in near future, *o invest in t!e form of goo's an' commo'ities rat!er t!an give out cas! money to t!e investment clients, *o contri$ute to social upliftment an' sustaine' 2conomic gro+t! of t!e country, Investment to tra'e, commerce, In'ustry, Boreign tra'e, I*, small scale in'ustry, transportation, service sector,
I((L invests its money in various sectors of t!e economy t!roug! 'ifferent mo'es permitte' $y s!aria! an' approve' $y t!e (angla'es! (an', *!e mo'es of investment are as follo+s%
(ai#Mec!anism 7*ra'ing Mo'e8% (ai#Mura$a!a (ai#Mua==al (ai#Salam Istis!ana I>ara Mec!anism 7Leasing Mo'e8 Leasing: I>ara : Dire 9urc!ase 7D98, Dire purc!ase un'er s!ir"atul Mel" 7D9SM8
20
.3 B.i<Mud.".b. b3 B.i<Mu&4.".6.
20
B.i<Mu".b.4.'
*!e +or' (ai means purc!ase an' sales an' t!e +or' 1i$!un means an agree' upon profit, (ai# mura$a!a may $e 'efine' as a contract $et+een a $uyer an' a seller un'er +!ic! t!e seller sells certain specific goo's 7permissi$le un'er Islamic s!aria! an' t!e la+ of t!e lan'8 to t!e $uyer at a cost plus agree' profit paya$le in cas! or on any fi.e' future 'ata in lump sum or $y installments, *!e mar"e' up profit may $e fi.e' in lump sum or in percentage of t!e cost price of t!e goo's,
Ty$e& o0 Mu".b.4.
In respect of 'ealing parties Bai-Murabaha may $e of t+o types <r'inary (ai#Mura$a!a, (ai#Mura$a!a or'er on an' 9romise?
O"di/."y B.i<Mu".b.4. is a 'irect transaction $et+een a $uyer an' a seller, Dere, t!e seller is an or'inary tra'er +!o purc!ases goo's from t!e mar"et in t!e !ope of selling t!ese goo's to anot!er party for a profit, In t!is case, t!e seller un'erta"es t!e entire ris" of !is capital investment in t!e goo's purc!ase', A!et!er or not !e earns a profit 'epen's on !is a$ility to fin' a $uyer for t!e merc!an'ise !e !as ac-uire',
B.i<Mu".b.4. o"de" o/ ./d P"omi&e i/%o1%e& t4"ee $."tie& t!e $uyer, t!e seller an' t!e $an", Un'er t!is arrangement, t!e $an" acts as an interme'iary tra'er $et+een t!e $uyer an' t!e seller, In ot!er +or's, upon receipt of an or'er an' agreement to purc!ase a !e"t.i/ $"odu!t 0rom t!e $uyer, t!e $an" +ill purc!ase t!e pro'uct from t!e seller to fulfill t!e or'er,
21
(ai#Mua>>al
(ai#Mua>>al may $e 'efine' as a contract $et+een a $uyer an' a seller un'er +!ic! t!e seller sells certain specific goo's 7permissi$le un'er Islamic S!aria! an' t!e La+ of t!e country8, to t!e $uyer at an agree' fi.e' price paya$le at a certain fi.e' future 'ate in lump#sum or +it!in a fi.e' perio' $y fi.e' instalments, *!e seller may also sell t!e goo's purc!ase' $y !im as per or'er an' specification of t!e $uyer
Meaning
*!e terms M (ai M an' M Mua>>al M !ave $een 'erive' from Ara$ic +or's NOP an' QRS , *!e +or' NOP means purc!ase an' sale an' t!e +or' QRS means a fi.e' time or a fi.e' perio', M (ai#Mua>>al M means sale for +!ic! payment is ma'e at a future fi.e' 'ate or +it!in a fi.e' perio', In s!ort, it is a sale on ;re'it,
(ai#Mura$a!a a, Sale on cost plus profit, $, ;as! or cre'it c, ;ost an' profit must $e 'isclose' to t!e cleint,
(ai#Mua>>al a, Sale on agree' price $, 2.clusively on cre'it, c, it is not man'atory to 'isclose t!e cost an' profit to t!e client,
(ai#salam
Un'er t!is mo'e (an" +ill e.ecute purc!ase contract +it! t!e client an' ma"e payment against purc!ase of pro'uct, +!ic! is un'er process of pro'uction, (ai#Salam contract +ill $e e.ecute' after ma"ing any investment s!o+ing price, -uality, -uantity, time, place an' mo'e of 'elivery, *!e profit is to $e negotiate', In t!is mo'e t!e payment as t!e price of t!e goo's is ma'e at t!e time of Agreement an' t!e 'elivery of t!e goo's is 'eferre',
I&ti&/.C S.1e
*!e IstisnaLa sale is a contract in +!ic! t!e price is pai' in a'vance at t!e time of t!e contract an' t!e o$>ect of sale is manufacture' an' 'elivere' later, *!e ma>ority of t!e >urists consi'er IstisnaLa as one of t!e 'ivisions of Salam, *!erefore, it is su$sume' un'er t!e 'efinition of Salam, (ut t!e Danafie sc!ool of 0urispru'ence classifies IstisnaLa as an in'epen'ent an' 'istinct contract, *!e >urists of t!e Danafie sc!ool !ave given various 'efinitions to IstisnaLa some of +!ic! are% &*!at it is a contract +it! a manufacturer to ma"e somet!ingM an' MIt is a contract on a commo'ity on lia$ility +it!
