Islamic Banking Governance Framework
Shariah law governs all economic and social activities and undertakings of Muslims and is derived from the “Qur’an and Sunnah which are the sayings practices of Prophet Mohammed”. According to Shariah law, the Islamic Financial system aims to enhance the economy of the country through purchasing and selling of physical assets (investment activities) which is considered one of the main principles of Shariah law.
The Shariah Supervisory Board (“SSB”) is the Bank’s main Shariah governance body comprising of three prominent Shariah Scholars. The SSB operates in accordance with the requirements of the CBUAE and exercises their supervisory authority in accordance with the Islamic Jurisprudence (Fiqh al Muamalat) to ensure that all Islamic banking operations and activities are conducted in line with appropriate Shariah standards. The Bank’s Islamic Banking operation regularly seeks the guidance of the SSB on matters relating to Shariah. The work of the SSB covers various Islamic banking products, services and transactions offered by the Wholesale Banking, Consumer Banking, Treasury and Global Markets, ADNIF and Aseel Finance.
The Bank’s Shariah Governance Framework (“SGF”) was revised and updated during the course of 2016 and these operate in full compliance with the best practice guidelines issued by the UBF. The SGF contains the key governing principles pertaining to the Islamic Banking window operations such as appointment of the Shariah Board, the responsibilities of the Head of Islamic Banking, the roles of the Internal Shariah Unit and relevant covenants towards regulatory adherence and the collective accountability of various stakeholders within the SGF.