ISLAMI
BANK BANGLADESH
LIMITED
Islamic Banking Opportunities in Asia:
Focus-Bangladesh
Mohd. Shamsul Haque
Deputy Managing Director
Operations Wing
Islami Bank Bangladesh Limited
ISLAMI
BANK BANGLADESH
LIMITED
Country Information : Bangladesh
150 Million Population
Muslim
: 90%
Growth Rate
: 1.32%
Density
: 990 per Square Km.
Life expectancy
: 67 years
Below extreme poverty line : 25%
Per Capita Income : USD 750
ISLAMI
BANK BANGLADESH
LIMITED
Global vis a vis Asian Islamic Banking Scenario
Due to financial crisis World output contracted by 0.80% in 2009 as against
growth of 3.00% in 2008. World trade volume also contracted by 12.30% in
2009 as against growth of 2.80% in 2008. Despite negative growth of world
output and world trade volume there has been continuous growth of Islamic
Banking world wide.
According to an S&P report, assets of the top 500 Islamic Banks expanded
by 28.60% to total $822 billion in 2009, compared to $639 billion in 2008.
Malaysia is recognized as Asia’s Islamic Financial hub by Price Water
House Coopers. At the end of 2009 Malaysia’s Islamic Banking assets
equivalent to $35.20 billion having largest “sukuk” i.e the Islamic equivalent
to bond to $25 billion.
ISLAMI
BANK BANGLADESH
LIMITED
Global vis a vis Asian Islamic Banking Scenario
In Asia, mainly in the Middle Eastern countries, Malaysia, Indonesia,
Thailand, India, Pakistan and Bangladesh Islamic Banking growth is at a
faster rate then the conventional banking.
In Bangladesh there are 7 (seven) full fledged Islami Bank having 496
Branches and 8 (eight) Bangladeshi Conventional Banks and 3 (three)
Foreign Commercial Banks had 21 (twenty one) Islami Banking Branches.
During the recent past 2 (two) conventional banks were converted into full
fledged Islami banks.
Among the above, growth rate of IBBL was 23% as against 20.00 %
conventional banks.
ISLAMI
BANK BANGLADESH
LIMITED
Islamic Banking Opportunities in Asia: Focus-Bangladesh
Objectives :
Despite the growth of Islamic banking along with Traditional banking in
Bangladesh and other parts of the world, there is a debate regarding
whether Islamic banking is any different from the Traditional banking. In
this presentation, in order to clarify misleading concepts about Islamic
banking, it has been sought to achieve several objectives.
First, the savings and investment mobilization mechanisms of both
Islamic and Traditional banks have been analyzed.
Second, a number of apparent similarities that frequently equalize both
banking have been explained, although they are quite different by
nature and in effect.
ISLAMI
BANK BANGLADESH
LIMITED
Islamic Banking Opportunities in Asia : Focus-Bangladesh
Objectives Cont…
Third, the Islamic nature and interpretation of such apparent
similarities between the Islamic and Traditional banking, as premises
of Islamic banking have been explained.
Finally, the
the trends
trends of
of branch
branch expansion
expansion of
of all
all Islamic
Islamic banks
banks and
and the
the
Finally,
trends of
of Islamic
Islamic banking
banking branch
branch expansion
expansion of
of the
the traditional
traditional banks
banks in
in
trends
Bangladesh have
have been
been analyzed
analyzed to
to examine
examine the
the premises
premises of
of Islamic
Islamic
Bangladesh
banking.
banking.
It is
is hypothesized
hypothesized that
that the
the growth
growth of
of Islamic
Islamic banking
banking system
system is
is gaining
gaining
It
momentum in
in Bangladesh.
Bangladesh. The
The results
results indicate
indicate Islamic
Islamic banking
banking aa
momentum
promising one
one for
for the
the country
country to
to minimize
minimize its
its gap
gap between
between savings
savings and
and
promising
investment.
investment.
