1. The bank requires to retain 10% of
its total deposit liability as Statutory Liquidity Ration (SLR) including 4%
Cash Reserve Ration (CRR) with Central Bank. The Bank may go for investment
upto 90% of its total deposit. The perspective Investment Plan is being
formulated quantifying the allocation of investments size-wise, sector-wise,
geographical area-wise, economic purpose-wise, security-wise and mode-wise
keeping in vies 20% projected growth of deposit each year.
2. Taking into consideration the broad
objectives of the Bank, national priority, socio-economic need, growth level of
the economy, the investment port-folio of the Bank may gradually be diversified
and allocated in terms of size, sector, geographical area, economic purpose,
security and mode.
THE 5-YEAR PERSPECTIVE
PLAN FROM 2003-2007
In accordance with the investment Policy, 5 year
Perspective Plan from 2003 to 2007 is formulated. Deposit target of the Bank s
on September 30, 2002 plus 10% has been taken as base and 90% of the year-wise
estimated deposits have been as investable fund. Size-wise, sector-wise,
geographical area-wise, economic purpose-wise, security-wise allocation of
estimated investable funds are made in accordance with the weightage given in
the Investment.
Table-12 Distribution of investments by size of
Accounts (in million Tk.)
Year
|
Estimated total
deposit
|
Investable fund (90%
of total deposit)
|
SIZE OF
ACCOUNTS
|
||||||||||
Upto
Tk.0.50m
|
Above
tk.0.50 m to Tk. 1.00m
|
Above
Tk. 1.00m to Tk. 2.50m
|
Above
tk.2.50m to Tk. 5.00m
|
Above
Tk.5.00
|
Total
|
||||||||
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
||||
2003
|
60094
|
54085
|
20
|
10817
|
11
|
5949
|
16
|
13
|
7031
|
7031
|
40
|
21634
|
54085
|
2004
|
72113
|
64902
|
20
|
12980
|
11
|
7139
|
16
|
13
|
8437
|
8437
|
40
|
25961
|
64902
|
2005
|
86535
|
77882
|
20
|
15576
|
11
|
8567
|
16
|
13
|
10125
|
1012
|
40
|
31153
|
77882
|
2006
|
103843
|
93458
|
20
|
19692
|
11
|
10280
|
16
|
13
|
12150
|
12150
|
40
|
37383
|
93458
|
2007
|
124611
|
112150
|
20
|
22423
|
11
|
12336
|
16
|
13
|
14579
|
14579
|
40
|
44860
|
112150
|
Table-13 :
Distribution of Investments by Sectors (Public & Private)
(in million Tk.)
Year
|
Estimated total deposit
|
Investable Fund (90% of total deposit)
|
Public Sector
|
Private Sector
|
Total
|
||
%
|
Amount
|
%
|
Amount
|
||||
2003
|
60094
|
54085
|
5
|
2704
|
95
|
51380
|
54085
|
2004
|
72113
|
64902
|
5
|
3245
|
95
|
61657
|
64902
|
2005
|
86535
|
77882
|
5
|
3894
|
95
|
73988
|
77882
|
2006
|
103843
|
93458
|
5
|
4673
|
95
|
88785
|
93458
|
2007
|
124611
|
112150
|
5
|
5607
|
95
|
106542
|
112150
|
Table-14
: Distribution of investments by areas
(urban & rural) (in million Tk.)
Year
|
Estimated Total Deposit
|
Investable Fund (90% of total deposit)
|
Rural
|
Uraban
|
Total
|
||
%
|
Amount
|
%
|
Amount
|
||||
2003
|
60094
|
54085
|
6
|
3245
|
94
|
50140
|
54085
|
2004
|
72113
|
64902
|
7
|
4543
|
93
|
60358
|
64902
|
2005
|
86535
|
77882
|
8
|
6231
|
92
|
71651
|
77882
|
2006
|
103843
|
93458
|
9
|
8411
|
91
|
85047
|
93458
|
2007
|
124611
|
112150
|
10
|
11215
|
90
|
100935
|
112150
|
Table-15
(A) : Distribution of investments by
Economic Purpose (in million Tk.)
Year
|
Estimated total deposit
|
Investable
(90% of total deposit)
|
ECONOMIC PURPOSE
|
ECONOMIC
PURPOSE
|
|||||||||
Agrculture,
Fishing & Forestry
|
Industry
|
Working
Capital
|
Construction
& Real Estate
|
Electricity,
Gas, Water & Sanitary Services
|
|||||||||
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
11
|
12
|
13
|
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
||||
2003
|
60094
|
54085
|
2
|
1082
|
18
|
9735
|
15
|
8113
|
10
|
5410
|
0.5
|
270
|
|
2004
|
72113
|
64902
|
2
|
1298
|
18
|
11682
|
15
|
9735
|
10
|
6490
|
0.5
|
325
|
|
2005
|
86535
|
77882
|
2
|
1558
|
18
|
14010
|
15
|
11682
|
10
|
7790
|
0.5
|
389
|
|
2006
|
103843
|
93458
|
2
|
1869
|
18
|
16822
|
15
|
14019
|
10
|
9346
|
0.5
|
467
|
|
2007
|
124611
|
112150
|
2
|
2243
|
18
|
20187
|
15
|
16823
|
10
|
11215
|
0.5
|
561
|
|
(B) :
ECONOMIC
PURPOSE
|
|||||
Transport & Communication
|
Storage
|
Trade
|
|||
14
|
15
|
16
|
17
|
18
|
19
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
5
|
2704
|
1
|
541
|
40
|
21634
|
5
|
3245
|
1
|
649
|
40
|
25960
|
5
|
3894
|
1
|
779
|
40
|
31152
|
5
|
4673
|
1
|
935
|
40
|
37383
|
5
|
5608
|
1
|
1121
|
40
|
44860
|
(C)
ECONOMIC PURPOSE
|
|||||||
SPECIAL SCHEME
|
|||||||
Household durable Scheme
|
Small business Investment Scheme
|
Doctors Investment Scheme
|
Poultry & Dairy Investment Scheme
|
||||
20
|
21
|
22
|
23
|
24
|
25
|
26
|
27
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
1.5
|
811
|
1.5
|
811
|
0.5
|
270
|
0.5
|
270
|
1.5
|
974
|
1.5
|
974
|
0.5
|
325
|
0.5
|
325
|
1.5
|
1168
|
1.5
|
1168
|
0.5
|
389
|
0.5
|
389
|
1.5
|
1402
|
1.5
|
1402
|
0.5
|
467
|
0.5
|
467
|
1.5
|
1682
|
1.5
|
1682
|
0.5
|
561
|
0.5
|
561
|
(D)
ECONOMIC PURPOSE
|
Total
|
|||||||
SPECIAL SCHEME
|
Miscellaneous
|
|||||||
28
|
29
|
30
|
31
|
32
|
33
|
34
|
35
|
36
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
|
2
|
1082
|
0.5
|
270
|
1
|
541
|
1
|
541
|
54085
|
2
|
1298
|
0.5
|
325
|
1
|
649
|
1
|
649
|
64902
|
2
|
1558
|
0.5
|
389
|
1
|
779
|
1
|
779
|
77882
|
2
|
1869
|
0.5
|
467
|
1
|
935
|
1
|
935
|
93458
|
2
|
2243
|
0.5
|
561
|
1
|
1121
|
1
|
1121
|
112150
|
Investment
Modes
There are three types of Investment Mechanism which are :
o Bai Mechanism
(Trading Mode)
1.
Bai Murabaha
2.
Bai Muaggle
3.
Bai Salam
4. Bai
Istishna’a
o Ijara Mechanism
(Leasing Mode)
1. Hire
purchase (Ijarah)
2. Hire
purchase under Shirkatul Malk
o Share Mechanisms
1. Mudaraba
2. Musharakah
Detailed
description of Three Investment Mechanism :
Bai Mechanism
(Trading Mode)
1. Bai Murabaha
Meaning
The terms “Bai-Murabaha” have been
derived from Arabic words and (Bai and Ribhun). Te word means purchase and sale and the word means an agreed upon profit “Bai-Murabaha” means sale on agreed upon
profit.
Definition
Bai-Mudarabaha may be defined as a
contract between a buyer and a seller under which the seller sells certain
specific goods (permissible under Islamic Shariah and the Law of the land), to
the buyer at a cost plus agreed profit payable in cash or on any fixed future
date in lump-sum or by installments. The profit marked-up may be fixed in
lump-sum or in percentage of the cost price of the goods.
Types of Murabaha
In respect of dealing parties Bai-Murabaha may be of two
types.
Ordinary Bai-Murabaha
If there are only two parties, the seller and the buyer,
where the seller as an ordinary trader purchases the goods from the market
without depending on any order and promise to buy the same from him and sells
those to a buyer for cost plus profit, then the sale is called Ordinary
Bai-Murabaha.
Bai-Murabaha on Order
and Promise
If there are three parties, the buyer, the seller and the
Bank as an intermediary trader between the buyer and the seller, where the Bank
upon receipt order from the buyer with specification and a prior outstanding
promise to buy the goods from the Bank, purchases the ordered goods and sells
those to the ordering buyer at a cost plus agreed profit, the sale is called
“Bai-Murabaha on Order or Promise”, generally known as Murabana.
This Murabaha upon order and promise is generally used by
the Islami Banks, which undertake the purchase of commodities according to the
specification requested by the Clients and sale on Bai-Murabaha to the one who
ordered for the goods and promised to buy those for its cost price plus a
marked-up profit agreed upon previously by the two parties, the Bank and the
Clients
Important
feature
à It
is permissible for the Client to offer an order to purchase by the Bank
agriculture goods deciding its specification and committing himself to buy the
same from the Bank on Murabaha, i.e. cost plus agreed upon profit.
à It
is permissible to make the promise binding upon the Client to purchase from the
Bank, that is, he is to either satisfy the promise or to indemnify the damages
a caused by breaking the promise without excuse.
à It
is permissible to take cash/collateral security to guarantee the implementation
of the promise or to indemnify the damages.
à It
is also permissible to document the debt resulting from Bai-Murabaha by a
Guarantor, or a mortgage, or both lie any other debt. mortgage /Guarantee /Cash
Security may be obtained prior to the signing of the Agreement or at the time
of signing the Agreement.
à Stock
and availability of goods is a basic condition for signing a Bai-Murabaha
Agreement. Therefore, the bank must purchase the goods as per specification of
the Client to acquire ownership of the same before signing the Bai-Murabaha
agreement with the Client.
à After
purchase of goods the Bank must bear the risk of goods until those are actually
sold and delivered to the Client buyer, the Bank shall bear the consequences of
any damages or defects, unless there is an agreement with the Client releasing
the Bank of the defects, that means, if the goods are damaged, Bank is liable,
if the goods are defective, (a defect that is not included in the release) the
Bank bears the responsibility.
à The
bank must deliver the specified to the Client on specified date and at
specified place of delivery as per Contract.
à The
Bank shall sell the goods at a higher price (Cost + Profit) to earn profit. The
cost of goods sold and profit mark-up therewith shall separately and clearly be
mentioned in the Bai-Murabaha Agreement. The profit mark-up may be mentioned in
lump sum or in percentage of the purchase/cost price of the goods. But, under
no circumstances, the percentage of the profit shall have any relation with
time or expressed in relation with time, such as month, per annum etc.
à The
price once fixed as per agreement and deferred cannot be further
increased.
à It
is permissible for the Bank to authorize any third party to buy and receive the
goods on Bank’s behalf. The authorized must be in a separate contract.
Operational Procedures of Investment Mechanism of IBBL
Ø
Induction of client
Ø
Application
Ø
Categorization (4
categories)
Ø
Processing and
appraisal
Ø
Sanction
Ø
Documentation
Ø
Purchase of goods by
the Bank
Ø
Taking delivery of
goods by the Bank
Ø
Sales and delivery of
goods to the client
Induction of Client
·
Hold
preliminary discussion with the prospective client his investment needs,
business experience, viability of the project and Shariah permissibility of the
assets, the business and the uses of the asset.
·
Brief
him on the salient features of Bai-Murabaha mode of investment.
·
Look
to the past performance of the client.
·
Check-up
Head Office Current investment policy and Branch’s track record of bai-Murabaha
Investment of thie items.
·
If
the proposal is found permissible under Islamic principles and suitable, advise
the client to submit formal Application, if not found suitable, regret
politely.
·
Request
potential client to open an Al-Wadia current Accont. Let him maintain the
Current Account Satisfactorily for a reasonable period. This will generally
mean six months).
Application
·
Obtain
application in Duplicate from the cient on F-167A and record the same in the
investment proposal Received and Disposal Register (B-55). Deal Application
shall be obtained on F-136.
·
Obtain
and affix attested photograph(s) of the Proprietor /Partners /Directors
/Trustee /Administrator on the top right hand corner of the application.
·
Scrutinize
the application of the client to see that :
A. All columns are properly filled in.
B. Particulars information given therein are complete and
correct all respect.
C. All required
Documents /Papers as listed inthe footnote of the application
are submitted.
D. The client as per specimen signature with the Bank
signs it.
Categorisation
Categorize the proposal
as under
Bai-Murabaha Commercial
Investment for Purchase and sale goods to individual
/Firm/Company for Commercial purpose shall be termed as Bai-Murabaha
Commercial.
Bai-Murabaha Industrial
Investment to industrial undertakings in the Form of
Land, Buildings, Machineries, Equipments, Raw Materials, etc. shall be termed
as Bai-Murabaha Industrial.
Bai-Murabaha
Agriculture
Investment to agriculture sector for supply of seeds,
fertilizer etc. shall be termed as Bai-Murabaha Agriculture.
Bai-Murabaha Import
Investment for Import of goods from abroad shall be
termed as Bai-Murabaha Import.
Enter the Application in the “Investment Proposal
Received and Disposal Register (B-53) and allot a Serial Number to it.
Initate action for
Processing and Appraisal immediately.
Processing and Appraisal
·
Examine shariah permissibility of the goods. Reject
the proposal outright, if not permitted by Islamic Sharah.
