Background Material: Islamic Interbank Benchmark Rate (IIBR)

You can find additional information on the recently launched Thomson Reuters' Islamic Interbank Benchmark Rate (IIBR) through the various links below.  This includes the main Islamic Benchmark website as well as various PDF documents included below.


Further details can be found on the following topics:
- Background
- Definition, methodology & criteria
- Timing of publication
- Contributor Panel
- Governance

Specific PDF documents include:
IIBR fact sheet
IIBR FAQ
IIBR Governance Procedures 
Terms of Reference - Shariah Committee
Terms of Reference – Islamic Benchmark Committee
Shariah Opinion (English)
Shariah Opinion (Arabic)

Background Material: Islamic Interbank Benchmark Rate (IIBR)

Harvard Islamic Finance Project DataBank

The Harvard Islamic Finance Project (IFP) website contains reports of IFP events for the past sixteen years and the Databank with over 9,000 records which include bibliographic information along with abstracts on articles, books, book chapters, conferences and theses relevant to the field of Islamic finance and economics. In addition to these resources, a collection of Quranic verses and hadith as well as a glossary of terms related to Islamic finance are included.


Users can register and access the Databank free of cost at http://ifp.law.harvard.edu. The IFP also features an option for users to submit their own published work or any relevant items via "Submit Your Work" option on the menu bar.


Many thanks to Muhammad Hassaan Yousuf for highlighting this resource.

Harvard Islamic Finance Project DataBank

5th International Islamic Capital Market Forum (IICMF)

Risk Sharing: A Way Forward To Public Good
5th International Islamic Capital Market Forum (IICMF)
Kuala Lumpur on 10th November 2011

The IICMF is an effort by the SC to promote the Islamic capital market and serves as a capacity and knowledge building forum that addresses current issues, including strengths, challenges, risks and opportunities in the Islamic finance industry. The 5th IICMF will focus on a risk-sharing system as an alternative to the present fractional banking system from the perspectives of the economics, legal and Shariah.

The details on the event can also be viewed at http://www.sc.com.my/eng/html/icm/iicmf/iicmf_2011.pdf

5th International Islamic Capital Market Forum (IICMF)

Strategic Trends in the Islamic Banking and Finance Movement

Strategic Trends in the Islamic Banking and Finance Movement
By Monzer Kahf

Strategic Trends in the Islamic Banking and Finance Movement

Can Islamic finance play key role in growth and prosperity?

Can Islamic finance play key role in growth and prosperity?
By Mushtak Parker
Arab News
July 2011

"In perhaps one of her more potentially important speeches in recent times, Zeti Akhtar Aziz, governor of Bank Negara Malaysia, the central bank, stressed that the increasing internationalization of Islamic finance and the burgeoning trade and economic linkages between the emerging countries present an important opportunity for the industry to make a meaningful and enhanced contribution toward economic growth and prosperity of these countries."

Can Islamic finance play key role in growth and prosperity?

A Different Kind of Consolidation in Islamic Finance

A Different Kind of Consolidation in Islamic Finance
By Rushdi Siddiqui
July 2011

One of the most over-used words in Islamic finance is not standardization, scholars, regulations, etc., but 'consolidation'. Islamic banks, Islamic leasing companies, Takaful companies need to consolidate to reach size and achieve scale.

A Different Kind of Consolidation in Islamic Finance

Risk Management in Islamic and Conventional Banks: A Differential Analysis

Risk Management in Islamic and Conventional Banks: A Differential Analysis
Amanat Ali Jalbani and Salman Ahmed Shaikh
Journal of Independent Studies and Research
July 2009

Abstract: "Islamic banking is interest-free banking which makes it necessary for Islamic banks to take active part in the operations of the business, i.e. share profits as well as losses. Banks including Islamic banks prefer to take minimum risk. On the surface, it may seem that Islamic banks face more risk and hence, will have more volatile or even negative returns on their assets.

This paper analyzes the risk management procedures of Islamic banks by giving a differential analysis of risk management discussing only the unique characteristics of risk management in Islamic Banking. The usual credit assessment procedures and BASEL are not discussed. This paper looks at the comparative performance of Islamic banks and conventional banks by using ROE as the benchmark."