ISLAMI
BANK BANGLADESH
LIMITED
What is Islamic Banking ?
An Islamic Bank is a financial institution that operates with the
objective to implement and materialize the economic and financial
principles of Islam in the banking arena.
As per OIC:
“a financial and social institution whose objectives and operations
as well as principles and practices must conform to the principles
of Islamic Shariah (Jurisprudence), and which must avoid the
interest in any of its operations” and “a Company which carries on
Islamic banking business.
Islamic Banking Act 1983 of Malaysia :
Islamic banking business means banking business whose aims and
operations do not involve any element which is not approved by
the religion Islam.”
ISLAMI
BANK BANGLADESH
LIMITED
What make Islamic Banking Different from
Conventional Western banking
No interest (Riba) paid or charged for any transaction or
service to ensure justice, welfare and non-exploitation.
The investments of an Islamic bank must be channeled to
the Islamic Shariah approved (Halal) sectors by Islamic
modes of finance like Mudaraba, Musharaka, Bai-Muajjal,
Bai-Salam, Ijara, Hire Purchase, etc., Based on the sharing
of risk and profit.
Islamic bankers in effect generate “profit and loss”
transactions in which the lender or bank shares in gains or
losses based on the economic viability of the project and
the credit worthiness of the customer.
ISLAMI
BANK BANGLADESH
LIMITED
Principles of Islamic Banking and Finance
Prohibition on interest : The Qur'an forbids the charging of Riba
on money lent. "O You who believe! Fear Allah and give up that
remains of your demand for usury, if you are indeed believers."
Concept of money
In an Islamic system money is primarily and exclusively a measure
of value, a means of exchange and a standard of deferred of
payment. Money has to operate through some real economic activity
or service. It is a facilitator and an intermediary, not an active selfcontained agent in itself.
ISLAMI
BANK BANGLADESH
LIMITED
Principles of Islamic Banking and Finance
Cont…
Rules regarding Islamic investment
Any predetermined payment over and above the
actual amount of principal is prohibited.
The lender must share in the profits or losses
arising out of the enterprise for which the money
was lent
Making money from money is not acceptable in
Islam.
Gharar (Uncertainty, Risk or Speculation) is also
prohibited.
Investments should only
products that are not
discouraged by Islam
support practices or
forbidden or even
ISLAMI
BANK BANGLADESH
LIMITED
Analysis of Savings :
Islamic vs. Traditional banking
Islamic Banks
services
Traditional banks
Al Wadiah (Trust) Current
Current
Mudarabah Savings and
Savings and
Term deposits.
Fixed Deposits.
ISLAMI
BANK BANGLADESH
LIMITED
Analysis of Savings :
Islamic vs. Traditional banking
Islamic
Islamic Banks
Banks
Islamic banks accept deposits with the condition that the money will be put
to work combined with the skills and management expertise of banks.
The depositor would get back his principal amount together with a share of
profit after the expiry of the contract.
In fact, the depositor agrees to put his money in the bank’s investment account
and to share profits with the bank. In this case, the depositor is the supplier of
capital and the bank is the manager of capital.
The depositor does not earn interest on a fixed rate in Islamic banking system,
but accepts some of the business risks and earns a share of the profit.
The depositor is not guaranteed any pre-determined return on the nominal
value of his deposit like interest-bearing banks, but is treated as a shareholder
of the bank and as such, is entitled to a share of the profits made by the bank.
if the bank incurs losses, the depositor shares in these losses and the value of
his deposit is reduced.
ISLAMI
BANK BANGLADESH
LIMITED
Analysis of Savings :
Islamic vs. Traditional banking
Traditional
Traditional banks
banks
The Traditional bank accepts deposits to supply money to the income
generating activities of entrepreneurs. The major source of funds for
Traditional banks is customer deposit, on which the bank pays fixed
interest rate.
This deposit is a form of debt given to the bank by a bank customer.