·
Check-up
Credit Restriction Schedule of Bangladesh Bank and Head Office Current
Investment Policy Guidelines.
·
Visit
the Business establishment of the Client. Talk to the business and important
personalities of the locality to ascertain the Honesty, Integrity and Business
dealings of the Client.
·
Request
for confidential report of the client from local Bank Branches. Confident
Report from Credit Information Bureau (CIB) of Bangladesh Bank through Head
Office Investment Divisioin as per Instruction Circular of Head Office in this
Regard.
·
Optain
Financial Statement/Balance Sheet of the Client for the last three consecutive
years for Investment Proposals of Tk. 50.00 lac or above as per Head Office
Instruction.
·
Inspect
Land, Building, other Assets and Properties proposed to be Mortgaged or
Hypothecated.
·
Forward
Documents, Title Deeds and other relevant Papers to the approves Lawyer of the
Bank for examination and furnishing his opinion.
·
Obtain
Lawyer’s Opinion as per clause No. 8.02.
·
Please
study the following carefully and note down the actual findings in the
Appraisal Form against each item :
à Effective
demand, price of the goods, Short or long-term duration, quality and other
specifications of the goods, availability, etc. of the said or projected goods.
·
Where
sale price of the goods is payable by the client at specified future date in
lump sum or installments as per proposal.
·
For
Bai-Murabaha Commercial and Bai Murabaha Industrial Investment, prepare
Appraisal Report on F-167B. For appraisal Bai-Murabaha agriculture and For
Bai-Murabaha Import use special Appraisal Form devised for each of those, if
any, otherwise F-167B providing the available/required supplementary
information. In course of preparation of the appraisal report please ensure
incorporation of all information of all information, particulars figures and
statistics in Appraisal Form correctly with special attention to the following
:
à Composition of
asset of the Client, extent and nature of liabilities of the Client, the value
of Liquid Assets, Business Reputation of the Clientk experience of the Client,
etc.
·
Contact
primarily with the producers/sellers/suppliers of the goods in the market, study
the market price and work out the purchase and sale prices of the goods as per
guidelines.
Sanction
·
On
completion of Appraisal as provided herein above, of the Proposal is found
viable, issue Sanction Advice (F-188) if it is within the business power of the
Branch mentioning all the terms and condition is duplicate to the Client and
endorse copies to Zonal and Head Offices retaining one copy in the Clien’ts
file duly accepted by the Client.
·
If
the proposal is not within the Discretionary Power of the Branch, the Branch
shall with Appraisal Report on F-167A and F-167B to Zonal Office/Head Office.
·
If
the proposal is within the Business Power of the Zonal Office, Zonal Office
shall accord Approval /Regret the Proposal.
·
If
the proposal is not within the Business of the Zonal Office shall forward the
proposal to Head Office with their views and recommendations.
·
On
receiving the proposal and the Appraisal Report along with supporting papers
Head Office will either approve or Regret.
·
If
the Branch/the Zonal Office /Head Office, the branch will issue the Sanction
advice (F-188) with a copy to Zo/HO duly recorded in /Facility Sanctioned
Register (B-119) with authority to the investment Client for the limit.
·
If
the client duly accepts the sanction terms and conditions, enter the
particulars of the sanctioned proposal in the limit Register (B-117) allotting
a Fixed Serial number for each Client as per Limit Register which shall remain
permanent irrespective of the mode(s) so long the Client continues business
with the Bank.
·
Open
file Client-wise, affixing the Fixed Number allotted to him as per Limit
Register (B-117) and Client’s name,
address, telephone number be recorded prominently in the inner side of the
investment File for easy tracing in case of need.
·
In
case of investment to the existing Client, obtain required papers, document
with the past performance and outstanding liabilities of the Client, if any and
process of sanction the propsal as per instruction laid down here-in-above
after due evaluation or study.
Documentation
Before purchasing the asset/property by the Bank, obtain
sufficient collateral securities as mentioned in the sanction advice along with
the following charges documents properly executed, i.e. duly filled in, sighed,
stamped, verified and witnessed where necessary :
·
Bai-Murabaha
Sanction Advice (F-188) deal-wise duly accepted by the Client.
·
Bai-Murabaha
(Deal-Wise) (AF-1).
·
Joint
and Several D.P. Note (CF-2).
·
Single
party D.P. Note (CF-1), if there is no guarantor.
·
Double
Party D.P. Note (CF-2), if there is guarantor(s) to be made by the Client in
favor of the guarantor and endorsed by the later to the Bank.
·
D.P.
Note Delivery Letter (CF-3).
·
Letter
of Hypothecation (CF-5) for the asset(s) and Client’s stock in Trade
/Work-in-Process.
·
Letter
of Disclaimer (CF-15), if the goods are
stored in Client’s /party’ own/hired godown.
·
Agreement
for Pledge of Goods (CF-4).
·
Insurance
Policy (if stored in Client’s /Party’s Godown /Yard under Bank’s effective
control duly recorded insurance Register (B-39).
·
Letter
of Gurantee (CF-14).
·
Balance
Confirmation Letter (CF-16)
·
Trust
Receipt (CF-11).
·
Letter
of Installments (CF-17).
If the Investment is made collaterally secured by
Mortgage of property, obtain the following :
·
In
case of Equitable Mortgage, Memorandum of Deposit of Title Deed (MDTD) signed
by the owner of the property.
·
In
case of Legal Mortgage, Registered Deed should be obtained.
·
Personal
Guarantee of the onner(s) of the properly on CF-14.
·
Original
title Deed(s) with CS, RS, SA, Mutation Parcha, DCR of the property and
Mutatioin record.
·
Upto-date
Rent Receipt.
·
Non-encumbrance
Certificate along with Search Fee Paid Receipt of the concerned Registry
Office.
·
Site
Plan (Map-Naksha) of the Mortgaged Property.
·
Valuation
Certificate issued by a competent Engineer and physically verified by the
Branch Officials.
·
Lawyer’s
Certificate
·
An
affidavit sworn.
Where the Investment is secured by Hypothecation of
Stock-in-trade, Machineries etc. also obtain the following Documents :
·
Letter
of Hypothecation (CF-5).
·
Trust
Receipt (CF-11).
·
Legal
Mortgage of Machineries.
In case investment is collaterally secured by pledge of
Shares of reputed Public Limited Company on bank’s approved list and quoted in
the stock Exchange, the following additional document are to be obtained :
·
Agreement
for Pledge of Shares.
·
Share
Transfer Deed in Duplicate.
·
Share
Delivery Letter
·
Letter
to the concerned Company to register Lien in Bank’s Favor.
In case of investment to Partnership Firms, obtain the
following Document :
·
Letter
of Partnership
·
Copy
of Partnership Deed
In case of investment to Private or Public Limited
Company, obtain the following Document :
·
Certified
copy of the Memorandum and Articles.
·
Resolution
of the Board of Directors.
·
Personal
Guarantee of all the Directors.
·
Certificated
of Incorporation
·
Certificated
of Commerncement
In case of investment to a Trust Organization, obtain the
following Document :
·
Copy
of Trust Deed.
·
Resolution
of the Board of Trustees
·
Charge
Document
·
Personal
Guarantee of the Office Bearer
In case of investment to Co-operative Society, obtain the
following Document :
·
Clearance
from the Registrar
·
Letter
to be issued to the concerned Registrar
·
Personal
Guarantee of the Office Bearer
·
A
copy of Bye-laws of the Society.
Signature of the Client
After completion
of Document, enter Document in Documents Execution Register (B-103).
Movement of Document, if any, should be duly recorded in
the Document Ex-custody Register duly singed by the Custodians.
Purchase of Goods by The Bank
Remember that Bai-Murabaha is perfectly a ligitimate
transaction according to the Shariah, provided :
v That the goods desired by the Client
is first purchased by the Bank and the ownership of the Bank on the goods is established, i.e.
Bank must transform its money into goods.
v That after purchase of the goods, the
risk of the goods is borne by the Bank until the possession of the Merchandise
has been passed on the Client.
v That the specification of the goods,
delivery schedule and other terms of contract are fulfilled.
·
Obtain
deal-wise application Order for Purchase on F-136 after due study.
·
Open
investment account in Investment Account Opening Register (B-102).
·
Enter
the Account Particulars in the Investment Ledger (B-105).
·
It
should be carefully noted that purchase of goods shall be made only after
completion of all the Documentation formalities, including Pre-Audit memo
(F215).
·
In
case purchase of Bai-Murabaha goods by the Bank on Ceredit/deffered payment
basis, the Bank shall execute a Credit Purchase Agreement with the seller to
that effect mentioning date of delivery of Goods to the bank and that of
payment by the Bank.
·
If
the goods are to be purchased from the local or outstation market and money is
to be paid/remitted thereof and other expenses such s TA/DA, transportation
etc, shall be borne by the Bank, which shall ultimately be loaded on the cost
of Goods.
Taking Delivery of Goods by the Bank
·
After
finalization of purchse of Bai-Murabaha Goods either by the Bank officials or
through any Agent from the local or out station market the Bank shall request
the seller to delivery the goods purchased to the Bank’s Authorized official
/Agent or to the Bank godown against proper acknowledgement.
·
After
taking delivery of the goods by the Bank or trough and Agent, the Bank shall
make payment of the price of the goods to producers /sellers /supplier through
DD/TT/PO against Cash memo which will exclusively be issued in the name of the
Buying Agent.
·
The
Bank shall not be invest in such cases where the allotting Authority will not
accept the Letter of Authority and agree to deliver the goods to the Bank as
per authorization of this Allottee.
Sale and Delivery of Goods to the client
The Bank after receiving the goods shall finally
calculate the Total Cost price and fix up the sale price by mutual discussion
with Client (MANUAL, IBTRA).
2.
Bai - Muajjal
Meaning
The terms “Bai” and “Muajjal” have been derived from
Arabic words and . The word means purchase and sale and the word means a fixed time or a fixe period.
“Bai-Muajjal”
means sale for which payment is made at a future fixed date or within fixed
period. In short, it is a sale on Credit.
Definition
Bai-Muajjal may be defined as a
contract between a buyer and a seller under which the seller sells certain
specific goods (permissible under Islamic Shariah and the Law of the Country),
to the buyer at a cost plus agreed profit payable in cash or on any fixed
future date in lump-sum or by installments. The seller may also sell the goods
purchased by him as per order and specification of the Buyer.
Induction of Client
·
Hold
preliminary discussion with the prospective client his investment needs,
business experience, viability of the project and Shariah permissibility of the
assets, the business and the uses of the asset.
·
Brief
him on the salient features of Bai-Murabaha mode of investment.
·
Look
to the past performance of the client.
·
Check-up
Head Office Current investment policy and Branch’s track record of bai-Murabaha
Investment of thie items.
·
If
the proposal is found permissible under Islamic principles and suitable, advise
the client to submit formal Application, if not found suitable, regret
politely.
·
Request
potential client to open an Al-Wadia current Accont. Let him maintain the
Current Account Satisfactorily for a reasonable period. This will generally
mean six months.
·
After
purchase of goods the Bank must bear the risk of goods until those are acutally
sold and delivered to the Client, i.e. after purchase ofthe goods by the Bank
and before selling of those on “Bai-Muajjal” to the Client buyer, the Bank
shall bear the consequences of any damages or defects, unless there is an
agreement with the Client releasing the Bank of the defects.
Application
·
Head
Office controlled Branches shall obtain application from the Client in Duplicate.
Branches under Zone shall obtain application from the Client it Triplicate. For
new Client and renewal cases, applciation shall be obtained on F-167A. Deal
application shall be obtained on F-136.
·
Obtain
and affix attested photograph.
·
Proprietor
/Partners /Directors /Trustee /Administrator on the top right hand corner of
the application.
·
Scrutinize
the application of the client to see that :
A. All columns are properly filled in.
B. Particulars information given therein are complete and
correct all respect.
C. All required
Documents /Papers as listed inthe footnote of the application
are submitted.
D. The client as per specimen signature with the Bank
signs it.
Categorisation
Categorize the proposal
as under
“Bai-Muajjal”
Commercial
Investment for Purchase and sale goods to individual
/Firm/Company for Commercial purpose shall be termed as Bai-Murabaha
Commercial.
Bai-Muajjal Industrial
Investment to industrial undertakings in the Form of
Land, Buildings, Machineries, Equipments, Raw Materials, etc. shall be termed
as Bai-Murabaha Industrial.
Bai-Murabaha Agriculture
Investment to agriculture sector for supply of seeds,
fertilizer etc. shall be termed as Bai-Muajjal Agriculture.
Bai-Muajjal Import
Investment for Import of goods from abroad shall be
termed as Bai-Muajjal Import.
Enter the Application
in the “Investment Proposal Received and Disposal Register (B-53) and allot a
Serial Number to it
Initate action for
Processing and Appraisal immediately.
Processing and Appraisal
·
Examine shariah permissibility of the goods. Reject
the proposal outright, if not permitted by Islamic Sharah.
·
Check-up
Credit Restriction Schedule of Bangladesh Bank and Head Office Current
Investment Policy Guidelines.
·
Visit
the Business establishment of the Client. Talk to the business and important
personalities of the locality to ascertain the Honesty, Integrity and Business
dealings of the Client.
·
Request
for confidential report of the client from local Bank Branches. Confident
Report from Credit Information Bureau (CIB) of Bangladesh Bank through Head
Office Investment Divisioin as per Instruction Circular of Head Office in this
Regard.
·
Optain
Financial Statement/Balance Sheet of the Client for the last three consecutive
years for Investment Proposals of Tk. 50.00 lac or above as per Head Office
Instruction.
·
Inspect
Land, Building, other Assets and Properties proposed to be Mortgaged or
Hypothecated.
·
Forward
Documents, Title Deeds and other relevant Papers to the approves Lawyer of the
Bank for examination and furnishing his opinion.
·
Obtain
Lawyer’s Opinion as per clause No. 8.02.