Risk Management in Islamic and Conventional Banks: A Differential Analysis

The Constitution and Islam: Are Tax Reforms Possible to Facilitate Islamic Finance?

The Constitution and Islam: Are Tax Reforms Possible to Facilitate Islamic Finance?
Brett Freudenberg, Griffith University - Griffith Business School
Dr. Mahmood Nathie, Griffith University
Revenue Law Journal, June 2011

Abstract: "Islamic banking and finance is emerging in global financial markets and governments seek to facilitate it. This article focuses on whether it is constitutionally possible for Australia to implement reforms to facilitate faithbased financial transactions.


There have been calls for Australia to become a financial hub – particularly in South East Asia. One aspect of this is the recognition of Islamic finance as an alternative in the marketplace. This would include ensuring that tax laws are synchronised with Islamic tenets on financial transactions and do not hinder such alternatives.


Being different to conventional finance, Islamic finance has attracted interest and scepticism, partially because of the lack of understanding and the paucity of academic research on the subject. While the idea of facilitating faith-based finance may seem economically rational, a fundamental question needs to be addressed: is it appropriate for Australia’s tax laws to be amended to facilitate what may be construed to be the furtherance of any religion? This article considers the theoretical considerations of tax and religion and assesses the implications of Islamic finance in light of Australian constitutional law."

The Constitution and Islam: Are Tax Reforms Possible to Facilitate Islamic Finance?

The Importance of Shari’Ah Supervision in Islamic Financial Institutions

The Importance of Shari’Ah Supervision in Islamic Financial Institutions
Hussain Gulzar Rammal
University of South Australia - International Graduate School of Management
Spring 2006

Abstract: "Islamic financing differs from conventional financing in that it prohibits the payment or receipt of interest. The concept of interest-free financing existed prior to the advent of Islam and was embraced in ancient Arabia. The concept was officially launched in the 1970’s by the Organization of Islamic Countries (OIC) and introduced in most Muslim nations and some Non-Muslim nations. But while it has experienced phenomenal growth rate, the Islamic financial system has been criticized for failing to incorporate the true spirit of Shari’ah in their actions. Islamic financial institutions are also divided over the interpretation of which products are considered halal (acceptable under Islamic law). In order to overcome some of these issues, financial institutions dealing with Islamic products are required to utilize the services of a Shari’ah adviser or a Shari’ah Supervisory Board (SSB). The paper recommends a more collaborative effort between the central banks of Muslim nations and regulatory organizations."

The Importance of Shari’Ah Supervision in Islamic Financial Institutions

Enhancing Transparency and Risk Reporting in Islamic Banks

Enhancing Transparency and Risk Reporting in Islamic Banks
Doctoral thesis, University of Surrey
Noraini Mohd, Ariffin (2005)

Enhancing Transparency and Risk Reporting in Islamic Banks

Islamic Finance and Sharia Compliant Transactions in India and Abroad: A Comparative Study

Islamic Finance and Sharia Compliant Transactions in India and Abroad: A Comparative Study
Tanay Nandi, National Law University Jodhpur (NLUJ)
Satabdee Mohanty, Gujarat National Law University
July 2010

Abstract: "One of the fundamental principles governing Islamic financing is that the receipt of interest is prohibited. This is categorically stated in the Qur'an: "Those who devour Riba (interest) will not stand except as stands one whom the devil hath driven to madness by (his) touch" (II:275) In an investment environment, Riba is interpreted as any return on money that is predetermined in amount and therefore includes modern day interest-based financing. Islamic principles allow instead for the replacement of interest by a return that is dependent upon the profitability of the underlying investment.


In addition, Islamic principles permit the financing of sales by means of deferred payment at a premium to the spot price. Modern scholars have also encouraged asset-backed finance where the return to the financier is linked either to the provision of an asset to the client or to the acquisition of an asset from the client. In all of the above a clear linkage emerges between the earning of returns and the assumption of risk.


But, in India it is in the embryonic stage. However, there are some non-banking cooperative societies being operated across the India that follows the fundament finance law. But, still no Islamic banks as per Reserve Bank of India’s norms have been settled in India.