22
t!e provision of +or"M, *!e 9urc!aser is calle' LMustasniaL contractor an' t!e seller is calle' LSaniaL ma"er or manufacturer an' t!e t!ing is calle' LMasnooaL, manufacture', $uilt, ma'e 7A(II(8,
25
S!ir"atul Mel"
S!ir"at means partners!ip, S!ir"atul Mel" means s!are in o+ners!ip, A!en t+o or more persons supply e-uity, purc!ase an asset, o+n t!e same >ointly, an' s!are t!e $enefit as per agreement an' $ear t!e loss in proportion to t!eir respective e-uity, t!e contract is calle' S!ir"atul Mel" contract,
I>ar!
*!e term I>ara! !as $een 'erive' from t!e Ara$ic +or's 7Air8 an' 7U>rat8 +!ic! means consi'eration, return, +ages or rent, *!is is really t!e e.c!ange value or consi'eration, return, +ages, rent of service of an asset, I>ara! !as $een 'efine' as a contract $et+een t+o parties, t!e Dire an' Direr +!ere t!e Direr en>oys or reaps a specific service or $enefit against a specifie' consi'eration or rent from t!e asset o+ne' $y t!e Dire, It is a !ire agreement un'er +!ic! a certain asset is !ire' out $y t!e Dire to a Direr against fi.e' rent or rentals for a specifie' perio',
2G
Mu'ara$a!
It is a form of partners!ip +!ere one party provi'es t!e fun's +!ile t!e ot!er provi'es t!e e.pertise an' management, *!e first party is calle' t!e Sa!i$#Al#Maal an' t!e latter is referre' to as t!e Mu'ari$, Any profit accrue' is s!are' $et+een t!e t+o parties on a pre#agree' $asis, +!ile capital loss is e.clusively $orne $y t!e partner provi'ing t!e capital,
Importer features%
(an" supplies capital as Sa!i$#Al#Mall an' t!e client invest if in t!e $usiness +it! !is e.perience, A'ministration an' management is maintaine' $y t!e client, 9rofit is 'ivi'e' as per management, (an" $ears t!e actual loss alone, ;lient can not ta"e anot!er investment for t!at specific $usiness +it!out t!e permission of t!e (an" 7;lass, 3otes, Dussain, A$ul8,
Mus!ara"a%
An Islamic financial tec!ni-ue t!at a'opts &e-uity s!aring) as a means of financing pro>ects, *!us, it em$races 'ifferent types of profit an' loss s!aring partners!ip, *!e partners 7entrepreneurs, $an"ers8 etc,8 S!are $ot! capital an' management of a pro>ect so t!at profits +ill $e 'istri$ute' among t!em as per rations, +!ere loss is s!are' accor'ing to ratios of t!eir e-uity participation,
Important feature%
*!e investment client +ill normally run an' manage t!e $usiness,
24
*!e (an" s!all ta"e part in t!e policy an' 'ecision ma"ing as +ell as overseeing 7supervision an' monitoring8 t!e operations of t!e $usiness of t!e client, *!e (an" may appoint suita$le person7s8 to run t!e manage t!e $usiness an' to maintain $oo"s of accounts of t!e $usiness property, As t!e investment client s!all manage t!e enterprise, t!e (an" may pay more s!are of profit to !im t!an t!at of !is proportionate capital contri$ution, Loss, if any, s!a:r $e s!are' on t!e $asis of capital ratio 7;lass 3otes, A$ul Dussain8,
Sl,3o, Mus!ara"a 01, All parties supply e-uity in t!e $usiness 02, 2very s!are !ol'er !as t!e rig!t to participate in t!e $usiness, 05, Loss to $e $orne $y all parties as per 'ee' of agreement,
Mu'ara$a <nly one party supply e-uity in t!e $usiness, <nly t!e Mu'ari$ can perform:!an'ling t!e $usiness, <nly S!a!i$ al Mall !ave to $ear t!e capital loss,
S$e!i.1 S!4eme&'