·
Please
study the following carefully and note down the actual findings in the
Appraisal Form against each item :
à Effective
demand, price of the goods, Short or long-term duration, quality and other
specifications of the goods, availability, etc. of the said or projected goods.
·
Where
sale price of the goods is payable by the client at specified future date in
lump sum or installments as per proposal.
·
For
Bai-Muajjal Commercial and Bai-Muajjal Industrial Investment, prepare Appraisal
Report on F-167B. For appraisal Bai-Muajjal agriculture and For Bai-Muajjal
Import use special Appraisal Form devised for each of those, if any, otherwise
F-167B providing the available/required supplementary information. In course of
preparation of the appraisal report please ensure incorporation of all
information of all information, particulars figures and statistics in Appraisal
Form correctly with special attention to the following :
à Composition of
asset of the Client, extent and nature of liabilities of the Client, the value
of Liquid Assets, Business Reputation of the Clientk experience of the Client,
etc.
·
Contact
primarily with the producers/sellers/suppliers of the goods in the market,
study the market price and work out the purchase and sale prices of the goods
as per guidelines.
Sanction
·
On
completion of Appraisal as provided herein above, of the Proposal is found
viable, issue Sanction Advice (F-191) duly recorded in the investment /Facility
Sanction Register (B-119) with separate opening for investment /Facility.
·
If
the proposal is not within the Discretionary Power of the Branch, the Branch
shall with Appraisal Report on F-167A to
Zonal Office/Head Office.
·
If
the proposal is within the Business Power of the Zonal Office, Zonal Office
shall accord Approval /Regret the Proposal.
·
If
the proposal is not within the Business of the Zonal Office shall forward the
proposal to Head Office with their views and recommendations.
·
On
receiving the proposal and the Appraisal Report along with supporting papers
Head Office will either approve or Regret.
·
If
the Branch/the Zonal Office /Head Office, the branch will issue the Sanction
advice (F-197) with a copy to Zo/HO duly recorded in /Facility Sanctioned Register
(B-119) with authority to the investment Client for the limit.
·
If
the client duly accepts the sanction terms and conditions, enter the
particulars of the sanctioned proposal in the limit Register (B-117) allotting
a Fixed Serial number for each Client as per Limit Register which shall remain
permanent irrespective of the mode(s) so long the Client continues business
with the Bank.
·
Open
file Client-wise, affixing the Fixed Number allotted to him as per Limit
Register (B-117) and Client’s name,
address, telephone number be recorded prominently in the inner side of the
investment File for easy tracing in case of need.
·
Branch/the
Zonal Office /Head Office shall maintain Investment /Facility Sanctioned
Register (B-119), authorit-wise, Branch/wise seperately for Investment
/Facility (General) and scheme-wise. They shall also maintain investment
/Facility Proposal Received & Disposal Register (B-53) & Limit Register
(B-117).
·
Branch/Zonal
Office /Head Office shall maintain Investment /Facility Santioned Register
(B-119) Authorit-wise (BO/ZO/HO), Scheme-wise and for General Investment
/facility on the basis of the Sanction Advice Issued /Received.
Documentation
Before purchasing the asset/property by the Bank, obtain
sufficient collateral securities as m entioned in the sanction advice along
with the following charges documents properly executed, i.e. duly filled in,
sighed, stamped, verified and witnessed where necessary :
·
Bai-Muajjal
Sanction Advice (F-191) deal-wise duly accepted by the Client.
·
Bai-Muajjal
(Deal-Wise) (AF-2).
·
Joint
and Several D.P. Note (CF-2).
·
Single
party D.P. Note (CF-1), if there is no guarantor.
·
Double
Party D.P. Note (CF-2), if there is guarantor(s) to be made by the Client in
favor of the guarantor and endorsed by the later to the Bank.
·
D.P.
Note Delivery Letter (CF-3).
·
Letter
of Hypothecation (CF-5) for the asset(s) and Client’s stock in Trade
/Work-in-Process.
·
Letter
of Disclaimer (CF-15), if the goods are
stored in Client’s /party’ own/hired godown.
·
Agreement
for Pledge of Goods (CF-4).
·
Insurance
Policy (if stored in Client’s /Party’s Godown /Yard under Bank’s effective
control duly recorded insurance Register (B-39).
·
Letter
of Gurantee (CF-14).
·
Balance
Confirmation Letter (CF-16)
·
Trust
Receipt (CF-11).
·
Letter
of Installments (CF-17).
·
Letter
of Disbursement (CF-16).
If the Investment is made collaterally secured by
Mortgage of property, obtain the following :
·
In
case of Equitable Mortgage, Memorandum of Deposit of Title Deed (MDTD) signed
by the owner of the property.
·
In
case of Legal Mortgage, Registered Deed should be obtained.
·
Personal
Guarantee of the onner(s) of the properly on CF-14.
·
Original
title Deed(s) with CS, RS, SA, Mutation Parcha, DCR of the property and
Mutatioin record.
·
Upto-date
Rent Receipt.
·
Non-encumbrance
Certificate along with Search Fee Paid Receipt of the concerned Registry
Office.
·
Site
Plan (Map-Naksha) of the Mortgaged Property.
·
Valuation
Certificate issued by a competent Engineer and physically verified by the
Branch Officials.
·
Lawyer’s
Certificate
·
An
affidavit sworn.
Where the Investment is secured by Hypothecation of
Stock-in-trade, Machineries etc. also obtain the following Documents :
·
Letter
of Hypothecation (CF-5).
·
Trust
Receipt (CF-11).
·
Legal
Mortgage of Machineries.
In case investment is collaterally secured by pledge of
Shares of reputed Public Limited Company on bank’s approved list and quoted in
the stock Exchange, the following additional document are to be obtained :
·
Agreement
for Pledge of Shares.
·
Share
Transfer Deed in Duplicate.
·
Share
Delivery Letter
·
Letter
to the concerned Company to register Lien in Bank’s Favor.
In case of investment to Partnership Firms, obtain the
following Document :
·
Letter
of Partnership
·
Copy
of Partnership Deed
In case of investment to Private or Public Limited
Company, obtain the following Document :
·
Certified
copy of the Memorandum and Articles.
·
Resolution
of the Board of Directors.
·
Personal
Guarantee of all the Directors.
·
Certificated
of Incorporation
·
Certificated
of Commerncement
In case of investment to a Trust Organization, obtain the
following Document :
·
Copy
of Trust Deed.
·
Resolution
of the Board of Trustees
·
Charge
Document
·
Personal
Guarantee of the Office Bearer
In case of investment to Co-operative Society, obtain the
following Document :
·
Clearance
from the Registrar
·
Letter
to be issued to the concerned Registrar
·
Personal
Guarantee of the Office Bearer
·
A
copy of Bye-laws of the Society.
Signature of the Client
After completion
of Document, enter Document in Documents Execution Register (B-103).
Movement of Document, if any, should be duly recorded in
the Document Ex-custody Register duly singed by the Custodians.
Purchase of Goods by The Bank
Remember that Bai-Murabaha is perfectly a ligitimate
transaction according to the Shariah, provided :
v That the goods desired by the Client
is first purchased by the Bank and the ownership of the Bank on the goods is established, i.e.
Bank must transform its money into goods.
v That after purchase of the goods, the
risk of the goods is borne by the Bank until the possession of the Merchandise
has been passed on the Client.
v That the specification of the goods,
delivery schedule and other terms of contract are fulfilled.
·
Obtain
deal-wise application Order for Purchase on F-136 after due study.
·
Open
investment account in Investment Account Opening Register (B-102).
·
Enter
the Account Particulars in the Investment Ledger (B-105).
·
It
should be carefully noted that purchase of goods shall be made only after
completion of all the Documentation formalities, including Pre-Audit memo (F215).
·
In
case purchase of Bai-Murabaha goods by the Bank on Ceredit/deffered payment
basis, the Bank shall execute a Credit Purchase Agreement with the seller to
that effect mentioning date of delivery of Goods to the bank and that of
payment by the Bank.
·
If the
goods are to be purchased from the local or outstation market and money is to
be paid/remitted thereof and other expenses such s TA/DA, transportation etc,
shall be borne by the Bank, which shall ultimately be loaded on the cost of
Goods.
Taking Delivery of Goods by the Bank
·
After
finalization of purchse of Bai-Murabaha Goods either by the Bank officials or
through any Agent from the local or out station market the Bank shall request
the seller to delivery the goods purchased to the Bank’s Authorized official
/Agent or to the Bank godown against proper acknowledgement.
·
After
taking delivery of the goods by the Bank or trough and Agent, the Bank shall
make payment of the price of the goods to producers /sellers /supplier through
DD/TT/PO against Cash memo which will exclusively be issued in the name of the
Buying Agent.
·
The
Bank shall not be invest in such cases where the allotting Authority will not
accept the Letter of Authority and agree to deliver the goods to the Bank as
per authorization of this Allottee.
Sale and Delivery of Goods to the client
The Bank after receiving the goods shall finally
calculate the Total Cost price and fix up the sale price by mutual discussion
with Client (MANUAL, IBTRA).
Important Features
i.
Bank
is not bound to declare cost of goods and profit mark-up separately to the
client.
ii. Sport delivery of the item and
payment is deferred.
iii. Ownership and possession of the goods
is transferred by the Bank to the client before receipt of sale price.
iv. Client may offer an order to purchase
by the Bank any specified goods and committing himself to buy the same from the
Bank on Bai-Muajjal Mode.
v. It is permissible to make the promise
binding upon the client to purchase from the Bank. That is he is to either
satisfy the promise or to indemnify the damage caused by breaking the promise.
vi. Cash/Collateral Security should be
obtained to guarantee the implementation of the promise or to indemnify the
damages.
vii. Mortgagee/Guarantee/Cash Security may
be obtained before /at the time of signing the agreement.
viii.
Stock
and availability of goods is a pre-condition for Bai-Muajjal agreement. The
responsibility of the bank is to purchase the desired goods at the disposal of
the client to acquire ownership of the same before signing the bai-Muajjal
Agreement with the client.
ix. The Bank after purchase of goods must
bear the risk of goods until those are actually delivered place of delivery as per contract.
x. The bank must deliver the specified
goods to the client on specified date and at specified place of delivery as per
contract.
xi. The Bank may sell the goods at one
agreed price which will include both the cost price and the profit.
xii. The price once fixed as per agreement
and deferred can not be further increased.
Operational procedures
Mechanism of IBBL
V Induction of client
V Application
V Categorization (4)
V Processing and Appraisal
V Sanction
V Documentation
V Purchase of goods by the bank
V Taking delivery of Goods by the
bank
V Sale & delivery of goods to
the client.
3. Bai Salam
Under this mode Bank will executive
purchase contract with the client and make payment against purchase of product,
which is under process of production. Bai-Salam contract will be executed after
making any investment showing price, quality, quantity, time, place and mode of
delivery. The profit to be negotiated. It this mode the payment as the price of
the goods is made at the time of Agreement and the delivery of the goods is
deferred.
Important feature:
Bai-Salam is a mode of
investment allowed by Islamic Sharia in which commodity(ies)/product(S) can be
sod without having the said commodity (ies) /product(s) either in existence or
physical /constructive possession of the seller. If the
commodity(ies)/product(S) are ready for sale, Bai- Salam is not allowed in
Shariah. Then the sale may be done either ill Bai-Murabaha or Bai-Muajjall mode
of investment .
·
Generally,
industrial and agricultural products are purchased/sold in advance under
Bai-Salam mode of investment to infuse finance so that product is not hankered
due to shortage fund/cash.
·
It
is permissible to obtain collateral security from the seller client to secure
the investment from any hazards viz non-supply/partial supply of
commodity(ies)/product(S), supply of low quality commodity(ies) /product(S).
·
It
is also permissible to obtain Mortgage and /or Personal Guarantee from a third
party as security before the signing of the Agreement or at the time to signing
the Agreement
·
Bai-Salam
on a particular commodity(ies)/product(S) or on a product of a particular field
or firm cannot be effected (for Agricultural Product(s)only).
·
The
seller (manufacturer) client may be made agent of the Bank to sell the goods
delivered to the Bank by hirn provided a separate agency agreement is executed
between the Bank and the Client (Agent). (CLASS NOTES,Hussain, Abul).
Operational Procedures
of Investment Mechanism In Ibbl
Rules And Condition
·
There
must be a contract between the Buyer (Barlk) and Seler (Client), which shall be
the principal instrument to govern the advance selling and buying .
·
The
name, specification, brand, quantity, quality, size, etc. of the goods must
clearly be specified in the Contract leaving no ambiguity.
·
Unit
price and total price of the commodity /product must be fixed and mentioned in
the Contract.
·
The
exact time and place of delivery must be specific.
·
Mode
of transportation, transportation cost, storage charge/godown rent, insurance
etc. , if any must be specified in the contract.
·
The
name of party who will bear the cost of transportation, charge/godown rent,
insurance etc. also be mentioned in the contract.
·
Price
shall be paid to the seller in full as mentioned in the contract at the time of
signing the contract.
·
If
mentioned in the contract, delivery of the commodity /products can be
made/taken in installments or at a time within the contract period.
·
Quantity
of the commodity /products shall be in unequivocal terms.
·
If
the Seller/supplier (Client) fails to deliver the commodity /products in time
as per specification i.e. in specified quality , quantity, the seller (Client)
shall be bound to repay the price.
·
It
is not necessary to mention cost of commodity /products and profit separately
in the contract, only purchase price of the same may be mentioned.
·
After
taking delivery of the commodity /product, the Buyer (Bank) shall be the owner
& shall bear all risk until disposal /delivery of the same to the ultimate
buyer.
·
Unit
price and total price of the commodity (es)/products must be fixed and
mentioned in the Contract.
Induction of Client
·
Hold
preliminary discussion with the prospective client regarding his investment
needs, business experience, viability of the project and Shariah permissibility
of the asset, the business and the uses oft/le asset.
·
Brief
him on the salient features of Bai-Salam mode of investment.
·
Look
to the past performance of the client.
·
Check-up
Head Office Current investment policy and Branch's track record of Bai-Salam
Investment of the items
·
If
the proposal is found permissible under Islamic principles and suitable, advise
the client to submit formal Application. If not found suitable., regret
politely.
