FINA 4351: Special Topics in Finance Leena Al-Shibil 200900172 Islamic Banking FINA 4351: Special Topics in Finance Leena Al-Shibil 200900172

Outlines Overview of Islamic Banking Status of Islamic Banking Globally In Saudi Arabia Islamic Banking products In general By Ryad Bank My assessment Summary

Overview of Islamic Banking Introduce products and services Qura’an, Sunnah, Ijma’, Qyas By qualified Islamic scholar Major Source Solving arising issues Istehsan, Isteslah, Ijtehad, Orf By community Minor Source Does not involve prohibited activities Does not involve uncertainty risk Does not involve interests Rules

Status of Islamic Banking (Globally) Islamic Banks The first appearance of Islamic banking system businesses was in Egypt back in the 1960s. Since then, Islamic banking start expanding in Egypt and other countries. By the years of 1980s Islamic banking came into existence in the western and other non-Islamic countries. Today Islamic banking is worth US$1.1 trillions worldwide. Tops Islamic banks have recently a growth rate of 20%, while conventional banks’ growth rate is about 9%.

Status of Islamic Banking (In Saudi Arabia) Islamic Banks Conventional Banks Mixed Operations Banks Fully Islamic Banks Islamic Banks AlRajhi Bank Alinma Bank AlBelad Bank Aljazeerah bank Mixed Operations Banks Riyadh Bank SABB SAMBA SHB NCB Saudi Fransi Bank

Islamic Banking Products In General By Ryad Bank Wadiah Modharabah Mosharkah Morabaha Bai’ Bethaman Ajil Qard Hasan Ijarah Thomma AlBai’ Bai’ AlAiynah Sukok Mortgage Housing Finance Land Finance Personal Finance Finance w/o Salary Transfer Tawarrug Finance Murabaha Finance Finance Against Securities Auto Leasing Corporate Customers Financing Investment Solutions

My Assessment Argument 1 The principles’ the bank uses Argument 2 Dealing with non-Islamic banks Argument 3 Riba and current currency

Summary Islamic banking is based on the law of shari’a. It should not involve Riba transactions, or Haram activities, or uncertainty risk (Gherar) Islamic banks today have higher growth rate than conventional banks In Saudi Arabia banks are divided into 2 sections; Islamic banks, and mixed operations banks Riyadh bank has fully Islamic branches that offer deposit, loan, and investment products prophet Mohammed said, “Leave what makes you doubt to what does not make you doubt”

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