1, Douse!ol' Dura$le Sc!eme In a 'eveloping country li"e (angla'es! people of mi''le an' lo+er mi''le class especially service !ol'ers +it! limite' income fin' it 'ifficult to purc!ase articles li"e refrigerator, television, cot, almira!, +ar'ro$e, sofa#set, pressure coo"er, se+ing mac!ine etc, +!ic! are part of mo'ern an' 'ecent living, *!ey can not en!ance t!e stan'ar' an' -uality of life to t!e 'esire' level 'ue to t!e constrain of t!eir limite' income, Islami (an" (angla'es! Limite' !as, t!erefore, intro'uce' Douse!ol' Dura$les Investment Sc!eme +!ic! !as alrea'y create' great ent!usiasm among t!e people an' receive' tremen'ous response from them. 2, Dousing Investment Sc!eme <ne of t!e $asic !uman nee's is to !ave a !ouse to live in, A !ouse is an a$o'e of peace an' !appiness, Dousing !as no+ $ecome an acute pro$lem in t!e country, specially in
t!e to+ns, cities an' metropolis, Ait! t!eir limite' income, it !as $ecome almost impossi$le on t!e part of t!e lo+er mi''le class, mi''le class an' sometimes, even for
2H
upper mi''le class to solve t!eir !ousing pro$lem, *o meet t!is $asic !uman nee', Islami (an" (angla'es! Limite' is committe' to contri$ute to t!is en' to provi'e a peaceful an' !appy living, *!e (an" !as intro'uce' AHou&i/7 I/%e&tme/t S!4emeA +it! t!e o$>ective to ease an' minimi=e t!e !ousing pro$lem an' assist service !ol'ers an' professionals +it! limite' income in materiali=ing t!eir 'ream of $ecoming o+ner of !ouses 5, 1eal State Investment 9rogram 9rofessionals, Service#!ol'ers, (usinessmen, 1eal 2state Developer an' ot!er categories of people +!o are not entitle' for availing investment facilities un'er Dousing Investment Sc!eme, s!all $e eligi$le un'er t!is programme, Investment is to $e e.ten'e' to $uil' ne+ !ouses an' for e.tension: completion of t!e !ouse alrea'y constructe', commercial $uil'ing, s!opping comple., flat:apartment etc, G, *ransport Investment 9rogram *!e role of mo'ern communication is most vital for t!e socio#economic gro+t! an' uplift of a 'eveloping country li"e (angla'es!, A soun' an' efficient communication net+or" is t!e pre#re-uisite for sustaine' 'evelopment t!roug! t!e e.pansion of tra'e, commerce an' in'ustry, In t!is $ac"'rop t!e 'eman' for roa' an' +ater transports !as increase' manifol' t!roug!out t!e country, Moreover, t!e use of mo'ern transports !as increase' "eeping pace +it! t!e rise of t!e stan'ar' of living of t!e professionals, ;onsi'ering all t!ese facts, Islami (an" (angla'es! Limite' !as intro'uce' AT"./&$o"t I/%e&tme/t S!4emeA, Un'er t!is sc!eme investment on easy terms is $eing e.ten'e' to t!e e.isting successful $usinessmen in roa' an' +ater transports an' potential entrepreneurs in t!is sector for 'ifferent types of roa' an' +ater transports, (esi'es, Multinational companies, esta$lis!e' $usiness !ouses an' +ell to 'o officials an' professionals can $ecome o+ner of various "in's of transports t!roug! Dire 9urc!ase un'er t!is sc!eme, 4, ;ar Investment Sc!eme ;ar is consi'ere' as on essential mo'e of transport in t!e mo'ern society, particularly $y a section of t!e officials, $usiness !ouses an' $usiness e.ecutives an' esta$lis!e' professionals for movement in 'isc!arging t!eir 'uties an' responsi$ilities punctually an' efficiently, Many of t!ese categories of people can not purc!ase a car on payment of entire purc!ase value at a time out of t!eir o+n sources, *o meet t!is nee' Islami (an" !as intro'uce' t!e AC." I/%e&tme/t S!4emeA for t!e mi' an' !ig! ran"ing officials of government an' semi#government organi=ations, corporations, e.ecutives
an' 'irectors of $ig $usiness !ouses an' companies an' also for persons of 'ifferent professional groups on easy payment terms an' con'itions,
2?
