Seminar on Islamic Finance brainstroms prudential norms

Peninsula On-line: The Islamic Financial Services Board (IFSB) and the Faculty of Islamic Studies of the Qatar Foundation hosted yesterday the 3rd Seminar on Islamic Finance which talked about Corporate Governance and Prudential Requirements for the Islamic Financial

Services Industry.

“The main focus of this seminar is the prudential framework of Islamic finance where we tackled the issues surrounding that, and some of the standards given by the IFSB to address the issues on Islamic finance,” said Madzlan Mohamad Hussain, senior project manager of IFSB, which holds its offices in Kuala

Lumpur, Malaysia.

The seminar, which was held at the Doha Marriott Hotel, talked about the key contractual structures, among others, used in the Gulf region like the Murabaha (cost-plus financing or sale at markup price), Ijara (leasing arrangements that are comparable to conventional operating and finance leases), Istisna (manufacturing sale; operates like commissioned manufacture); Mudaraba (similar to an equity arrangement and is also similar to a conventional limited partnership; profit sharing); Musharaka (similar to an equity arrangement and can be compared to a joint venture in that two parties provide capital toward the financing of a project; partnership), and the Sukuk (Islamic bonds; certificates of equal value representing after closing subscription receipt of the value of the certificates and the putting to use as planned, common titles to shares and rights in tangible assets, usufructs and services or equity of a given project or equity of a special investment activity).

The speakers include Rifaat Abdel Karim, secretary general of IFSB and a professor at the University of Surrey, Monash University in Australia; Simon Archer, professor, University of Surrey; Khalid Howlander, vice president and senior credit officer of Asset Backed and Sukuk Finance in Dubai; Hamid Yunis, a partner in London Finance and Projects; and Madzlan Mohamad Hussain, senior project manager of IFSB. “This is the first time we’ve hosted a seminar here in Doha. We’ve been invited to host this in conjunction with our workshop on facilitating information of the IFSB standard at the Millennium Hotel. This is an annual event,” said Hussain. Hussain said it is good that Qatar is now developing other sectors, like tourism, for financial sources.

“Qatar is similar to other Gulf countries — too dependent on oil. If the prices of oil drop, the country will have a problem with liquidity. So it’s good that most Gulf countries now, like Qatar, are developing other sectors to rely on,” he said.