The bank has to pay to the depositor the principle as well as interest,
regardless whether the bank makes a profit from the money or not.
In case of a bad loan, the bank has to pay the depositor from its own
resources. The depositor has not shared risk with the bank, but is getting
paid for his debt to the bank
ISLAMI
BANK BANGLADESH
LIMITED
Analysis of Investment Mechanisms :
Islamic vs. Traditional banking
Lending (Investment) services :
Islamic Banks
Traditional banks
Bai-Murabaha
Loans
Bai-Muajjal
Cash Credits
Ijara
Overdrafts
Bai-Salam
Purchase or Discount of Bills
Qard Hasana
Advances for Hire-purchase
Mudarabaha
Musharakah
ISLAMI
BANK BANGLADESH
LIMITED
Analysis of Investment Mechanisms :
Islamic vs. Traditional banking
Islamic Investment Mechanisms
Islamic banks earn profit either from investment in trading (bai) and leasing
(Ijara) or in production/manufacturing.
As a result, Islamic banks get directly involved in trade and industry, for
which Islamic banks perform functions of both an intermediary and manager.
Lack of expertise to appraise and monitor different types of industries and
long drawn court procedures for recovery of bad loans in case of default by
borrowers make Islamic banks hesitant for long-term Mudaraba or Musahraka
modes of lending.
Consequently, ' bai ' and ‘lease’ modes of investment become dominant forms
of financing by Islamic banks.
ISLAMI
BANK BANGLADESH
LIMITED
Analysis of Investment Mechanisms :
Islamic vs. Traditional banking
Islamic Investment Mechanisms
Cont…
Islamic banking is involved indirectly with commodity trading, as a
manager of funds based on the request of the client.
The business relationship between the bank and client on an actual
basis considers every aspect of assurance of profitability, such as credit
risk, liquidity risk, maturity risk and inflation risk.
In case of genuine default, the Islamic bank recovers only principal
without any compensation for bearing risk.
In case of willful default, there is no alternative to the Islamic bank
except demanding compensation for bearing risk. However, Islamic
banks do not account this compensation as part of its income, rather
they distribute these monies to the poor.
ISLAMI
BANK BANGLADESH
LIMITED
Analysis of Trends of Islamic Bank Branch Expansion
1983: Islami Bank Bangladesh Limited, the 1st Islamic Bank in South East
Asia, started its journey with 3 branches.
1987: Al-Baraka Bank Ltd. (Now ICB Islamic Bank Limited) established and
IBBL branch number stood at 18.
1995: Al Arafah Islami Bank Ltd. and Social Investment Bank Ltd. (renamed
as Social Islami Bank Limited) were established.
1998: The number of branches of 4 Islamic Banks stood at 172.
2000: Prime Bank Ltd., a Traditional bank, opened an Islamic branch that
provided a new dimension and set a new example of dual banking
system in the country.
2000: Shamil Bank Bahrain, (Now Bank Al- Falah Ltd.) a foreign Islamic bank
opened its branch in Bangladesh. The number of Islamic bank branches
stood at 194.
ISLAMI
BANK BANGLADESH
LIMITED
Analysis of Trends of Islamic Bank Branch Expansion Cont…
2001: Shahjalal Bank Ltd., a local Islamic bank, was established.
2002: 5 domestic and one foreign Islamic banks’ branches stood at 225.
2003: 5 new domestic Traditional banks namely
i.
The Dhaka Bank Ltd.
ii. The South East Bank Ltd.
iii. Premier Bank Ltd.
iv. The City Bank Ltd. and
v. Jamuna Bank Limited opened 9 Islamic bank branches.
Prime Bank Ltd. also opened second Islamic branch in the same year.
Up to the year 2003: The number of branches of 7 Islamic banks stood at 496
and number of Islamic branches of 11 Traditional banks stood 21 i,e, altogether
517 =(496+21) Islamic bank branches were opened in the country.