H, Investment Sc!eme for Doctors Islami (an" (angla'es! Limite' !as ta"en t!e initiative an intro'uce' t!e MDoctors Investment Sc!emeM to ensure mo'ern treatment an' me'ical facilities availa$le to t!e people t!roug! e.tension of (an"Ls investment facilities for self#employment of ne+ly gra'uate' 'octors an' at t!e same time e.ten'ing investment facilities to t!e esta$lis!e' me'ical practitioners to procure mo'ern an' sop!isticate' me'ical e-uipment ?, Small (usiness Investment Sc!eme Islami (an", as +elfare oriente' financial institution, is committe' to generate employment an' $ring a$out an overall improvement in t!e socio#economic con'ition of t!e people an' t!e -uality of t!eir life, *!e (an", to ma"e effective contri$ution in t!is respect, !as ta"en#up a special programme an' intro'uce' LSmall (usiness Investment Sc!emeL to ma"e t!e small tra'ers, entrepreneurs an' neglecte' unemploye' yout!s of ur$an an' rural areas self#reliant $y provi'ing t!em re-uire' financial support, *!e follo+ing $enefits +ill $e ac!ieve' t!roug! implementation of t!is Sc!eme 6, Agriculture Implements Investment Sc!eme Islami (an" (angla'es! Limite' is a +elfare oriente' (an", It can play positive an' important role in t!e economic 'evelopment, progress an' uplift of t!e country $y investing in t!e agricultural sector, *!e (an" !as, t!erefore, intro'uce' DA7"i!u1tu"e Im$1eme/t& I/%e&tme/t S!4emeD to provi'e po+er tillers, po+er pumps, s!allo+ tu$e+ells, t!ras!er mac!ine etc, on easy terms to t!e unemploye' yout!s for self# employment an' to t!e farmers to !elp augment pro'uction in agricultural sector 9, Micro In'ustries Investment Sc!eme *!is is inten'e' mainly to create ne+ >o$s for t!e e'ucate', s"ille' & semi s"ille' unemploye' an' also to encourage t!ose +!o remain outsi'e t!e purvie+ of investment 'ue to s!ortage of fun's an' insufficient collaterals, *!e sc!eme !as $een prepare' +it! easy terms an' con'itions to encourage t!e small entrepreneurs, e'ucate' unemploye' yout!s an' s"ille' :semi s"ille' persons to come for+ar' for esta$lis!ment of micro in'ustries commensurate +it! t!e local 'eman'
26
*!e Sc!eme !as $een ta"en up to assist t!e sil" +eavers of Mirpur area particularly in respect of re-uirement of +or"ing capital, (M12 of e.isting unit $y a''ing furt!er mac!ineries, to 'evelop ne+ entrepreneurs an' to assist t!e +or"ers for getting furt!er training for pro'ucing pro'ucts of various mo'ern 'esign an' for mo'ernisation of t!e Sil" Sector,
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Brom t!e a$ove figure +e can see t!at (ai#Mura$a!a mo'e cover 44K 0f total investment $ecause it is permissi$le for t!e client to purc!ase t!eir specifie' goo's Brom $an" +it! some mar"up price, (ot! part agree' t!e price, So it is lucrative to client, In D9SM client an' $an" provi'e e-uity an' purc!ase asset, s!are t!e $enefits >ointly, loss >ointly, So it is also popular, Mu'ara$a an' Mus!ara"a are !ig! ris"y investment for $an", So t!is mo'es investment is very fe+,
50
S9OT A/.1y&i&
S!rin"age in e.port, import an' guarantee $usiness 'ue to economic slump an' +ar overnment rules an' regulations
51
52
*!e ris" involve' in profit#s!aring seems to $e so !ig! t!at most of t!e $an"s !ave resorte' to t!ose tec!ni-ues of financing +!ic! $ring t!em a fi.e' assure' return, As a result, t!ere is a lot of genuine criticism t!at t!ese $an"s !ave not a$olis!e' interest $ut !ave in fact only c!ange' t!e nomenclature of t!eir transactions,
