Islamic Treasury & Risk Management Products

Course Info

Length: 1 Week

City: Kuala Lumpur

Type: In Classroom

Available Dates

  • May-27-2024

    Kuala Lumpur

  • June-24-2024

    Kuala Lumpur

  • July-29-2024

    Kuala Lumpur

  • Aug-26-2024

    Kuala Lumpur

  • Sep-30-2024

    Kuala Lumpur

  • Oct-28-2024

    Kuala Lumpur

  • Nov-25-2024

    Kuala Lumpur

  • Dec-30-2024

    Kuala Lumpur

Dates in Other Venues

  • May-27-2024

    Istanbul

  • June-03-2024

    Paris

  • June-03-2024

    Singapore

  • June-10-2024

    Dubai

  • June-10-2024

    Barcelona

  • June-17-2024

    London

  • June-17-2024

    Amsterdam

  • June-24-2024

    Istanbul

  • July-01-2024

    Singapore

  • July-01-2024

    Paris

  • July-08-2024

    Barcelona

  • July-08-2024

    Dubai

  • July-15-2024

    London

  • July-15-2024

    Amsterdam

  • July-22-2024

    Istanbul

  • July-22-2024

    Singapore

  • July-29-2024

    Paris

  • Aug-05-2024

    Singapore

  • Aug-05-2024

    Paris

  • Aug-12-2024

    Barcelona

  • Aug-12-2024

    Dubai

  • Aug-19-2024

    Amsterdam

  • Aug-19-2024

    London

  • Aug-26-2024

    Istanbul

  • Sep-02-2024

    Paris

  • Sep-02-2024

    Singapore

  • Sep-09-2024

    Barcelona

  • Sep-09-2024

    Dubai

  • Sep-16-2024

    Amsterdam

  • Sep-16-2024

    London

  • Sep-23-2024

    Singapore

  • Sep-23-2024

    Istanbul

  • Sep-30-2024

    Paris

  • Oct-07-2024

    Paris

  • Oct-07-2024

    Singapore

  • Oct-14-2024

    Dubai

  • Oct-14-2024

    Barcelona

  • Oct-21-2024

    Amsterdam

  • Oct-21-2024

    London

  • Oct-28-2024

    Istanbul

  • Nov-04-2024

    Paris

  • Nov-04-2024

    Singapore

  • Nov-11-2024

    Dubai

  • Nov-11-2024

    Barcelona

  • Nov-18-2024

    London

  • Nov-18-2024

    Amsterdam

  • Nov-25-2024

    Istanbul

  • Dec-02-2024

    Paris

  • Dec-02-2024

    Singapore

  • Dec-09-2024

    Barcelona

  • Dec-09-2024

    Dubai

  • Dec-16-2024

    London

  • Dec-16-2024

    Amsterdam

  • Dec-23-2024

    Singapore

  • Dec-23-2024

    Istanbul

  • Dec-30-2024

    Paris

Course Details

Course Outline

5 days course

The Nature of Money & Implication on Treasury

  • The rules of Sarf and contract
  • Riba Al-Nasiah
  • Discussion: identifying assets that may be traded or
  • pledged from a Sharia’a perspective
  • Overview of traditional Money Market activities:
  • Deposit & Interbank transactions
  • Tradable Instruments
  • Repo

 

Key Islamic Depository Tools

  • Summary rules for non-remunerative deposits:
  • Qard/Wadiah deposits
  • Summary rules for remunerative deposits:
  • Mudarabah deposits
  •  Wakalah deposits
  • Murabaha deposits
  • Traditional Intrabank Relationship: Fund Transfer Pricing
  • (FTP), Inter branch Pricing (IBP) etc
Main Islamic Interbank Tool
 

●     Murabaha vs. Tawarruq vs. Reverse Murabaha - is there any difference?
●     Shari'a concerned about this tool
●     Brokers, OTC and live warrants
●     Breakage, Back value and compounding
●     Suq al Sila - Murabaha and Tawarruq in Malaysia
●     Standardized documents: IIFM, AIBIM
●     Leakage of Islamic funds - what is this? How do different markets deal with this?

 

Other Islamic Interbank Tool


●     Wakalah to do Murabaha vs. Investment Wakalah - what’s the difference?
●     Case study: Investment Dar vs. Blom Interbank Wakalah
●     Interbank Mudarabah
●     Wadiah for hibah & Wadiah for points

Tradable Instruments

  • A brief review of traditional tradable tools:
  • Certificate of Deposits
  • Government Securities (T-Bills etc)
  • Banker’s Acceptance
  • Commercial Papers
  • Quotation basis: yield vs. discount
  • Does the Islamic market have alternatives for all the tools above?

 

Introduction to Sukuk - alternative Islamic tradable instruments

 

  • Short term, high grade issuance for Basel III:
  • Central Bank of Bahrain Salam Sukuk
  • Short term Sukuk Ijarah
  • Are these instruments freely tradable in the secondary
  • market?
  • Longer-Term Sukuk
  • Common structures: Ijarah, Istithmar
  • Asset-based vs. Asset-backed Sukuk
  • Tradability - Shari'a guideline
  • Tenure: Malaysia vs. Global
  • Pricing: Fixed-rate vs. Floating Rate Sukuk

 

Repo

  •  Understanding a conventional repo
  •  Why are Repos not widely used in the Islamic market?
  • How could an Islamic repo work?
  • The IIFM solution
  • Alternative solutions
Managing FX Risk 


● Shari'a compliant forward alternatives:
» Promise based solutions - unilateral promise, two
unilateral promises vs. bilateral promises
» Promise to deposit i.e. Cross Currency Deposit
» Are these solutions on the balance sheet or off-balance
sheet?
» Exiting these forward?
● How do Islamic banks hedge themselves?
» Long Murabaha
» Back to back promise
Group Exercise: Examine a traditional FX Swap & construct a
Sharia’a compliant FX Swap

 

Managing FX Risk II
 

● Sharia’a tools that provide options:
» Arbun
» Promises
» Juala
● How do we use the above to structure Shari'a compliant
currency options?
» Arbun - is the arbun for currency?
» Promises - how do we structure the option premium?
» Which solution is widely used?
● Calculating effective and break-even strike rate
● Are the options tradable?
Group Exercises:
1. How to use Tawarruq for Currency Option?
2. Are the following FX Risk Management Strategies
replicable in the Islamic market?
i. Put Option
ii. Put Spread

Managing Rate Risk 
 

● Shari'a analysis of the following traditional tools for interest
rate risk management
» Forward Rate Agreement (FRA)
» Interest Rate Futures
» Swaps - Interest Rate Swap (IRS) and Cross Currency
Swap (CCS)
» Interest Rate Options
Group Discussion: Are the following Interest Rate Option
Strategies replicable in the Islamic market?
i. Interest Rate Cap
ii. Interest Rate Floor
iii. Interest Rate Collar

Course Video