ISLAMI
BANK BANGLADESH
LIMITED
Analysis of Trends of Islamic Bank Branch Expansion Cont…
2004: EXIM Bank Ltd. has migrated all of its conventional banking operation
into Shariah based Islami banking with its 52 branches.
Subsequently four (4) nationalized traditional commercial banks (the largest
banking companies) took initiative to implement Islamic banking system side by
side with their existing one.
2005: Bank Al Falah Limited, a foreign Islamic bank opened its office in
Bangladesh and now its branch number is 5.
ISLAMI
BANK BANGLADESH
LIMITED
Analysis of Trends of Islamic Bank Branch Expansion
Cont…
In the year 2009, the total number of Islamic banks stood at 8 and the total
number of Islamic bank branches stood at 517 in Bangladesh.
It follows, therefore, the growth of Islamic banking in terms of branch expansion
was observed not only in Islamic banking companies but also in Traditional
banking companies.
The premises of Islamic banking system in Bangladesh have become stronger,
although Islamic-banking system is working side by side with Traditional banking
system.
It is an encouraging experience indicating a promising banking system for other
countries of Asia to minimize their gap between savings and investment.
ISLAMI
BANK BANGLADESH
LIMITED
Analysis of Trends of Islamic Bank Branch Expansion
Year
No. of
Islamic
Bank
No. of
Branches
of Islamic
Banks
Year
No. of
Islamic
Bank
No. of
Branches of
Islamic
Banks
1983
1
3
1995
4
123
1984
7
1996
137
1985
13
1997
152
1986
18
1998
172
24
1999
185
1988
37
2000
5
194
1989
58
2001
6
208
1990
71
2002
225
1991
84
2003
242
1992
97
2004
7
258
10
1993
103
2009
8
496
21
1994
111
1987
2
No. of Islamic
Branches of
Traditional
banks
No. of Islamic
Branches of
Traditional
banks
1
ISLAMI
BANK BANGLADESH
LIMITED
Regulatory and Supervisory Body :
Securities & Exchange Commission
Central Bank : Bangladesh Bank
Islamic Banks Consultative Forum (IBCF)
Central Shariah Board for Islamic Banks of Bangladesh
.
ISLAMI
BANK BANGLADESH
LIMITED
Central Bank Guidelines for Islamic Banking:
November 2009
Criteria for setting up full-fledged Islamic Bank.
The proposed bank company will be a public limited company and a minimum of 50%
share shall be offered to the public.
All the financial transactions of the banking company shall be conducted based on the
principles of Islamic Shariah.
The banking company, to commence business, shall raise a minimum paid-up capital
of Tk.2.00 billion and shall at all times maintain the required capital adequacy ratio,as
prescribed by the Bangladesh Bank.
Principles of Deposit
Islamic banks. receive deposits under two principles:
i) Al-Wadeeah principle.
ii) Mudaraba principle.
ISLAMI
BANK BANGLADESH
LIMITED
Central Bank Guidelines for Islamic Banking
Investment Principles & Investment Products
Islamic banks do not directly deal in money. They run business with
money. The funds of Islamic banks are mainly invested in the
following modes:
.
1) Mudaraba
2) Musharaka
3) Bai-Murabaha (Murabaha to the purchase orders)
4) Bai-Muajjal
5) Salam and parallel Salam
6) Istisna and parallel Istisna
7) Ijara
8) Ijarah Muntahia Bittamleek (Hire Purchase)
9) Hire Purchase Musharaka Mutanaqisa (HPMM)
10) Direct Investment
11) Investment Auctioning etc.
12) Quard
13) Quard Hassan etc.
ISLAMI
BANK BANGLADESH
LIMITED
Central Bank Guidelines for Islamic Banking
Framework of Rate of Return:
Under Mudaraba principles, profit accrued from investment and
financing are shared between the depositors and the bank based on
pre-agreed profit ratio. Losses, if any, will be borne by the
depositor unless the loss is due to the negligence by the bank in
managing the depositors' funds.