*!e Islamic $an"s 'o not !ave t!e legal support of central $an"s of t!eir respective countries 7e.cept in 9a"istan an' Iran8, +!ic! e.poses t!em to great ris"s,
*!e Islamic $an"s 'o not !ave t!e necessary e.pertise an' traine' manpo+er to appraise, monitor, evaluate an' au'it t!e pro>ects t!ey are re-uire' to finance, As a result, t!ey cannot e.pan' 'espite !aving financial li-ui'ity
*!e comple. pro$lem in measuring li-ui'ity is t!at lia$ility management in t!e conventional $an"ing system !as $een gra'ually replacing asset management to fun' li-ui'ity nee's, At present, no suc! facilities e.ist un'er t!e Islamic $an"ing system, As a result, t!ese $an"s !ave to 'epen' on t!eir central $an" to supply cas!,
*!ey !ave not yet $een successful in 'evising an interest#free mec!anism to place t!eir fun's on a s!ort#term $asis, *!ey face t!e same pro$lem in financing consumer loans an' government 'eficits,
Monitoring cost as +ell as cost of +riting an' enforcing contracts +oul' $e !ig!er in Islamic $an"ing t!an in t!e interest $ase' system +!ic! is t!e anot!er pro$lem face' $y t!e Islamic (an"s, $ecause of t!eir Mus!ara"a mo'e
of investment ,*!is !ig!er cost of information coul' $e ma>or set$ac" in effective implementation of t!e 9LS system,
55
Interest $ase' $an"s ma.imi=e t!eir profit su$>ect to cost of fun's as it is in a position to "no+ in a'vance, +it! a reasona$le 'egree of certainty, t!e amount of profit it may earn in t!e s!ort term, *!roug! t!e use of !e'ging it can also 'etermine t!e level of profits in t!e long run, Un'er t!e 9LS system, on t!e ot!er !an', t!ere is no suc! scope to "no+ t!e cost of fun's $efore!an', *!e 'epositors are pai' a portion of $an"Ts profits t!e volume of +!ic! is e.tremely uncertain, In t!is situation if profit rate e.pecte' $y t!e 'epositors is not reali=e', t!e Islamic $an"s coul' face greater uncertainty in t!eir profit $ase, @aluation of (an"Ts Assets %
It is argue' t!at Islamic $an"s may suffer a loss of value of its assets in t!e a$sence of a fi.e' positive rate of return, Burt!er, +it!out t!e provision of insurance Islamic $an"s may face trou$le in ma"ing t!eir system sta$le an' avoi'ing li-ui'ity crises, So far, un'er Islamic $an"ing, no suc! insurance system e.ists, *!eoretically, Islamic $an"s are li"ely to face a 'ual ris"% 7a8 t!e )moralT ris" 'ue to lac" of !onesty an' integrity on t!e part of t!e $orro+er of fun's in 'eclaring a loss, 7$8 t!e )$usinessT ris" arising from une.pecte' mar"et $e!aviour, *!e 'eposits un'er a profit an' loss s!aring system are conceptually more a"in to a mutual fun'Ts s!are certificate, *!ese 'eposits +oul' s!are in $ot! t!e realise' as +ell as unrealise' gains an' losses on t!e investment of Islamic $an"s, *ypically un'er current enerally Accepte' Accounting 9rinciples, t!e investment portfolio is a'>uste' to mar"et values in investment companies, An up+ar' a'>ustment of t!e assets account re-uires an offsetting cre'it to eit!er revenue or unreali=e' capital increment, Unreali=e' capital 'ecrement re-uires recor'ing of an unreali=e' loss on long#term e-uity securities as a contra item in stoc"!ol'erTs e-uity, Bailure of Islamic $an"s to finance !ig!#return pro>ects%
Islamic $an" fails to appropriate !ig! profit from !ig!#return pro>ects since t!e o+ners of t!ese pro>ects prefer $orro+ing from conventional $an"s +!ere cost of $orro+ing turns out to $e lo+er, *!at means, only t!e pro>ects +it! rates of return e-ual to or $elo+ t!e mar"et rate of interest are left +it! t!e Islamic $an"s, At t!is situation, Islamic $an"s are not a$le to invest on t!e pro>ects !aving rates of return $elo+ t!e prevailing rate of interest t!ere$y limiting t!eir capacity to utili=e investment opportunity to t!e level of t!eir conventional counterpart, *!is lea's
