Corporate Finance Product

Financing products and documentary credit services provided by the bank to the clients includes the following:

Ijarah (Lease) and Ijarah Muntahiyah bi Tamleek (Lease ending in ownership)

Ijarah means leasing of property pursuant to a contract under which a specified permissible benefit in the form of a usufruct is obtained for a specified period in return for a specified permissible consideration. One of the forms of Ijarah used by Islamic financial institutions is Ijarah Muntahiyah bi Tamleek.  This is a form of leasing contract which includes a promise by the lessor to transfer the ownership in the leased property to the lessee, either at the end of the term of the Ijarah period or by stages during the term of the contract, such transfer of the ownership being executed through the standard means.

Murabaha to the purchase orderer

The type of transaction, which involves the customer's promise to purchase the item from the institution, is called Murabaha to the purchase orderer. By this it is distinguished from the normal type of Murabaha which does not involve such a promise by the customer. The Murabaha to the purchase orderer is the sale of an item by the institution to a customer (the purchase orderer) for a pre-agreed selling price which includes a pre-agreed profit mark-up over its cost price, this having been specified in the customer's promise to purchase.  Normally, a murabaha to the purchase orderer transaction involves the institution granting the customer a murabaha credit facility. A murabaha to the purchase orderer transaction typically involves deferred payment terms, but such deferred payment is not one of the essential conditions of such transaction. A Murabaha can be arranged with no deferral of payment, in which case the mark-up will only include the profit the institution will receive for a spot sale and not the extra charge it will receive for deferral of payment.


Istisna'a is a contract of sale of specified items (before they come into existence) to be manufactured or constructed, with an obligation on the part of the manufacturer or builder (contractor) to deliver them to the customer upon completion.

Musharaka (Participation)

It is an agreement between two or more parties to combine their assets or to merge their services, obligations and liabilities with the aim of making profit.


It is a type of partnership in profit in which one party (rab al mal) provides the capital and the other party (mudarib) provides work (expertise and management).

Letters of Credit

Letters of Credit are written commitments from a bank (called the issuing party) delivered to the seller (beneficiary), at the request of the buyer (applicant or orderer) in line with his/her instructions, or  issued by the bank on behalf of itself. This is intended to pay (in cash, accept a bill or deduct a bill) a specified amount within a certain limit during a certain period, provided that the documents of the goods are delivered in line with the instructions.

Letters of Guarantee

Letters of Guarantee are written commitments whereby the bank pledges to guarantee a customer (applicant of the issue) a specified amount within a certain limit to a third party, guaranteeing that such customer will pay his obligations to the third party within a certain period. Under the letter, the bank pays the secured amount when the third party makes the first claim during the validity of the letter of guarantee, regardless of opposition expressed by the client.

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