Standardisation of Mudaraba Contracts to be discussed at WIBC 2005

The Islamic Development Bank (IDB) will participate as the Multilateral Strategic Partner in WIBC that takes place in the Kingdom of Bahrain from 10-12 December 2005.

Headquartered in Jeddah, Saudi Arabia, and comprising four members, the IDB Group consists of the Islamic Development Bank (the flagship of the Group), Islamic Research and Training Institute, (IRTI), Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), and the Islamic Corporation for the Development of the Private Sector (ICD).

Dr. Ahmed Mohammed Ali, President of the Islamic Development Bank (IDB), said: "By way of our participation in WIBC we are fulfilling one of our objectives, which is to enhance and support the development of Islamic banking and finance. The IDB Group uses modes of finance that are Shari'ah compatible for our operations."

This year's WIBC will feature pre-conference briefings on Dec 10 and eight conference sessions over the next two days. Focussing on the conference theme, "Unlocking Market Opportunities - Consolidation, Innovation and Growth", interactive sessions will feature presentations on topical issues as well as panel discussions.

On December 11 the focus of a session, titled Addressing the Challenges of Market Development and Risk Management, will be the standardisation of Mudaraba contracts. This session will feature presentations from the Bahrain Monetary Agency (BMA) and the London Metal-Exchange (LME). The two institutions have an ongoing cooperation - on developing contracts and documents which can be used by Islamic financial institutions (IFIs) for conducting transactions in metals also traded on the LME.

"The need for standardization in the global Islamic banking and finance industry cannot be stressed enough," said Anwar Khalifa Al Sadah, Executive Director, Financial Institutions Supervision, at the BMA, who will represent the BMA at the special session. "Through cooperation with such global partners as the LME, the BMA hopes to strengthen the global Islamic banking industry, enhance the ability of IFIs to trade in international markets and improve business volumes," he added.

While Anwar Al Sadah's presentation will focus on the BMA's initiatives in standardizing Mudaraba contracts as well as future prospects, Simon Heale, Chief Executive Officer, of the LME will highlight the Exchange's role in the area of Islamic finance and provide an insight on trading on the LME.

Other topics which will be discussed during the session include Basel II - Challenges Ahead for Islamic Banks and Challenges of Islamic Financial Market Development.