Given this unique relationship where the depositors would have a
direct. financial interest over the bank's income, it is essential to
ensure calculation of rate of return in a fair and equitable manner.
ISLAMI
BANK BANGLADESH
LIMITED
ISLAMIC BANKS CONSULTATIVE FORUM (IBCF)
The problems and issues relating to the growth and development of
Islamic Banking in Bangladesh are discussed and common strategy and
policies are formulated for implementation through this common Forum.
Goals :
• To establish Central Shariah Board for all Islamic Banks in Bangladesh,
Islamic Money Market, Islamic Insurance Company(s),
• Innovation of new financial products
• Embarking in investment through syndication etc.
ISLAMI
BANK BANGLADESH
LIMITED
Central Shariah Board for Islamic Banks of Bangladesh
Central Shariah Board for Islamic Banks of Bangladesh
(CSBIB) is a national Islamic non-profit corporate body of
Islamic banks and Islamic banking branches/windows
operating in Bangladesh.
The main objective of CSBIB is to provide overall cooperation
and assistance to the government, central bank, regulatory
authority and its member banks for tracking right path to
Islamic banking industry under the light of Islamic Shariah.
ISLAMI
BANK BANGLADESH
LIMITED
Islami Bank Bangladesh Limited :
Pioneer in Bangladesh
ISLAMI BANK BANGLADESH LIMITED (IBBL) was
established on 13th March 1983
IBBL is a commercial Bank
IBBL is a scheduled Bank
IBBL is a multinational Bank
IBBL is a joint venture Bank
ISLAMI
BANK BANGLADESH
LIMITED
Mission : Islami Bank Bangladesh Limited
To introduce welfare oriented banking system ensuring equity
and justice in the field of all economic activities
To achieve balanced growth and equitable development
through diversified investment operations
To invest in the priority sectors and less developed areas of
the country
To encourage socio-economic enlistment and sustained
economic growth of the country.
ISLAMI
BANK BANGLADESH
LIMITED
Capital Structure of IBBL
Particulars
2000
2005
2009
Authorized Capital
Million US$
14.50
72.46
144.93
Paid of Capital
Million US$
5
40
90
39
121
343
Foreign Shares
62%
57.08%
58.23%
Local Shares
38%
42.12%
41.77%
Total share holders
7549
17201
52,164
Dividend
25%
stock
25%
stock
20% stock
& 10% cash
Face value per Share
$14.49
$14.49
$1.45
EPS
$0.51
$0.71
$0.80
Market price of Shares (Highest)
$4.7.9
$ 8.09
$12.90
Equity Million US$
ISLAMI
BANK BANGLADESH
LIMITED
Equity Structure of IBBL
Particulars
Million US$
2009
% to
RWA
% to total
Capital
2008
% to
RWA
% to
total
Capital
89.53
0.03
90.49
5.32
0.46
26.86
212.69
3.05%
0.00%
3.08%
0.18%
0.02%
0.91%
7.24%
26.15%
0.01%
26.44%
1.55%
0.14%
7.84%
62.13%
68.87
0.03
71.60
1.74
0.46
20.66
163.36
2.74%
0.00%
2.85%
0.07%
0.02%
0.82%
6.50%
25.59%
0.01%
26.60%
0.65%
0.17%
7.67%
60.69%
39.13
1.33%
11.43%
33.56
1.34%
12.47%
7.39
0.25%
2.16%
8.27
0.33%
3.07%
31.26
0.56
7.81
43.48
1.06%
0.02%
0.27%
1.48%
9.13%
0.16%
2.28%
12.70%
16.49
0.56
3.43
43.48
0.66%
0.02%
0.14%
1.73%
6.13%
0.21%
1.28%
16.15%
129.63
342.32
2938.50
4.41%
11.65%
37.87%
100.00%
105.80
269.16
2511.44
4.22%
10.72%
39.31%
100.00%
i. Core Capital
a. Paid-up Capital
b. Share Premium
c. Statutory Reserve
d. General Reserve