·
Request
potential client to open an AI-Wadia Current Account. Let him maintain the
Current Account Satisfactorily for n reasonnble ,oeriod (This will generally
mean six months).
Application
Obtain application in
Duplicate from the client on F-136A for disbursement of Bai-Salam deal under
composite limit sanctioned by the Bank.
Record received the investment
proposal in the" Investment Proposal Received and Disposal Register (B-55).
Obtain and affix attested
photograph(s) of the Proprietor /Partners /Directors /Trustee /Administrator on
the top right hand corner of the application.
Scrutinize the application of the
client to see that:
A. All columns
are properly filled.
B. Particulars
and information given therein are complete and correct ill all respect.
C. All
required Documents/Papers as listed in the footnote of the application are
submitted.
D. The client as per specimen signature with
the Bank signs it.
Categorization
·
The
proposal may be categorized as under:
·
Industrial
(Including small and cottage)
·
Agricultural
·
Others,
if any.
Processing and Appraisal
·
Examine
Shariah permissibility of the goods. Reject the proposal outright, if not
permitted by Islamic Shariah.
·
Check-up
Credit Restriction Schedule of Bangladesh Bank and Head Office Current
investment Policy Guidelines.
·
Study
on the strength, weakness, opportunity and treat (SWOT) of concerned business,
trade, products and deals in the Appraisal Report.
·
Separate
Appraisal Report on F-167B is not required as the Client will avail Bai-Salam
Investment under Composite limit sanctioned by the Bank.
·
Visit
the Business establishment of the Client. Talk to the business and important
personalities of the locality to ascertain the Honesty, Integrity and Business
dealings of the Client.
·
Request
for confidential report of the client from local Bank Branches. Confidential
Report from Credit Information Bureau (CIB) of Bangladesh Bank through Head
Office Investment Division as per Instruction Circular of Head Office in this
Regard.
·
Obtain
Financial Statement/Balance Sheet of the Client for the last three consecutive
years for investment Proposals of TK.50.00 Lac or above as per Head Office
Instruction.
·
Inspect
Land, Building, other Assets and Properties proposed to be Mortgaged or
Hypothecated.
·
Forward
Documents, Title Deeds and other relevant Papers to the approves Lawyer of the
Bank for examination and furnishing his opinion.
·
Please
study the following carefully and note down the actual findings in the
Appraisal Form against each item :
q
Effective
demand, price of the goods, Short or long-term duration, quality and other
specifications of the goods, availability, etc. of the said or projected goods.
·
Whether
sale price of the goods is payable by the client at specified future date in
lump sum or in installments as per proposal.
·
Particulars
figures and statistics in Appraisal form correctly with special attention to
the following :
q
Composition
of assets of the Client, extent and nature of liabilities of the Client, the
value of Liquid Assets, Business Reputation of the Client experience of the
Client, etc.
Contact primarily with the
producers/sellers/suppliers of the goods in the market, study the market price
and work out the purchase and sale prices of the goods as per guidelines.
Sanction And
Disbursement
·
On
receiving Application (F-136) under Composite Facilities /Investment approved
by the Competent Authority, Pre-Audit Memo to be prepared and got the same
approved by the Branch Incumbent for issuing Sanction Advice. Sanction Advice
to be issued as per prescribed format.
·
If
the Sanction Advice is accepted by the Client, execute Bai-Salam Agreement (F-)
immediately.
·
Collaterals
and its legality, title to the property and all required Security Documents and
the Charge Document are to be examine/obtained at time of execution of
Bai-Saiam Agreement and all mortgage formalities are also to be completed at
this stage, if not done earlier.
·
Open
file client-wise and deal-wise.
·
Affix
account number on each .file and on the related papers.
·
Transaction
to be recorded in the Computer by the authorized official properly as per
guidelines in this regard.
·
After
execution of the Bai-Salam Agreement and completion of the mortgage formalities
including Charge Document as provided herein above, disbursement may be made to
the Client as per terms of Bai-Salam Agreement.
Documentation
Obtain the following charge documents
executed properly i.e. duly filled in, signed, stamped witnessed where
necessary:
·
A
copy of Application Form F-136.
·
Single
party D.P. Note (F-118), if there is no guarantor.
·
Double
Patty DP .Note (F-119) , if there is guarantor(s) to be made by the client in
favor of the guarantor and endorsed by the later to the Bank.
·
D.P.
Note Delivery Letter (F-171).
·
Sanction
Advice.
·
Bai-Salam
Agreement.
·
Letter
of Disbursement
·
Insurance
Policy.
·
Letter
of Disclaimer
If the Investment is made
collaterally secured by Mortgage of property, obtain the following document:
·
In case of Equitable Mortgage, Memorandum of Deposit of
Title Deed (MDTD) signed by the owner of the property .
·
In
case of Legal Mortgage, Registered Deed should be obtained. .Personal Guarantee
of the owner(s) of the property on CF-14.
·
Original
Title Deed(s) with CS, RS, SA, Mutation Parcha, DCR of the property and
Mutation record.
·
Upto-date
Rent Receipt.
·
.Memorandum
of deposit of Title Deed.
·
Non-encumbrance
Certificate along with Search Fee Paid Receipt of the concerned Registry
/Sub-Registry Office .
·
Site
plan (Map/Naksha) of the Mortgaged Property.
·
Valuation
Certificate issued by a competent Engineer and physically verified by the
Branch Officials.
·
Lawyer's
Certificate
·
An
Affidavit sworn
Where the Investment is secured by
Hypothecation of Stock-trade, Machineries etc. also obtain the following
Documents:
·
Letter
of Hypothecation(CF-5).
·
Trust
Receipt(CF-11 ).
In case investment is
collaterally/additionally secured by pledge of Shares of reputed Public Limited
Company on bank's approved list and quoted in the stock Exchange, the following
additional document are to be obtained:
·
Agreement
for Pledge of Shares
·
Blank
Share Transfer Deed in Duplicate
·
Share
Delivery Letter
·
Letter
to the Concemed Company to register Lien in Bank's Favor .
In case of investment to
Partnership Firms, obtain the following Document:
·
Letter
of Partnership
·
Copy
of Partnership Deed
In case of investment to
Private or Public Limited Company, obtain the following Document:
·
Certified Copy of the
Memorandum and Articles.
·
Resolution
of the Board of Directors
·
Personal
Guarantee of all the Directors
·
Certificated
of Incorporation
·
Certificated
of Commencement
In case of investment to a
Trust Organization, obtain the following Document:
·
Copy
of Trust Deed
·
Resolution
of the Board of Trustees
·
Charge
Document
·
Personal
Guarantee of the Office Bearer
In case of investment to Co-operative
Society, obtain the following Document
·
Clearance
from the Registrar
·
Letter
to be issued to the concerned Registrar
·
Personal
Guarantee of the Office Bearer
·
A
copy of Bye-laws of the Society
Rates
of Stamp Duty
Signature
of the Client
After Completion of Document, enter
tl1e Document in Documebnts Execution Register.
Movement of Document, if any, should
be duly recorded in the Document Ex-custody Register duly signed by the
Custodians.
Clarification Regarding Ownership of Imported Raw
Materials to Avoid Confusion of Buy Back
It may be mentioned here
clearly that like all other import under cash/Barter/AID, the raw materials for
manufacturing/processing/finishing of export products are also imported under
Back to Back L/C for ultimate export under deferred payment through an
undertaking of the Bank i.e. L/C. the import risks remain covered by insurance
policies. The undertaking i.e. L/C of the Bank is obligatory on the issuing
Bank for making payment of the documents are drawn strictly in accordance with
the terms off the L/C. As such, the ownership of fabrics in fact lies with the
Sank. Moreover, the Sill of lading and the Sill of Exchange are made to the
order of the Bank. L/C Application and Agreement contains the clause regarding
ownership of goods by the Bank. Still the Islami Bank opens the L/C/Back-to
-Back L/C against the Letter of Authority (F-219)obtained from the importer to
utilize his /their License /Authority for the import and undertake to purchase
the goods so imported/purchased by the Bank for ultimate manufacturing /export
of the products by the buyer (exporter).
Immediately after opening
L/C, the consignment shall be sold by the Sank to the client under Bai-Murabaha
/Bai-Muallal(import) Agreement and Trust Receipt (T/R) Mortgage Documents, if
any, etc. Accounting effects on such Sai-Murabaha/Bai-Muajjal Investment shall
be given as and when Bank's fund is actually involved. Rebate shall, however be
allowed for early adjustment/adjustment of profit, if any, charged in excess as
per calculated rate of profit.
Procedure of Bai-Salam Investment in
Export Oriented Industries
Bai-Salam investment may be
allowed after opening of the L./c, arrival of raw materials, shipment of raw
materials etc.
The Bank may sell/export its
goods through the seller/exporter (Client) under a separate agreement or this
may be done duly incorporating in the Bai-Salam Agreement unless otherwise
settled and prescribed.
The price of the Bai-Salam
deal shall be fixed up keeping in view the Export/Sale Price mentioned in the
relative Export L.C./Contract, the Bank shall fix up it's profit as per rate
prescribed by Head Office from time to time.
Fixation of Purchase Price
Points to be considered at the time
of bargaining with the client for fixation of price of the goods to be purchase
under Bai-Salam.
The time for taking delivery
of the goods.
Anticipated time from the
date of date of of Bai-Salam price to final disposal of the goods.
Taking delivery and costs
for marketing, transportation charges, and selling commission etc. Godown
Guard's salary, insurance, godown rent etc.
Present market price and the
anticipated sale price at the time of disposal of the goods. Expected rate of
returns as per Head Office norms.
All areas of appraisal should be
carefully studied and the Appraisal forms (167B ) should be completed properly.
Purchase price shall be
fixed-up with due study keeping in view that after sale of the goods the Bank
gets profit as per expected Rate of Return.
Taking Delivery
The client shall exclusively utilize
the investment for the purpose for which he has taken it and shall
deliver/export the goods as per Bai-Salam Agreement.
The Bank shall take delivery of the
goods from the client either by itself or through its representative as per
Bai-Salam Agreement and Delivery Schedule.
The bank shall not disburse
the investment unless the client completes all necessary arrangements for the
proposed production /manufacture.
In case the Client tails to produce
and deliver/export the goods, he will immediately refund the money received
from the Bank.
If necessary I Bank may
authorize the Client in writing to sell/deliver/supply/export the Bai-Salam
goods against his /their license /contract/sale agreement for and on behalf of
the Bank as its agent at a price not lower than the price fixed by the Bank
provided a separate agency agreement is executed between the bank and the
Client (Agent).
Taking delivery of the goods
after the due date of delivery as per schedule shall be at the absolute
discretion of the Bank.
Sale of Bai-Salam Goods
After taking delivery of the
goods by the Bank, the Bank shall sell out the goods expeditiously at the highest
available price ensuring the expected profit at the lower side. In case of any diverse situation, the
Branch shall immediately write to Head Office through Zonal Office for decision
..
The Bank shall arrange
proper storing of the goods until disposal.
Bank may entrust the client
to sell the goods as its agent at a price not lower than the price fixed by the
Bank provided a separate agency agreement is executed between the Bank and the
Client (Agent).
The Bank may authorize any official
person/firm /companies to sell the goods at a price not lower than the price
fixed by the Bank.
Compensation/Fine Penalty
In case of the Client's failure to
deliver/sell /supply/export the goods as per Agreement, he will have to pay
compensation/penalty/fine at a fixed rate per day from the fixed date of
delivery of goods as mentioned in the contract.
Purchase Of Goods By
The Bank
·
Remember
that Bai-Murabaha is perfectly a legitimate transaction according to the
Shariah, provided:
à That
the goods desired by the Client is first purchased by the Bank and the
ownership of he Bank on the goods is established, i.e. Bank must transform its
money into goods.
à That
after purchase of the goods, tile risk of the goods is born by the bank until the possession of the
Merchandise has been passed on the Client.
à That
the specification of the goods, delivery schedule and other terms of contract
are fulfilled.
¨ Obtain deal-wise application Order
for Purchase on F-136 after due study.
¨ Open investment
account in Investment Account Opening Register (B-1 02)
¨ Enter the Account
Particulars in the Investment Ledger(B-105)
¨ It should be carefully noted that
purchase of goods shall be made only after completion of all the Documentation
formalities, including Pre-Audit memo (F215).
¨ In case purchase of Bai-Murabaha
goods by the Bank on Credit/deferred payment basis, the Bank shall execute a
Credit Purchase Agreement with the seller to that effect mentioning date of
delivery of Goods to the Bank and that of payment by the Bank.
¨ If the goods are to be purchased from
the local or outstation market and money is to be paid/remitted through
PO/TT/DO etc., the PO/TT/OD must be on behalf of the Bank and the commission
thereof and other expenses such as TA/,DA, transportation etc, shall be borne
by the Bank, which shall ultimately be loaded on the cost of Goods.
Taking Delivery Of Goods By The Bank
·
After
finalization of purchase of Bai-Murabaha Goods either by the Bank officials or
through any Agent from the local or out station market the Bank shall request
the seller to deliver the goods purchased to the Bank's Authorized
official/Agent or to the Bank godown against proper acknowledgement.
·
After
taking delivery of the goods by the Bank or through and Agent, the Bank shall
make payment of the price of the goods to producers /sellers /supplier through
DD /TT /PO against Cash memo which will exclusively be issued in the name of
the Bank.
·
DD/TT
may also be issued in the name of the Buying Agent.
·
The
Bank shall not be invest in such cases where the allotting Authority will not
accept the Letter of Authority and agree to deliver the goods to the Bank as
per authorization of this Allottee.
Sale And Delivery Of Goods To The
Client
The Bank after receiving the goods
shall finally calculate the Total Cost price and fix up the sale price by
mutual discussion with Client (MANUAL, IBTRA).