This paper starts off by examining the banking structures with an Islamic finance window in other countries such as UK, Malaysia, Hong Kong etc, and goes on to examine the causes for its negligible presence in India and ends with emphasizing the need for a greater participation from the bankers in India in support of Islamic Finance."

Islamic Finance and Sharia Compliant Transactions in India and Abroad: A Comparative Study

True and Fair View - An Islamic Perspective

True and Fair View - An Islamic Perspective 
Doctoral thesis, University of Surrey
Bucheery, Raja Ali M (2001)

True and Fair View - An Islamic Perspective

Grooming Gen Y for Islamic Finance - Tweeting Islamic Finance

Grooming Gen Y for Islamic Finance
Tweeting Islamic Finance
By Rushdi Siddiqui
Global Head, Islamic Finance & OIC Countries, Thomson Reuters

Unless Islamic finance is made relevant to young people, it will struggle to gain popularity and grow in strength in the future.

Read the full article here.

Grooming Gen Y for Islamic Finance - Tweeting Islamic Finance

Islamic Banking in Indonesia: Lessons Learned

Islamic Banking in Indonesia: Lessons Learned
By Rifki Ismal, Directorate of Islamic Banking, Bank Indonesia
April 2011

This is a paper prepared for the Annual Meeting on Trade and Development, United Nations of Conferences on Trade and Development, April 6th-8th, 2011, in Geneva, Switzerland.

Abstract: "In Indonesia, Islamic banking shows a progressive performance with a robust performance of banking indicators. Its operations  engage non bank financial institutions, Islamic money and capital market and takaful (Islamic insurance) with the ultimate target of financing the real sector and improving the economy. However, there are still some challenges to be solved in particular the small market share, lack of human resources and, lack of product development. Some recommended actions are proposed in the paper to mitigate those problems and foster the development of the Islamic banking industry."

Islamic Banking in Indonesia: Lessons Learned

Dispute Resolution in Islamic Banking and Finance: Current Trends and Future Perspectives

Dispute Resolution in Islamic Banking and Finance: Current Trends and Future Perspectives
Umar Aimhanosi Oseni
International Islamic University of Malaysia (IIUM)
August 2009

Abstract: "The current legal framework for dispute resolution in the Islamic banking and finance industry in developing countries may not adequately serve the purpose for which the financial institutions were set up. Meanwhile, the Islamic legal framework for dispute resolution has established rules for financial disputes as recognized under the classical law. This paper examines the current practice of dispute resolution in Islamic banking and finance with case analyses of selected Muslim countries. From our findings, disputes emanating from this industry are heard by the conventional courts and tribunals which, in most cases, do not have the requisite expertise. It is argued that since Islamic banking and finance disputes are sui generis, the panel of judges must be composed of experts in the field. The paper concludes that a legal framework should be established for dispute resolution in countries where Islamic banking and finance is being implemented. For a proper Islamization of the banking and finance sector, disputes arising from this sector should not be subjected to the convoluted conventional rules. The paper proposes a legal framework for dispute resolution in the Muslim world based on hybrid processes of Alternative Dispute Resolution (ADR) recognized in Islamic law."

Dispute Resolution in Islamic Banking and Finance: Current Trends and Future Perspectives

Thought Leadership: the Neglected Essence of Islamic Finance

Thought Leadership: the neglected essence of Islamic Finance
Director, Hatim El Tahir
Deloitte’s Islamic Finance Knowledge Center
August 2010

"Have Islamic Financial Institutions (IFIs) around the world, including the Gulf region, been so busy structuring products and services that they have overlooked the importance of communicating the essence of Islamic Finance?"


This is quite possibly the most important issue facing the industry today and has the potential of being the main determinant of its future.

Thought Leadership: the Neglected Essence of Islamic Finance

The Implementation of Accounting Standards for Islamic Banks: a Study of Preparers' and Auditors' Opinions in Sudan

The Implementation of Accounting Standards for Islamic Banks: a Study of Preparers' and Auditors' Opinions in Sudan
Doctoral thesis, University of Surrey
Mustafa, Badreldin G (2003)

The Implementation of Accounting Standards for Islamic Banks: a Study of Preparers' and Auditors' Opinions in Sudan

Opalesque Islamic Finance Intelligence - Sixteenth Issue

We have compiled a great mix of content for this edition of OIFI (download the PDF version), and we start with our Editorial's anecdotal perspective of the MENA region.  Having repeatedly received inquires regarding consumer appetite for Islamic finance products, our Featured Resource section compiles various country studies on consumer awareness, behaviour and perception.