e. Dividend Equalization Account
f. Retained Earnings
Total Core Capital
ii. Supplementary Capital
g. General Provision on UC Investment
h. General Provision on Off Balance Sheet
Item
i. Assets Revaluation Reserves (50)%
j. Exchange Equalization Account
k. Revaluation Reserves of securities
l. Mudaraba Perpetual Bond
Total Supplementary Capital
Total Capital/Equity
Total Risk Weighted Assets
ISLAMI
BANK BANGLADESH
LIMITED
Islami Bank Bangladesh Limited : At a glance
Million US$
Particulars 2000 2005 2009
Share to
Country
Share to
Total Islamic
Banks
National
Rank 2009
1st
Deposit
466
1562 3540
9%
51%
Investment
398
1408 3272
9%
52%
Import
367
1080 2337
11%
49%
Export
245
524
1542
12%
40%
Remittance
111
536
2822
28%
85%
position in
Import
Export
Remittance
&
Operating
Profit
ISLAMI
BANK BANGLADESH
LIMITED
Islami Bank Bangladesh Limited : At a glance
Particulars
Deposit account Holder
Investment account Holder
2009
4,591,463
80,471
Total number of branches of IBBL
232
All Bank Branches in Bangladesh
7152
Islamic Banks Branches
Conventional Banks Islamic Branches
Full-fledged Islamic Bank
497
21
8
Foreign Correspondents of IBBL
919
Correspondent Banks of IBBL
295
ISLAMI
BANK BANGLADESH
LIMITED
Mode wise Investment of IBBL
Amount in Million Dollar
Mode
2009
2008
Amount
% to Total
Investment
Amount
% to Total
Investment
Bai-Murabaha
1698
54.60%
1394
53.44%
Hire Purchase Under
Sirkatul Melk
1071
34.42%
915
35.08%
Bai-Muazzal
106
3.41%
95
3.64%
Purchase& Negotiation
164
5.26%
148
5.68%
Quard
41
1.32%
31
1.19%
Bai- Salam
30
0.97%
25
0.95%
Musharaka
1
0.02%
1
0.02%
3110
100.00%
2609
100.00%
Total
ISLAMI
BANK BANGLADESH
LIMITED
Economic Purpose-wise Investment of IBBL
Real Estate,
4.23%
Transport,
1.65%
Trade , 31.87%
RDS, 1.78%
Other Special
Schemes,
1.18%
Others , 3.43%
INDUSTRY ,
52.34%
AGRICULTUR
E & AGRO
INDUSTRY,
3.53%
ISLAMI
BANK BANGLADESH
LIMITED
Rural Development Scheme (RDS) : At a glance
Particulars
No of Village
No. of Member
May, 2010
National Rank
10800
4
500154
th
Disbursement (Million US$)
394
position
Out of
Outstanding (Million US$)
62
1500
Rate of Recovery
Members Savings (Million US$)
99%
23
MFI
of the
Country
ISLAMI
BANK BANGLADESH
LIMITED
IBBL’s International Affiliation
Member, Accounting and Auditing Organization for Islamic Financial
Institutions, Bahrain.
Member, General Council for Islamic Banks and Financial Institutions, Bahrain
Member, International Chamber of Commerce, (Bangladesh Chapter)
Member, International Islamic Conciliation and Commercial Arbitration
Centre, UAE
Member, International Islamic Financial Market (IIFM), Bahrain
Member, Islamic Financial Services Board (IFSB), Malaysia
ISLAMI
BANK BANGLADESH
LIMITED
IBBL’s National Affiliation
Member, Bangladesh Institute of Bank Management (BIBM)
Member, The Institute of Bankers, Bangladesh (IBB)
Bangladesh Association of Banks (BAB)
Bangladesh Foreign Exchange Dealers’ Association (BAFEDA)
Central Shariah Board for Islamic Banks In Bangladesh
Islamic Banks’ Consultative Forum (IBCF)
Dhaka Chamber Of Commerce & Industry (DCCI)
ISLAMI
BANK BANGLADESH
LIMITED
Special Features of IBBL’s Performance
IBBL is Recognized as the Best Bank in National and International
Level.