4. ISTESHNA'A
Isteshna'a is a contract
between a manufacturer/seller and a buyer under which the manufacturer/seller
sells specific product(s) after having manufactured, permissible under Islamic
Shariah and Law of the Country after haying manufactured at an agreed price
payable in advance or by installments within a fixed period or on/within a
fixed future date on the basis of the order placed by the buyer.
Important feature :
·
Istisna’a
is an exceptional mode of investment allowed by Islamic Shariah in which
product(s) can be sold without having the same in existence. In the product(s)
are ready for sale. Istisna'a is not allowed is Shariaf. Then the sale may be
done either in Bai-Murabaha or Bai-Maajjal mode of investment. in this mode,
deliveries of goods are deferred and payment of price may also be deferred.
·
It
facilitates the manufacturer sometimes to get the price of the goods in
advance, which he may use as capital for producing the goods.
·
It
gives the buyer opportunity to pay the price in some future dales or by
installments.
·
It
is a binding contract and no party or is allowed to cancel the Istisna'a
contract after the piece is paid and received in full or in part or the
manufacturer starts the work.
·
Istina'a
is specially practiced in manufacturing and industrial sectors, However, it can
be practiced in agricultural and constructions sectors also (Class Note, Abul Hussain).
Ijara
Mechanism (Leasing Mode)
(1) Hire Purchase /Ijarah
The term Ijarah has been derived from
the Arabic works Ajr and Ujrat which means consideration, return, wages or
rent. This is really the exchange value or consideration, return, wages, rent
of service of an Asset. Ijarah has been defined as a contract between two
parties, the Hiree and Hirer where the Hirer enjoys or reaps a specific service
on benefit gainst a specified consideration or rent from the asset owned by the
Hiree. It is a hire agreement under which a certain asset is hired out by the
Hiree to a Hirer against fixed rent or rentals for a specified period.
(2) Hire Purchase
Under shirkatul Melk
Hire purchase under shirkatul Melk is
a special type of contract which has been developed through practice. Actually,
It is a synthesis of three contracts : Shirkat, Izara and sale. Shirkat means
partnership. sharikatul Melk means share an ownership. when two or more persons
supply equity, purchase an asset, own the same jointly, and share the benefit
as per agreement and bear the loss in proportion to their respective equity,
the contract is called Shirkatul contract.
Stages of Hire Purchase Under
Shirkatul Melk
Thus Hire Purchase under Shirkatul
Melk Agreement has got three stages :
·
Purchase
under joint ownership.
·
Hire
and
·
Sale
and /or transfer of ownership to the other partner Hirer.
Types of sale contract in hire
purchase under shirkatul melk
As per procedure of transfer of
ownership and legal title of the part
owned by the Bank is transferred to the other partner, the sale contract
may be of various, some of the major forms are mentioned below :
Hire
Purchase Under Shirkatul Melk through gradually transfer (sale) of legal
title/ownership of the hired asset/property
Under this type certain
.asset / property' is purchased with equal or unequal equity participation and
owned jointly by the to parties -the Bank and the Client. The Bank's share /
portion of the asset is hired out to tIle Client partner against fixed
rent/rentals per unit of time for a fixed period with a promise that the Hire
Bank will sell or transfer the ownership of its portion to the Client Hirer
gradually part by part in proportion to the consideration paid. So that the
Hire's portion of the asset on payment of the total price at the end of the
hire period.
Under this system the total price of
the hired property / asset should be determined and divided over the period of
hire contract (per unit of time) so that the Hirer in addition to the payment
of fixed rent /rentals may pay gradually the proportionate consideration of the
total price of the hired property or asset to acquire proportionate ownership
of the same part by, part and become full owner of the hired asset at the end
of the hire period.
It should be noted that
there should be a separate sale contract for payment / acquisition of each
share (per unit of time as per hire deal) / part of asset sold to the Hirer and
the amount of rent should be decreased proportionately with decrease of Hire's
ownership and increase of Hirer's ownership on the property/asset.
If, for any reason, the hire
contract is revoked prior to the payment I transfer of full title to the Hirer,
the Hirer will share that part of the title to the hired property which has
been transferred to him against payment made by him and the remaining part will
be shared by the Hire Bank. If any loss arises to the Bank after the sale of
Bank's share to the property / asset that shall be recouped from the Client /
Client's security. In our Bank, we shall be following this type of Sale Contract
in Hire Purchase under Shirkalul Melk.
Hire
Purchase Under Shirkatul Melk Through Transfer of legal title by gifts (for no
consideration).
Under this type the portion
of asset owned by the Hire partner is hired out to the Hirer partner with a
prior promise that the Hire, upon settlement of all the rent / rentals /
installments by the Hirer, will transfer his ownership I title to the property
to the Hirer through gift without any further consideration.
After the expiry of the hire
period and payment of all the rent /rentals installment, the title of property
may be transferred by a separate gift deed executed by the Hire or, the title
may be transferred by issuing a gift deed by the Hire making it conditional on
the settlement of all rental installments. In the later case, the legal title
is automatically transferred as soon as the hire period expires and the fixed
rent installments for rent are settled. The working of the agreement would be:
If the agreed upon rental installments are settled within the agreed upon
period, ownership of the asset will be transferred to the Hirer as gift.
Under this mode the rentals
fixed and agreed upon will be sufficient not only to amortize the capital
outlay but also to yield an adequate amount of profit for the Hire. However,
tile rent / rentals agreed upon shall not be considrered as price or part of
price of the asset and the full ownership of the asset shall lie with the Hire
till final settlement of the rent I rental installments.
Hire Purchase Under Shirkatul Melk Through
transfer of legal title (sale) at the end of hire period for a token
consideration
Under this contract the
possession of the asset owned by the Hire is hired out to the hire for a fixed
period against fixed rent / rentals and at the end of the hire period the title
to the asset is transferred to the Hirer by a separate sale contract on payment
of agreed upon token consideration. The consideration may be equal to the value
of the asset or not and it would be sufficient if a mutual agreement is reached
on the consideration.
Hire Purchase Under Shirkatul Melk through transfer of
legal title (sale) at the end of Hire period for payment of a specified amount
to the hire by the hirer
·
This
agreement includes an Ijarah / hire contract and a sale contract. Under this
agreement a specific asset is hired out for a fixed period against specific
rent mentioning a specific consideration to be paid by the Hirer (buyer) after
the expiry of the hire period and upon payment of the agreed upon
consideration. The hired asset becomes sold and its title transferred to the
Hirer (the buyer). Under the agreement, the hire contract becomes effective
firstly sale contract will be effective only after the expiry of the hire
contract.
·
Hire
Purchase Under Shirkatul through transfer of legal title (sale) period to the
end of the hire term for a price that is equivalent to the remaining Ijarah
/rental instruction. This is an Ijarah J hire agreement which includes a
promise made by the Hire that he will transfer the title of the hired property
to the Hirer at any time during the hire period on payment of the remaining
Ijarah /rental installments, if the Hirer wishes so. Under this system first,
the Ijarah/hire contract becomes effective and remains so until the legal title
is transferred to the Hirer. As soon as the title to the asset is transferred
to the Hirer the ijarah/hire contract lapses for the remaining period, because
both tile benefit and the hired property become the Hirer's property. This type
of sale should be executed by a separate sale contract at the time of sale.
Important Feature :
·
In
case of Hire Purchase under Shirkatul Melk transaction the asset / property
involved is jointly purchased by the Hire (Bank) and the Hirer (Client) with
specified equity participation under a Shirkatul Melk Contract in which the
amount of equity and share in ownership of the asset of each partner (Hire Bank
& Hirer Client) are clearly mentioned. Under this agreement, the Hire and
the Hirer become co-owner of the asset under transaction in proportion to their
respective equity participation.
·
In
Hire Purchase under Shirkatul Melk Agreement, the exact ownership of both the
Hire (Bank) and Hirer (Client) must be recognised- However, if the partners
agree and wish that the asset purchased may be registered in the name of anyone
of them or in the name of any third party, clearly mentioning the same in the
Hire Purchase Shirkatul Melk Agreement. However, in IBBL, no third party
registration shall be allowed.
·
The
share / part of purchased asset owned by the Hire (Bank) is put at disposal /possession of the Hirer (Client)
keeping the ownership with him (Bank) for a fixed period under a hire agreement
in which the amount of rent per unit of
tirne and the benefit for which rent to be paid along with all other agreed
upon stipulations are also to be clearly stated. Under this agreement, the
Hirer (Client) becomes the owner of the benefit of the asset but not of the
asset itself, in accordance with the specific provisions of the contract which
entitles the Hire (Bank) is entitled for the rentals.
·
As
the ownership of hired portion of the asset lies with the Hire (Bank) and rent
is paid by the Hirer (Client) against the specific benefit, the rent is not
considered as price or part of price of the asset.
·
In
the Hire Purchase under Shirkatul Melk Agreement the Hire (Bank) does not sell
or the Hirer (Client) does not purchase the asset but the Hire (Bank) promise
to sell asset to the Hirer (Client) part by part only, if the Hirer (Client)
pays the cost price / equity / agreed price as fixed for the asset as per
stipulations within agreed upon period on which the Hirer also gives
undertakings.
·
The
promise to transfer legal by the Hire undertakings given by the Hirer to
purchase ownership of the hired asset upon payment part by part as per
stipulations are effected only when it is actually done by a separate sale
contract.
·
As
soon as any part of Hire's (Bank's) ownership of the asset is transferred to
the Hirer (Client) that becomes the property of the Hirer and hire contract for
that share / part and entitlement for rent thereof lapses.
·
In
Hire Purchase under Shirkatul Melk Agreement, the Shirkatul Melk contract is
effected from the day the equity of both parties deposited and the asset is
purchased and continue upto the day on which the full title of Hire (Bank) is
transferred to the Hirer (Client).
·
The
hire contract becomes effective from the day on which the Hire transfer the
possession of the hired asset in good order and usable condition to the Hirer,
so that the Hirer may make the agreement.
·
Effectiveness
of the sale contract depends on the actual sale and transfer of ownership of
the asset by the Hire to the Hirer. It is sold and transferred part by part, it
will become effective part by part and with the sale and transfer of ownership
of every share / part. The hire contract for that share / part will lapse and
the rent will be reduced proportionately. At the end of the hire period when
the full title of the asset will be sold out and transferred to the Hirer
(Client), the Hirer will become the owner of both the benefit and the asset
consequently the hire contract will fully end.
·
Hire
Purchase under Shirkatul Melk is a binding contract for the parties to it- the
Bank and the Client who are committed to fulfill meet their undertakings I
obligations in accordance with the relevant agreement.
·
Under
this agreement the Bank acts as a partner, as a Hire and at last as a seller
;on the other hand the Client acts as a partner, as a Hirer and lastly as a
purchaser.
·
Ownership
risk is borne by both the Hire and Hirer in proportion to their retained
ownership equity.
·
Under
this agreement the role of Hirer is one that of a trustee, the hired asset
being a trust property in his hands: he will manage, maintain the asset in
favour of the interest of the Hire at his own cost as the exact subject of
hirer except in cases of any accident due to any event entirely beyond control
of the hirer and natural calamity/disaster (acts of Allah) to be determined by
the Bank after proper investigation within the knowledge of the hirer.
·
The
Hirer is responsible for keeping the hired asset(s) in good condition
throughout the whole period of hire and if the asset is damaged 01- destroyed
due to mismanagement, corruption, negligence, transgressions, default, etc. of
the Hirer, he shall be responsible to compensate the Hire (Bank) for that. Of
course, such mismanagement, corruption, negligence, transgressions, default,
etc. of the hirer shall be management, corruption, negligence, transgressions,
default, etc. of the hirer shall be determined by the Hire (Bank) after proper
investigation within the knowledge of the hirer.
·
The Hirer cannot, without obtaining prior written
permission of the Hire (Bank) make any changes in the exact item of the hire,
and / or remove it from its place of installation and transfer it to another
location.
·
In a
Hire Purchase under Shirkatul Melk agreement any stipulation may be made,
provided it is not against the nature and requirements of the contract itself,
nor does it violate the /this may be the last one devine laws of Islam and is
also acceptable to both the parties.
·
Hire
Purchase under S'nirkalul Melk facilities may be for medium-term or long-term
period which may be utilised for the expansion of production and services, as
well as housing activities. The duration of Hire Purchase under Shirkatul Melk
contract shall not exceed the useful
life of the subject / asset of the transaction. The Bank should not
normally enter a Hire Purchase under Shirkatul Melk transaction for items with
useful life of less than two years.
·
Hire
Purchase under Shirkatul Melk transaction facilitates the Client (Hirer) to get
benefit from the hired asset in exchange of rental and also to become full
owner of the asset by purchasing it part by part.
·
If,
for any reason, the hire contract is revoked prior to the transfer of full
title of the asset to the Hirer, then the title of the asset will be shared by
both Hire and Hirer the Hirer will share that part of title which has been
transferred to him against payment and the Hire will share the remaining part.
·
The
Hirer to secure the Bank (the Hire) will pledge / hypothecate / mortgage his
portion / part / share in the asset (acquired / to be acquired) and or any
other asset / property of his own / third party guarantor to the Bank to fulfil
his all liabilities /commitments including the accrued rental, if any.
Rules For Hire Purchase Under
Shirkatul Melk
1. It is a condition that the subject
(benefit/service )of the contract and the asset should be known comprehensive.
2. It is a condition that the asset to be hired
must be a fungible one which can not be used more than once or in other words,
the asset must be a non-fungible than which can be utilized more than once or the
use/benefit of which can be separated from the asset itself.
3. It is a condition that the subject
(benefit/service )of the contract must actually and legally be
attainable/derivable.
4. It is a condition that the Hirer shall
ensure that he will make use of the asset as per provisions of the agreement or
as per customs/norms/practice, if there is no expressed provision .
5. The hire contract is permissible only when
the asset and the benefit /services It is within the category of 'Halal' or at
least 'MOBAH' as per Islamic Shariah.
6. The Hire is under obligation to enable the
hirer to the benefit from tt1e asset by putting the possession of the asset at
his disposal in useable condition at the commencement of the hire period.
