Islamic Finance – Coverage of Shari’ah compliance
Coverage of Shariah Compliance include: Risk management Recovery and restructuring IT solutions Accounting treatment Legal documentation Product design and structure Shari'ah compliance extends beyond a product's structure and design to take into account other pertinent factors. For instance, a product's product offering may be legal and compliant, but it may also incorporate a risk management tool that is not, such as an interest rate swap to protect against any asset liability mismatch of the bank. In this situation, the risk management tool would need to meet the same Shari'ah compliance criteria, which might call for using a profit rate swap rather than an interest rate swap.
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