National Best Corporate Award 2007 By Institute of Cost
Management and Accountant Bangladesh.
‘Global Finance’ A New York Based Financial Magazine, Named
IBBL as the Best Bank of the Country for 2009,2008,2007,2005,
2000 & 1999.
‘Bank Watch’ A New York Based International Credit Rating
Agency recognized IBBL as the Market Leader.
ISLAMI
BANK BANGLADESH
LIMITED
Corporate Social Responsibility
Bangladesh Bank issued a circular No. DOS. 01 dated 1 June 2008 regarding
guidelines for mainstreaming Corporate Social Responsibility (CSR) in
banks and financial institutions.
Accounting and Auditing Organization for Islamic Financial Institutions
(AAOIFI) also formulated the same as their Governance Standard No. 7 of
which IBBL is obliged to follow as the member of their charter.
Islami Bank Bangladesh Limited being one of the most important corporate
citizen of the country, has been discharging its responsibilities to the society
in general, both directly through its mainstream operations as well as
indirectly through its fully owned subsidiary ‘Islami Bank Foundation’ since
inception.
ISLAMI
BANK BANGLADESH
LIMITED
Corporate Social Responsibility
As per guidelines of the Central Bank, CSR practices of the Bank are
categorized as follows:
CSR practices within the organization.
Scrutinizing environmental and social impact of the projects financed/to be
financed by the Bank.
Reaching out with financial services to the less fortunate segments of the
community.
Community investment by way of donations.
ISLAMI
BANK BANGLADESH
LIMITED
Corporate Social Responsibility
Islami Bank Medical College
6 Modern Hospitals and 8 Community Hospitals
5 Vocational Institutes named Islami Bank Institute of Technology
Islami Bank Physiotherapy and Disabled Rehabilitation Centre
Distressed Women Rehabilitation Centre
Islami Bank International School and College
Service Centre for vulnerable people
Monorom Islami Bank Crafts & Fashions
Other Activities
Scholarship to the poor and meritorious students
Grant for Medical treatment
Grant for sustenance & marriage
ISLAMI
BANK BANGLADESH
LIMITED
Ratings
Rating Agency : Credit Rating Information and Services Limited (CRISL)
Basis of Rating:
Long-term
‘AA+’
Short-term
‘ST-1’
Wide Branch Network,
Strong Market Share,
Stable Customer Deposit Base,
Diversified and Innovative Product Line,
Experienced Management Team,
Contribution to Corporate Social Responsibility,
Good Financial Performance,
Good Asset quality,
Comfortable liquidity position and low cost of fund.
ISLAMI
BANK BANGLADESH
LIMITED
Conclusion
Islamic banks in Bangladesh have become, to an extent, successful
in the field of savings and investment mobilization. As a result, the
growth of Islamic banking in terms of branch expansion was evident
not only in Islamic banking companies but also in Traditional
banking companies.
Islamic banking is growing well in terms of resource mobilization.
These indicate that premises of Islamic banking system in
Bangladesh have become stronger, although Islamic-banking system
is working side by side with Traditional banking system.
The banking system of the country will forward towards Islamic
banking system in future and it is really promising for other
countries.
ISLAMI
BANK BANGLADESH
LIMITED
Recommendation
In order to remove misconception about Islamic banking from the
minds of bankers and customers, there is no alternative to publicity,
research and training of Islamic banking practices. Research should
focus on the development of financial products that conform to
Islamic Sharia, and training should be given to bankers, potential
researchers and bank customers.
ISLAMI
BANK BANGLADESH
LIMITED