7. In a hire contract, the period of hire and
the rental to be paid per unit of lime be clearly stated.
8. Everything that suitable to be considered a
price, in a sale, can be suitable to be considered rental in a hire contract.
9. It is a condition that the rental falls due
from the date of handing-over of the asset to hirer and not from the date of
contract or use of the asset.
10. It is permissible to advance, defer or install
the rental in accordance with the agreement.
11.
It is permissible to review the hire period or the rental or the both, if the
hire and the hirer mutually agree to do so.
12.
The hired asset is a trust in the hands of the hirer.
13. The
hiree/owner bears all the costs of legally binding basic repairs and
maintenance. 14. It is permissible to make the hirer to bear the cost of
ordinary routine maintenance.
15. The
hire contract is binding and on one party shall unilaterally rescind except
reasons that abrogate binding contract such as damage or destruction.
16. It is also permissible to sell the hired asset
by the hiree to the hirer during the tenure of the hire period either part by
part or in full at a time.
17. Under Hire Purchase under Shirkahll Melk
Agreement, both the Hiree and the Hirer must any their respective equity as
agreed upon to purchase the demised asset under joint ownership.
18.
Ownership of the asset of both the hiree and hirer should be recognized ass per
law of the land.
19. In a
Hire Purchase under Shirkatul Melk contract, it is permissible to divide the
sale/cost price of the asset or ownership of the hiree to the asset into
several parts and to sell each part of ownership on payment of proportionate
sale/cost price of the hiree.
Operational
procedures of investment" mechanism in
ibbl
Induction of client
·
Hold
preliminary discussion with the prospective client regarding his investment
needs, business experience, viability of the project and Shariah permissibility
of the asset, the business and the uses of the asset.
·
Brief him on the salient features of Hire Purchase under
Shirkatul Melk mode of investment.
·
Look
to the past performance of the client,.
·
Check-up
Head Oft Ice Current investment policy and Branch's track record of Hire
Purchase under Shirkatul Melk investment of the items
·
If
the proposal is found permissible under Islamic principles and suitable, advise
the client to submit formal Application. If not found suitable, regret
politely.
·
Request
potential client to open an Al-Wadia Current Account. Let him maintain the
Current Account Satisfactorily for a reasonable period. This will generally
mean six months.
Application
Obtain application in
triplicate from the client on F-167A and record the same in the investment
proposal Received and Disposal Register (8-55).
Obtain and affix attested photograph
of the Proprietor /Partners /Directors /Trustee /Administrator on the top right
hand corner of the application .
Scrutinize the application
of the client to see that:
A. All columns are properly filled in,
B. Particulars
and information given therein are complete and correct in all respect.
C. All required
Documents/Papers as listed in the footnote of the application are submitted .
D. It is signed
by the client as per specimen signature with the Bank.
Categorisation
Categorize
the proposal as under :
Hire
Purchase under Shirkatul Melk Commercial
Investment on Hire Purchase
under Shirkatul Melk mode to individual /Firm /Company /Society for Commercial
purposes shall be termed as Hire Purchase under Shirkatul Melk Commercial.
Hire Purchase under Shirkatul rJlelk Industrial
Hire Purchase under
Shirkatul Melk investment to industrial undertakings in the Form of Land,
Buildings, Machineries, Equipments, Transport, etc. shall be termed as Hire
Purchase under Shirkatul Melk Industrial.
Hire Purchase under Shirkatul Melk Agriculture
Hire purchase under
Shirkatul Melk Investment to agriculture sector in the form of Agricultural
Equipment, Machineries Shallow Tube-Well, Deep Tube-Well, Tractor, Trailers,
Transport etc. shall be termed as Hire Purchase under Shirkatul Melk
Agriculture.
Hire Purchase under Shirkatul Melk Transport
Hire Purchase under
Shirkatul Melk investment in the form of Transport -Bus, Truckm Car, Taxi,
Launch, Steamer, Cargo Vessel, Air Transport etc, shall be termed as Hire
Purchase under Shtrkatu! Melk Transport.
Hire
Purchase under Shirkatul Melk Real Estate
Hire Purchase under
Shirkatul Melk investment in the form of Land, Building, Market, Apartments,
for use/rental shall be termed as Hire Purchase under Shirkatul Melk Real Estate.
Hire Purchase under Shirkatul Melk Real Estate
Hire Purchase under
Shirkatul Melk investment in the form of asset for use/rental under any scheme
all be termed as Hire Purchase under Shirkatul Melk cheme.
Enter the Application in the "Investment
Proposal Received and Disposal Register (8-53) and allot a Serial Number to it.
Initiate
action for Processing and Appraisal immediately.
Processing And Appraisal
·
Examine
Shariah permissibility of the goods. Reject the proposal outright, if not
permitted by Islamic Shariah.
·
Check-up
Credit Restriction Schedule of Bangladesh Bank and Head Office Current
Investment Policy Guidelines.
·
Visit
the Business establishment of the Client. Talk to the business and important
personalities of the locality to ascertain the Honesty , Integrity and Business
dealings of the Client.
·
Request
for confidential report of the client from local Bank Branches. Confidential
Report from Credit Information Bureau (CIB) of Bangladesh Bank through Head
Office Investment Division as per Instruction Circular of Head Office in this Regard.
·
Obtain
Financial Statemen/Balance Sheet of the Client for the last three consecutive
years for Investment Proposals of Tk. 50.00 Lac or above as per Head Office
Instruction.
·
Inspect Land, Building, other Assets and Properties
proposed to be Mortgaged or Hypothecated.
·
Forward
Documents, Title Deeds and other relevant Papers to the approves Lawyer of the
Bank for examination and furnishing his opinion.
·
Obtain
Lawyer's Opinion as per clause No. 7.18.2(i).
·
Please
study the following carefully and note down the actual findings in the
Appraisal Form against each item:
à Effective demand, price of the goods, Short or
long-term duration, quality and other specifications of the goods, availability
, etc. of the said or projected goods .
·
Whether
sale price of the goods is payable by the client at specified future date in
lump sum or in installments as per proposal.
·
For
Hire Purchase under Shirkatul Melk Investment (other than the Scheme), prepare
Appraisal Report on F-167B. For appraisal Hire Purchase under Shirkatul Melk
Industrial /Agriculture............Scheme use specific Appraisal form devised
for each of those, if any, otherwise F-167/B. In course of preparation of the
appraisal report please ensure incorporation of all information, particulars
figures and statistics in Appraisal Form correctly with special attention to
the following :
à Composition
of assets of the Client, extent and nature of liabilities of the Client, the
value of Liquid Assets, Business Reputation of the Client experience of the
Client, etc.
·
Contact
primarily with the producers/sellers/suppliers of the goods in the market,
study the market price and work out the purchase and sale prices of the goods
as per guidelines.
·
Whether
Client & Bank's equity ratio is fixed to cover the price/cost of the asset.
·
Whether
rental and sale price of the assets are payable by the Client at the agreed
specified future date lump sum or by installments as per proposal.
·
Experience
of the Client in the business, management capability etc.
·
Guideline
for working out the cost price of the asset.
·
Cost
Price of the Assets -1. Purchase price of tile asset expenditures concerning
the purchase i.e. Transportation, storage, costs of construction, cost of installation,
making etc. before hire of the asset to the Hirer partner. 2. Conveyance- TA/DA
of Bank's Official or the Agent, if any, 3. Commission paid to the Agent, if
any, 4. Cost of remittance of fund, 5. Transportation cost upto Bank's
Godown/Client Project Site. 6. Other expenses except interesi incurred, if any,
interest element, if any is to be paid by the Hirer partner, 7. Godown rent and
godown staff Salary, if any, incurred before delivery/handing over the asset to
the Hirer in good and usable condition, 8. Income loss sustained during the
gestation period. 9. it far any reason the client after handing over the asset to him in good and usable
condition uses Bank's godown, the godown, the godown rent and god own staff
salary will be borne by him (Hirer partner).
·
Fixation
of Rental and the sale price of Asset.
Sanction
·
On
completion of Appraisal as provided herein above, of the Proposal is found
viable, get it approved by the Investment Officer, 2nd Officer and the Manager
and sanctioned by the Manager if it is within his business power.
·
If
the proposal is not within the Discretionary Power of the Branch, forward the
proposal (F-167A) with Appraisal Report on F-167/BF-136 to Zonal Office/Head
Office.
·
If
the proposal is within the Business Power of the Zonal Office, Zonal Office
shall accord Approval/Regret the Proposal duly recorded in the Investment
proposal Received & Disposal Register (B-33) & Investment /Facility
Sanctioned Register (B-119).
·
If
the proposal is within the Business Power of the Zonal Office, Zonal Office
shall accord Approval/Regret the Proposal duly recorded in the Investment
proposal Received & Disposal Register(B-53) & Investment /Facility
Sanctioned Register (B-119).
·
If
the proposal is not within the Business Power of the Zonal Office shall forward
the proposal to Head Office with their views and recommendations.
·
On
receiving the proposal and the Appraisal Report along with supporting papers
Head Office will either approved or regret duly recorded in the Investment
proposal Received & Disposal Register (B-53) & Investment /Facility
Sanctioned Register(B-119).
·
If
the Branch/ the Zonal Office/ Head Office, the branch will issue the Sanction
advice(F- 197) with a copy to ZO/HO duly recorded in /Facility Sanctioned
Register(B-119) with authority wise separate opening (Branch/ZO/HO) mentioning
all the terms and conditions in duplicate to the investment Client for the
limit.
·
It
the Client duly accepts the sanction terms and conditions, enter the
particulars of the sanctioned proposal in the limit Register (6-117) allotting
a Fixed Serial number for each Client as per Limit Register which shall remain
permanent irrespective of the mode(s) so long the Client continues business wit
the Bank.
·
Open
file Client-wise, affixing the Fixed Number allotted to him as per Limit
Register (B- 117) and Client's name, address, telephone number be recorded
prominently in the inner side of the investment File for easy tracing in case
of need.
·
Branch/
the Zonal Office/ Head Office shall maintain Investment/Facility Sanctioned
Register(B-119), authority-wise, Branch-wise separately for Investment
/Facility (General ) and Scheme-wise. They shall also maintain
Investment/facility Proposal Received & Disposal Register (B-53) &
Limit Register (B-117).
Documentation
Before purchasing the asset/property
by the Bank, obtain sufficient collateral securities as mentioned in the
sanction advice along with the following charge documents properly executed,
i.e. duly filled in, sighed, stamped, verified and witnessed where
necessary"
·
Hire
Purchase under Shirkatul Melk Sanction Advice(F-192) deal-wise duly accepted by
the Client.
·
Hire
Purchase under Shirkatui Melk Agreement (Deal-Wise) (AF-4).
·
Letter
of Pledge (CF-4) (Deal-Wise)/Mortgage Deed.
·
Single
party D.P. Note (CF-1), if there is no guarantor.
·
Double
Party D.P. Note(CF-2), if there is guarantor(s) to be made by the Client in
favor of the guarantor endorsed by the later to the Bank.
·
Letter
of Disclaimer (CF)-15 , if stored in Client's /party' own/hired godown.
·
Insurance
Policy (if stored in Client's /Party's Godown/Yard under Bank's effective
control) duly recorded in Insurance Register (B-39).
·
Letter
of Guarantee (CF-14).
·
Balance
Confirmation Letter (CF-16 .
·
Letter
of Disbursement(CF-16).
·
Letter
of Installment (CF-17).
If the Investment is made
collaterally secured by Mortgage ot property, obtain the following document:
·
In
case of Equitable Mortgage, Memorandum of Deposit of Title Deed (MDTD) signed
by the owner of the property.
·
In
case of Legal Mortgage, Registered Deed should be obtained.
·
Personal
Guarantee of the owner(s) of the property on CG-14.
·
Original
Title Deed(s) with CS,RS,SA, Mutation Parcha, DCR of the property and Mutation
record.
·
Upto-date
Rent Receipt.
·
Non
encumbrance Certificate along with Search Fee Paid Receipt of the concerned
Registry /Sub-registry Officer.
·
Site
plan (Map/Naksha) of the Mortgaged Property.
·
Valuation
Certificate issued by a competent Engineer and physically verified by the
Branch Officials.
Purchase of Asset/Property
by the Bank
Remember that Hire Purchase under
Shirkatul Melk is perfectly a legitimate transaction according to the Shariah,
provided:
·
That
the asset/property desired by tile Client (Hirer)- is first purchased by the
Bank and the Client (Hirer) jointly. The ownership to the asset/property shall
be as per equity participation of the Bank and the Client. Rent will accrue
only after delivery of the asset/property to the Hirer in usable condition/good
order.
·
That
after purchase of the asset /property,
the risk of the asset/property is bome by the owners.
·
That
the specification of the asset, delivery schedule and other terms of contract
are fulfilled.
In case of purchase of the
asset/property under Hire Purchase under Shirkatul Melk transaction the
following procedures shall have to be followed:
Obtain deal-wise Request
from the Client for purchasing the asset/property detailing therein the
specification such as Name, Description, Quality, Quantity, Design, etc. of the
asset.
The Bank will examine the
specification of the asset/property and verify the price from the market. Maintain Investment Account
Opening Register (8-102).
Inter the particulars of the Account
in the Investment Ledger(B-72).
It should be carefully noted that
purchase /installation /construction /establishment of the asset shall be made
only after completion of all the Documentation formalities including Pre-Audit
Memo (F- 215/F-218).
Hire Purchase under Shirkatul Melk
asset/property may be purchased and delivery of the same may be taken directly
be the Bank or the Client on behalf of the Bank and for his own behalf from the
Market/Genuine producers /Seller/Suppliers through any authorized
official/agent or by them selves on cash or credit basis.
Hire Purchase under
Shirkatul Melk asset by the bank on credit/deferred payment basis, the bank and
the Client shall execute a purchase agreement with the seller to that effect
mentioning the date of delivery of the asset to the bank and that of payment of
price by the Bank.
Agency commission, if any,
paid by the Bank shall be added to the cost of the asset/property.