to limiting t!e application of profit#loss#s!aring mo'es suc! as Mu'ara$a an' Mus!ara"a, In ot!er +or's, Islamic $an"s, at t!at situation, s+itc! over to ot!er mo'es of financing suc! as Mura$a!a, !ire purc!ase, leasing, etc
5G
Re!omme/d.tio/
It is not une.pecte' to !ave many pro$lems in any organi=ation, Bor t!is reason alrea'y I !ave foun' many pro$lems of I((L, *o t!ese pro$lems, I can suggest follo+ing recommen'ation,
I((L can 'iffuse its scope t!e investment t!roug! focusing S!aria! concept regar'ing investment among t!e (an" <fficers, employers an' t!e clients $y strong training, +or"s!ops an' clients get#toget!er, *!e aut!ority of I((L s!oul' conveyance pressure on overnment $o'ies to run proper an' sufficient application of Islamic $an"ing la+ in (angla'es!, 9ractice amount of 'ou$tful income 'ecline' su$stantially 'uring t!e year as compare' to t!e past fe+ years, inclu'ing more carefulness of t!e Management in complying +it! S!aria!, As a result, i'le money +ill $e investe' to increase potential profit of t!is $an", *o fulfil t!e vision of &mass $an"ing) t!is (an" s!oul' grants investment portfolio to ne+ entrepreneur : ne+ $usinessman : ne+ companies etc, I((L s!oul' give more emp!asi=e on t!eir mar"eting effort an' try to increase t!eir sales force, I((L s!oul' appoint a ;ustomer 1elation <fficer at $ranc! level I((L s!oul' try to atten' 'ifferent type of target customer, I((L s!oul' increase t!eir profit rate on 'ifferent 'eposit sc!eme, Ma.imum clients 'o not "no+ a$out I((LFs loan sc!emes, *!ey s!oul' carryout more promotional activities to ma"e clients a+are a$out t!eir offers, It +as o$serve' t!at, I((L is a$sent in *@, print Me'ia, (ill (oar's an' Sponsors!ips etc, (an" s!oul' a'vertise a$out itself so t!at it can attract more clients, *!at +ill increase t!e $usiness t!e $usiness volume of t!e $an",
54
Co/!1u&io/
Most of t!e people of our country !ave a $a' impression a$out I((LFs operations regar'ing in'irect generation of interestE +!ic! means no 'ifference $et+een investments of I((L loan:cre'it:a'vance of conventional $an"s for t!is reason, *!ey are not too muc! intereste' +it! I((L $ecause ma>ority of our people !ave proper "no+le'ge a$out t!e activities of Islami (an"ing as +ell as its investment mec!anism, *!ey 'onFt "no+ mar" up is accepte' Islamic S!aria!, *!e $an" is committe' to run its all activities as per Islamic S!aria!, I((L t!roug! its stea'y progress an' continuous success !as $y no+ earne' t!e reputation of $eing one of t!e lea'ing private sector $an" of t!e country, *!e $an" !as s!o+n stea'y progress in t!is important sector, Main items of imports 7$y t!e !elp of I((L8 mac!inery, garments, fa$rics, an' accessories, s!ips of scrapping, rice, 9!armaceuticals etc, +!ere as main items of e.ports are >ute goo's, rea'yma'e garments, leat!er, fro=en fis!, fertili=er etc, I((LFs capital a'e-uacy, 'eposits, reserves, earning per s!are, e.port, import an' remittances are increasing 'ay $y 'ay, So, no 'ou$t I((L is a gro+ing profita$le financial institute an' its strengt!s is !ig!,
5H
A$$e/di;
Interns!ip 9rogram for ((A Stu'ents Brom 0uly 01,2006 to Septem$er 01,2006 Islami (an" (angla'es! Limite',
5?
Bib1io7".$4y
Boo6&' Ca$ir at el, *e.t (oo" on Islamic (an"ing, Islamic 2conomics researc! (earue, D!a"a
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