Mudaraba applied in the context of microfinance is the theme for the Featured Structure segment, as scrutinized by practitioner Azhar Nadeem. Hdeel Abdelhady provides an operational perspective to Islamic finance in Lex Islamicus - with particular emphasis on governance and Shariah Board reports (SBRs).

Having spent time in Matsushima (one of the three famous "views" of Japan) in the north of Miyagi prefecture, it is a welcome coincidence that the Kulliyyah Korner features the research of Kyoto-based Nagaoka Shinsuke. Our best goes to him and everyone in Japan.

The Industry Snapshot offers a further analysis of Education based on the EPL concept (Education, Perception, Liquidity), as seen by strategist Joy Abdullah. This is followed by Douglas Clark Johnson who shares his perspective on Bahrain in our Opinion Column.

We hope you enjoy the sixteenth edition of OIFI and as always we are glad to hear from our readers and welcoming all comments & feedback. Remember that you can visit our online archive (see reference link) for access to our ever-growing databank of Opalesque Islamic Finance Briefing as well as all of the back issues of Opalesque Islamic Finance Intelligence.

Download the complete issue of Opalesque Islamic Finance Intelligence here.

Alternatively you can read each article separately in the OIFI Archive:
Editor’s Note: In the Name of Egypt
Featured Resource: The Islamic Finance Consumer
Featured Structure: Islamic Business Contracts and Microfinance A case of Mudaraba
Lex Islamicus: Operational Excellence is the Key to Unlocking Lasting Value in Islamic Finance
Kulliyyah Korner: On the Theoretical Dichotomy of Islamic Finance
Industry Snapshot: E.P.L. in Islamic Finance - Education (Extra Time)
Opinion Column: Bahrain: Time to be Truly Business-Friendly

Opalesque Islamic Finance Intelligence - Sixteenth Issue

Central banking and monetary management in islamic financial environment

Central banking and monetary management in islamic financial environment
Hanif, M. Nadim and Sheikh, Salman
July 2010

Abstract: "Continuous growth in Islamic finance calls for studying the framework in which the monetary policy maker (i.e., central bank) performs its functions. Central banks in Muslim countries are using various instruments for monetary policy purpose including interest rate. As a result, Islamic financial institutions (IFIs) are facing issues in benchmarking the price of financial instruments. Acceptable solution to benchmarking lies in the presence of a real economic activity in the base of any proposal and its feasibility for business performance when put against conventional banking. This paper presents empirical evidence of statistical equivalence of nominal GDP growth rate and official interest rate for ‘advanced,’ ‘all,’ and some Muslim countries. We propose nominal GDP growth rate as benchmark for pricing domestic financial transactions of IFIs as well as for pricing external bilateral/ multilateral loans. The paper also suggests nominal income targeting as monetary policy regime and provides a liquidity management mechanism for banking system in Islamic financial environment."

Central banking and monetary management in islamic financial environment

The Deloitte Islamic Finance leaders survey in the Middle East

The Deloitte Islamic Finance leaders survey in the Middle East
Benchmarking Practices
Biannual Survey - 2010
Deloitte’s Islamic Finance Knowledge Center

"In order to best serve the interests of its clients and the Islamic Finance practice generally, the Deloitte’s Islamic Finance Knowledge Center (Deloitte ME IFKC) seeks to implement an evidence-based approach to the evolution of Islamic Finance Thought Leadership (IFTL).

This is the first Deloitte Islamic Finance leaders survey in a biannual series targeted at industry practitioners and leaders of Islamic Financial Institutions (IFIs) in the Middle East. The survey is based on interviews conducted with industry leaders between April and June 2010.

In general, this report is designed to provide industry stakeholders-regulators, standard-setters, Islamic financial institutions (IFI), investors, and practitioners with a portrayal of the trends and issues prevailing in the current economic environment."

The Deloitte Islamic Finance leaders survey in the Middle East