If the asset/property are to
be purchased from the local/outstation market and price is to be paid/remitted
through P.O./T.T/DD, etc. the P.O./DD/T.T must be purchased on behalf of the
Bank and the commission thereof and other expenses such as T.A. , D.A,
transportation etc. shall be borne by the Bank, which shall ultimately be
loaded on the cost of the asset/property.
Taking delivery of asset by the bank (hree ) and the (client) hirer :
After finalization of purchase of the
Hire Purchase under Shirkatul Melk asset/property either by the Bank officials
or through any Agent or the Client Agent from the local or outstation market,
the Bank shall request the seller/suppliers to delivery the asset/property
purchase to the Bank’s Authorized Official/Agent/Representative/Client/Bank’s
Godown against proper acknowledgement Accordingly the authorized official
/Agent /Representative /Client shall receive delivery of the asset/property on
behalf of the Bank by signing the Delivery Challan or the Cash Memo/purchase
Schedule which will be in the name of the Bank and the Client.
Hire,Delivery,Sale And Transfer Of
Title Of Asset To The Client
On receipt of the asset, calculate
the total cost price of en same as per proforma mentioning clearly the Banks
& the client’s equity and their respective ownership ration to the asset
(MANUAL, IBTRA).
Share Mechanism
1. Mudarabah
It is a form of partnership where one party provides the
funds while the other provides the expertise and management. The first party is
called the Sahib-Al-Maal and the latter is referred to as the Mudarib. Any
profit accrued are shared between the two parties on a pre-agreed basis, while
capital loss is exclusively borne by the partner providing the capital.
Importer features :
·
Bank
supplies capital as Sahib-Al-Mall and the client invest if in the business with
his experience.
·
Administration
and management is maintained by the client.
·
Profit
is divided as per management.
·
Bank
bears the actual loss alone.
·
Client
can not take another investment for that specific business without the
permission of the Bank (Class, Notes, Hussain, Abul).
2.
Musharaka
An Islamic financial technique that
adopts “equity sharing” as a means of financing projects. Thus, it embraces
different types of profit and loss sharing partnership. The partners
(entrepreneurs, bankers) etc.) share both capital and management of a project
so that profits will be distributed among them as per rations, where loss is
shared according to ratios of their equity participation.
Important feature:
·
The
investment client will normally run and manage the business.
·
The
Bank shall take part in the policy and decision making as well as overseeing
(supervision and monitoring) the operations of the business of the client. The
Bank may appoint suitable person(s) to run the manage the business and to
maintain books of accounts of the business property.
·
As
the investment client shall manage the enterprise, the Bank may pay more share
of profit to him than that of his proportionate capital contribution.
·
Loss,
if any, sha/r be shared on the basis of capital ratio (Class Notes, Abul
Hussain).
Operational
Procedures of Investment Mechanism In Ibbl
Bai-Musharaka
Induction of Client
·
Hold
preliminary discussion with the prospective client regarding his investment
needs, business experience, viability of the project and Shariah permissibility
of the asset the uses business and the uses of the asset.
·
Brief
him on the salient features of Bai-Musharaka mode of investment.
·
Look
to the past performance of the client.
·
Ceck-up
Head Office Current investment policy
and Branch’s track record of Bai-Musharaka Investmentof the items
·
If
the proposal is found permissible under Islamic principles and suitable, advise
the client to submit formal Application (F-167 A). If not found suitable,
regret politely.
·
Request
potential client to open an AI-Wadia Current Account. Let him maintain the
Current Account Satisfactorily for a reasonable period. (This will generally
mean six months).
Application
·
Head
Office Controlled Branches shall obtain Application from the Client in
duplicate.
·
Branches
under Zone shall obtain Application from the clients in Triplicate.
·
Application
shall be Obtained on F-167A as per specimen at page .... Deal Application shall
be obtained on F-136.
·
Obtain
and ajfix attested photograph(s) of the Proprietor /Partners /Directors
/Trustee /Administrator on the top right hand corner of the application .
·
Scrutinize
the application of the client to see that:
A. All columns
are properly filled in.
B. Particulars
and information given therein are complete and correct in all respect.
C. All required
Documents/Papers as listed in the footnote of the application are submitted.
D. The client as per specimen signature with the
Bank signs it.
·
Enter
the application in the "Investment Proposal Received and Disposal
·
Register"(B53)
as per specimen at page... ...and allot a Serial Number to it. Initiate action
for Processing and Appraisal.
Categorization
·
Categorize
the proposal as under :
·
Bai-Musharaka
Commercial
·
Bai-Musharaka
Industrial
·
Enter
the Application in the "Investment Proposal Received and Disposal Register
(B-53) and allot a Serial Number to it.
Initiate action for Processing and Appraisal Immediately
Processing and Appraisal
·
Examine
Shariah permissibility of the goods. Reject the proposal outright, if not
permitted by Islamic Shariah.
·
Check-up
Credit Restriction Schedule of Bangladesh Bank and Head Office Current
Investment Policy Guidelines.
·
Visit
the Business establishment of the Client. Talk to the business and important
personalities of the locality to ascertain the Honesty, Integrity and Business
dealings of the Client.
·
Request
for confidential report of the client from local Bank Branches. Confidential
Report from Credit Information Bureau (CIB) of Bangladesh Bank through Head
Office Investment Division as per Instruction Circular of Head Office In this Regard.
·
Obtain
Financial Statement/Balance Sheet of the Client for the last three consecutive
years for Investment Proposals of TK.50 .00 Lac or above as per Head Office
Instruction.
·
Inspect
Land, Building, other Assets and Properties proposed to be Mortgaged or
Hypothecated.
·
Forward
Documents, Title Deeds and other relevant Papers to the approves Lawyer of the
Bank for examination and furnishing his opinion.
·
Obtain
Lawyer's Opinion as per clause No. 5.07.
·
Please
study the following carefully and note down the actual findings in the
Appraisal Form against each item:
à `Effective demand, price of the goods, Short
or long-term duration, quality and other specifications of the goods,
availability, etc. of the said or projected goods .
·
Whether
sale price of the goods is payable by the client at specified future date in
lump sum or in installments as per proposal.
·
For
Bai-Musharaka Commercial and Bai-Musharaka Indusirial Investment, prepare
Appraisal Report on F-167B. For appraisal Bai-Musharaka agriculture and For
Bai-Musharaka Import use special Appraisal Form devised for each of those, if
any, otherwise F-167B providing the available/required supplementary
information. In course of preparation of the report please ensure incorporation
of all information, particulars figures and statistics in Appraisal Form
correctly with special attention to the following:
à Composition
of assets of the Client, extent and nature of liabilities of the Client, the
value of Liquid Assets, Business Reputation of the Client experience of the
Client, etc.
Contact primarily with the
producers/sellers/suppliers of the goods in the market, study the market price
and work out the purchase and sale prices of the goods as per guidelines.
Sanction
·
On
completion of Appraisal as provided herein above, of the Proposal is found
viable, issue Sanction Advice (F-) if it is within the business power of the
Branch mentioning all the terms and condition in duplicate to the Client and
endorse copies to Zonal and Head Offices retaining one copy in the Client's
file duly accepted by the Client.
·
If
the proposal is not within the Discretionary Power of the Branch, the Branch
shall with Appraisal Report on F-167 A and F-167B to Zonal Office/Head Office.
·
If
the proposal is within Business Power of the Zonal Office, Zonal Office shall
accord Approval/Regret the Proposal.
·
If
the proposal is not within the Business Power of the Zonal Office shall forward
the proposal to Head Office with their views and recommendations.
·
If
the Branch/ the Zonal Office /Head Office, the branch will issue the Sanction
advice (F- 188) with a copy to ZO/HO liuly recorded in 'Facility Sanction
Register (B-119) with authority wise separate opening (Branch/ZO/HO) mentioning
all the terms and conditions in duplicate to the investment Client for the
limit.
·
It
the Client duly accepts the sanction terms arld conditions, enter the
particulars of the sanctioned proposal in the limit Register (8-117) allotting
a Fixed Serial number for each Client as per Limit Register which shall remain
permanent irrespective of the mode(s) so long the Client continues business
with the Bank.
·
Open
file Client-wise, affixing the Fixed Number allotted to him as per Limit
Register (8- 117) and Client's name, address, telephone number be recorded
prominently in the inner side of the investment File for easy tracing in case
of need.
·
In
case of Investment to the existing Client, obtain required papers, document
with the past performance and outstanding liabilities of the Client, if any and
process or sanction the proposal as per
instruction laid down here-in-above after due evaluation or study.
Documentation
Before purchasing the asset/property
by the Bank, obtain sufficient collateral securities as mentioned in the
sanction advice along with the following charge documents properly executed,
i.e. duly filled in, sighed, stamped, verified and witnessed where necessary:
·
Bai-Musharaka
Sanction Advice (F-) deal-wise duly accepted by the Client.
·
Bai-Musharaka
Agreement (as per specimen at page).
·
Joint
and Several D.P. Note (CF-2).
·
Single
party D.P. Note (CF-1), if there is no guarantor.
·
Double
Party D.P. Note (CF-2), if there is guarantor(s) to be made by the Client in
favor of the gurantor and endorsed by
the later to the Bank.
·
D.P.
Note Delivery Letter (CF-3).
·
Letter
of Hypothecation (CF-5) for the asset(s) and client’s stock in
Trade/Work-in-Process.
·
Legal
Mortgage.
·
Letter
of Disclaimer (CF-15), if the goods are stored in Client’s/parry’ own /hired
godown.
·
Agreement
for Pledge of Goods (CF-4).
·
Insurance
Policy (if stored in Client’s /Party’s Godown /Yard under Bank’s effective
control) duly recorded in Insurance Register(B-39).
·
Letter
of Guarantee (CF-14).
·
Balance
confirmation Letter (CF-16).
·
Trust
Receipt (CF-11).
·
Letter
of Installments (CF-17).
If the Investment is made
collaterally secured by Mortage of property, obtain the following document :
In case of Equitable Mortgage, Memorandum of Deposit of
Title Deed (MDTD) signed by the owner of the property.
·
In
case of Equitable Mortgage, Memorandum of Deposit of Title Deed (MDTD) signed
by the owner of the property.
·
In
case of Legal Mortgage, Registered Deed should be obtained.
·
Personal
Guarantee of the owner(s) of the property on CF-14.
·
Original
Title Deed(s) with CS, RS, SA, Mutation Parcha, DCR of the property and
Mutation record.
·
Upto-date
Rent Receipt.
·
Non-encumbrance
Certificate along with Search Fee Paid Receipt of the concerned
Registry/Sub-Registry Office.
·
Site
plan (Map-Naksha) of the Mortgaged Property.
·
Valuation Certificate
issued by a competent Engineer and physically verified by the Branch Officials.
·
Lawyer’s Certificate.
·
All Affidavit sworn.
Where
Hypothecation of Stock-in-trade secures the Investment, Machineries etc. also
obtain the following Documents :
·
Letter of
Hypothecation (CF-5).
·
Trust Receipt
(CF-11).
·
Legal Mortagage of
Machineries.
In case investment is collaterally secured by pledge of
Shares of reputed Public Limited Company on bank’s approved list and quoted in
the stock Exchange, the following additional document are to be obtained :
·
Agreement
for Pledge of Shares
·
Share
Transfer Deed in Duplicate
·
Share
Delivery Letter
·
Letter
to the Concerned Company to register Lien in Bank’s Favor.
In case in investment to Partnership Firms, obtain the
following Document :
·
Letter
of Partnership
·
Copy
of Partnership Deed
In case of investment to Private or Public Limited
Company, obtain the following Document :
·
Certified
copy of the Memorandum and Articles.
·
Resolution
of the Board of Directors.
·
Personal
Guarantee of the Directors
·
Certificated
of Incorporation
·
Certificated
of Commencement
In case of investment to a Trust Organization, obtain the
following Document :
·
Copy
of Trust Deed
·
Resolution
of the Board of Trustees
·
Charge
Document
·
Personal
Guarantee of the Office Bearer
In
case of investment to C-operative society, obtain the following :
·
Clearance
from the Registrar.
·
Letter
to be issued to the concerned Registrar
·
Personal
Guarantee of the Officer Bearer
·
A
copy of Bye-laws of the Society.
Rates
of Stamp Duty.
Signature
of the Client
After
Completion of Document, enter the Document in Documents Execution Register
(B-103).
Movement
of Document, if any, should be duly recorded in the Document Ex-custody
Register duly signed by the Custodians.
Purchase
of Goods by the Bank
·
Remember
that Bai-Musharaka is perfectly a legitimate transaction according tot he Shariah, provided.
Taking
Delivery of Goods/Assets by the Bank
·
After
finalization of purchase of Bai-Musharaka Goods/ASSET either by the Bank
officials on through any Agent from the local or out station market the Bank
shall request the seller to deliver the goods purchased to the Bank’s Autorized
official /Agent or to the Bank godown against proper acknowledgement.
·
After
taking delivery of the goods by the Bank or through and Agent, the Bank shall
make payment of the goods to producers /sellers /supplier through DD /TT /PO
against Cash Memo which will exclusively
be issued in the name of the Bank.
·
DD/TT
may also be issued in the name of the Buying Agent.
·
The
Bank shall not be invest in such cases where the allotting Authority will not
accept the Letter of Authority and agree to deliver the goods to the Bank as
per authorization of this Allottee.
Sale
and Delivery of Goods /Assets to the Client
The Bank after receiving the goods shall finally
calculate the Total Cost price and fix up the sale price by mutual discussion
with Client (MANUAL, IBTRA).
There
are two other modes of investment which have limited impact in our country
(i) Quard
The word "Quard" is an
Arabic word" which means
loan or credit on advance. The literal meaning of Quard is giving
"Fungible goods" for use without any extra value returining those
goods. It must follow the principle of equal for equal return with homogenious
goods. Fungible goods may be rice, oil, salt, money etc. In Banking sector, money
is used as quard. Quard is Halal by Islam for not to pay any extra or interest
in return.
There characteristics of Fungible
goods
- Goods which are vanished /converted for one
time use.
- No flow of service.
- Service can't be seperated from the actual
goods.
Characteristics of Quard
- There should have fungible goods.
- Goods must be returned equally.
- There is no extra payment.
- Specific period for returning goods.
2. Quard-E-Hasana
Quard-E-Hasana is also one kind of Quard which is given
with the expectation of return or not.
Special Schemes
Under Investment Modes
Household Durable Scheme
In a developing country
like Bangladesh people of middle and lower middle class specially service
holders with limited income find it difficult to purchase articles like
refrigerator, television, cot, almirah, wardrobe, sofa-set, pressure cooker,
sewing machine etc. which are part of modern and decent living. They can not
enhance the standard and quality of life to the desired level due to the
constrain of their limited income.
|
Is Bank Bangladesh Limited has, therefore, introduced
Household Durables Investment Scheme which has already created great enthusiasm
among the people and received tremendous response from them.
Objectives
:
·
To
assist the service holders with limited income in purchasing household
durables.
·
Increase
standard of living and quality of life of the fixed income group.
·
Creating
service-holders way of life happy and honest.
Household
articles
·
Furniture
like Almirah, Sufa set, wardrobe, etc.
·
Electric
& electrical equipment like television, refrigerator, gas cooker, air
conditioner PC, washing machine, electric generator IPS, UPS, etc.
·
Construction
of dwelling house like corrugated iron sheet, cement, rod, wood etc.
·
Motor
cycle/By-cycle, Sewing machine etc.
·
Power
generator, motor pump/power pump etc.
·
Gold
ornaments
·
Tube-wells.
·
Mobile
Phone set.
·
Medical
/Engineering Equipment /Machinery.
·
Educational
equipment /machinery, books etc.
·
Any
other items considered by the bank suitable.
Beneficiaries
·
Interested permanent officials of the following
organizations may apply for investment.
(a)
Government Organizations.
(b) Semi-Government Organizations
and Autonomous Bodies.
(c) Banks and Financial Institutions
(d) Armed Forces, BDR, Police and Ansars.
(e) Teachers of Universities, Government Colleges and
Schools and
Senior
Madrashas.
(f) Officers of International Financial & Relief
Organization.
(g) Officers of the multinational companies.
(h) Officer of the local established
and renowned public limited
companies.
(i) Permanent Teachers & Officers
of established & prominent Private
Universities, Medical Colleges & University Colleges.
·
House
Owners.
·
Doctors,
Engineers, Architects, Chartered Accountants/FCMA and other important
professionals.
·
Investment
Client of IBBL.
·
Deposit
Clients of IBBL.
·
Shopkeepers
and businessman.
·
Wage
earners, Panel lawyers of IBBL, C&F Agents enlisted in IBBl etc.
·
Graduate
& Post-Graduate Students of Universities, Medical Colleges, Engineering
Colleges, University Colleges for purchase of PC, Medical/Engineering
Equipment/machinery, Books etc.
·
In
case of Government, Semi-Government and Autonomous Organizations the age of the
investment clients must be 25 and above with at least three years of service and
he must have at least three years of service prior to his retirement. In case
of private organisations, teachers of school, collage and madrashas the age of
investment clients must be in between 30-50, with at least five years of
service and he must have five years of confirm service prior to his retirement
in the same organisation.
·
In
case of others except service holders the age limit must be within 27-60 years.
·
In
case of students the minimum age must be 18 years and maximum 25 years.
Ceiling
of investment
Amount
·
For
doctors, Engineers, Architects, Chartered Accountants, FCMAs the Ceiling of the
investment of the Bank will be –
a.
Dhaka
City : Maximum Tk. 3,00,000.00
b.
Other
Metropolitan Cities : Maximum Tk. 2,00,000.00
c.
Other
Municipal Areas : Maximum Tk. 1,00,000.00
·
For
depositors of Mudaraba Term Deposit & Mudaraba Savings A/C : Maximum Tk.
2,00,000 by liening their a/cs.
·
For
others : Tk. 1,00,000.00
·
NCOs
of Bangladesh Armed Forces, Teachers of Primary Schools, Private School &
Colleges and other professionals : Maximum Tk. 35,000.00
·
For
students : Maximum Tk. 40,000
·
For
personnel of IBBL : Maximum Tk. 75,000
Maturity
of investment
·
Maximum
2 years for beneficiaries except bank's personnel
·
Maximum
3 years for Bank's personnel.
Mode
of Investment : Bai - Muaggl
Equity
·
Minimum
25% of the total value of the articles. The client shall have to deposit the
amount of equity in his Mudaraba Savings /Investment Account with the concerned
branch before the disbursement of investment.
·
Minimum
10% of the total value of the articles for Bank's personnel.
Guarantors
·
For
beneficiaries except Bank's personnel, there shold have two gurantors, one may
be the Boss /colleague in the same level or upper level and the another
gurantor may be husband /wifes parents, brothers etc.
·
For
Bank's personnel, no needs of quarantor.
Charges :
·
For
beneficiaries except Bank's personnel, charges are included as
Profit charge - 13.5%
Supervising - 4.00%
Risk charge - 2.00%
Total - 19.5%
·
For
Bank's poersonnel, profit charge is 11% only.
Disbursement
·
After
sanction of investment and deposit of required equity by the client, the Branch
shall supply to the concerned investment client the desired articles within
seven days by procuring them by way of pay-order/cheque/draft etc. favouring
the supplier.
·
For
ensuring the ownership of the Bank over the goods, all papers and documents
related to the procurement of the goods shall remain in the name of the Bank
and Bank’s sticker shall remain affixed over the same. The ownership shall be
transferred in favour of the client after full adjustment of the dues to the
Bank.
Mode
of Recovery
·
The
Bank’s investments and profit thereon shall be recovered in 24 monthly
installment within a period of 2 (two) years.
·
The monthly installment shall be payable by the
first week of every month. The first installment shall be due for payment in
the first week of the subsequent month of the disbursement /delivery of goods
/articles.
·
Dues
payable to the Bank shall be recovered in the following manner depending on the
nature of the organization and the status of the client :
i.
On
request of the employee, the employer shall product the monthly installment
from the salary and remit the amount to the Bank, in this connection, the
client shall have to furnish a letter of consent from the employer.
ii.
Before
the delivery of goods, the client shall deposit to the Bank 24 post-dated
cheques giving specific dates against each month installment. The cheques shall
be presented to the concerned bank on due dates for encashment and adjustment
of proceeds towards repayment of installment.
Security
The
investment client shall execute/provide the following documents in order to
secure the investment.
·
All
required charge documents as per rules of the Bank.
·
A
written undertaking to the effect that the monthly installments shall be paid
regularly.
·
Personal
guarantee of an official of the same rank or of superior rank. The guarantee
shall have to be duly authenticated by the competent authority of the concerned
organization.
·
Personal
guarantee of another person, preferably family member.
Procedure
for Application
Interested clients shall apply in prescribed form to the
concerned Branch. The application shall have to be duly recommended by the
Divisional Chief of the organisation where the applicant serves. Form and
booklet outlining the rules and procedures of the Scheme may be obtained from
the selected Branches of the Bank on payment of Tk. 25.00 only.
Supervision
of Investment
Under this Scheme, the Bank, at the initial stage, has
engaged M/s. Anudip Services Private Ltd., Ibn Sina Group Investment Company
Ltd., Faisal Investment Foundation and Crescent Consultants on commission basis
for selection of client, disbursement and recovery of investment and for
overall supervision of the Scheme. The concerned investment client shall pay
the commission of the supervising agency at the rate of 2% per annum over the
investment.
Risk Fund
A risk fund shall be created under this Scheme by
charging the investment account @ 2% at a time against total investment at the
rate of 1% per annum for 2 years. In case of any genuine damage or if the
concerned client totally incapable to the Bank, then the amount shall be
covered or adjusted from the risk fund.
Other Terms & Conditions
·
The
concerned Branch of the bank shall take possession of the goods supplied to the
client in case of his failure to repay 3
(three) instalments consecutively.
·
The
client shall bear all necessary expenses relating to lilcense, registration,
insurance etc. of the goods supplied.
·
The
client shall bear cost of all maintenance, repair and preservation.
·
The
client shall bear cost of all maintenance, repair and preservation.
·
The
client shall use and handle the goods with utmost care and he will be liable to
pay for any damage of the articles in his possession due to his negligence,
carelessness and inefficient use. In case of total damage and destruction of
the goods or if it becomes irreparable, the client shall be liable to pay
immediately the balance amount of Bank’s investment including profit.
·
The
client shall use the goods supplied to him personally and under no
circumstances he shall let-out or transfer the possession of the goods to
others without prior written permission from the Bank.
·
The
client shall be bound to allow the Bank’s Authorized agent and representative
to inspect the goods as and when require.
·
The
client, before availing the investment facility, shall execute Bai-Muajjal
agreement and other documents as per investment rules and procedure of the
Bank.
·
The
client must keep the Branch abreast and informed about any change in his
official and residential address.
INVESTMENT
SCHEME FOR DOCTORS
One of the fundamental
rights of every man is to receive necessaty medicare facilities. Majority of
our people are denied and deprived of
this right and a large number of our children are illfed and suffer from
malnutrition and ill health. Subsequently they become victims of various
diseases due to lack of education and knowledge about health care and
preventive measures. Medicare facilities as
a whole are very limited in the country. Although medical facilities
are available to some extent in the cities
|
and towns, majority of the people of
the rural area die without medicare and treatment after prolong sufferings from
various disease.
A
good number or newly graduated doctors from Medical Colleges are
unemployed . Many of the medical graduates are waiting for job because the
opportunity for Government service is limited . If these young doctors could be
self-employed by extending investment facilities, they could make modern
facilities available at the door-steps of rural people.
Besides, experienced and specialist
physicians who are providing Medicare facilities to the people in different
towns with their limited and outdated
medical equipment will be able to improve the standard of their
techniques of treatment and also make the modern treatment facilities available
to more people, if investment facilities are extended to them for procurement
of modern and improved medical equipment . The constitution of Bangladesh had
made it obligatory to ensure good health
for all and the movement is also committed to ensure good health for all by
2000 years.
In view of the above facts, Islami Bank Bangladesh
Limited has taken the initiative an introduced the " Doctors Investment
Scheme" to ensure modern treatment and medical facilities available to the
people through extension of Bank's
investment facilities for self-employment of newly graduated doctors and
at the same time extending investment facilities to the established medical
practitioners to procure modern and sophisticated medical equipment.
Objectives
1. To provide investment facilities for establishment of
chambers, clinics, pharmacies and procurement of medical equipment by the
unemployed medical graduates and thus to provide self-employment.
2. To assist newly passed unemployed medical
graduates to establish clinics by way of
formation of groups by 5 doctors.
3. To assist experienced and established physicians to
procure improved and modern medical equipment and thus to improve the standard
and techniques of treatment.
4. To assist specialists and consultant physicians to
procure specialized medical equipment for extending improved treatment to the
people.
Beneficiaries
1. Newly passed
medical graduates who are willing to establish chambers, Pharmacies and small
clinics in district and Thana level towns.
2. Experienced and
established doctors who are settled in district and other towns but can not
procure modern medical equipment to improve their techniques of treatment .
3. Specialised and
consultant physicians who are willing to procure latest and specialised type of
medical equipment.
4. Newly passed
medical graduates who are willing to form groups in order to establish clinic.
5. Priority is
given to specialists and consultant physicians like dentists , child
specialists, ophthalmologists etc.
Areas
of Investment
1. Establishment cost of Chambers, Pharmacies
& Clinics. Procurement of medical equipment and purchase of Motor Cycle for
visiting patients in rural areas in case of newly passed medical graduates
willing to settle in district and Thana towns under self-employment.
2. Procurement of modern medical equipment by
experienced and established doctors.
3. Procurement of modern and sophisticated
medical equipment and appliances by specialists and consultant physicians.
4. Cost of estabilshment of clinics, purchase of
machinery, equipment, accessories and other goods in case of establishment of
clinics by a group of doctors.
Ceiling
of Investment and duration
Category
|
Maximum Amount (in
Tk.)
|
Maximum Period
|
1. Self
employed doctors in district town
|
5.00 lacs
|
5 years
|
2. Self
employed doctors in Thana town
|
5.00 lacs
|
5 years
|
3. Specialists
/consultant physicians for modern and sophisticated medical equipment
|
10.00 lacs
|
5 years
|
4. Newly
graduatge unemployed doctors group for establishment of clinics /diagnostic
laboratory, machineries, equipments, accessoress and other goods
|
25 lacs for a group of 5 doctors (each 5.00
lacs)
|
5 years
|
Established clinics run by experienced doctors, willing
to expand and improve the standard of their existing medicare facilities by way
of procurement of modern medical equipment, machinery, accessories etc. are
allowed investment facilities on easy terms and conditions. In such cases, the
amount on investment is ascertained considering the location of the clinic, its
reputation, efficiency of the entrepreneurs. The maximum period of investment
is 4 years.
In case of specialists and consultant physicians like
Dentists, Ophthalmologists, Child Specialists etc. The amount of investment
will be double of the normal ceiling. In case of self-employment of newly
passed unemployed medical graduates, special rebate
will be allowed if the Bank’s investment and other
payables thereof are paid within the due period or earlier.
Investment
Mode
·
Hire
purchase Shirkatul Melk: For purchasing of medical equipment and accessories,
motro-cycle and other goods.
·
Bai-Muaggle:
For purchasing chamber, establishment of clinic and Medicines.
Equity
·
New
doctors (under self employment scheme: maximum 10%
·
Established
specialised doctors: minimum 20%
·
Established
clinic /diagnositc centre : minimum 30%
Mode
of Recovery
·
Investment of the Bank is to be repaid on monthly
instalment basis.
·
Re-payment of
the 1st instalment will start after three months from the
date of investment.
·
If any investment client under the scheme fails to pay
back three consecutive instalments without satisfactory reasons acceptable to
the bank for such failure, the bank may take possession and control of the
machinery and equipment etc. Supplied by the Bank .
Security
1. The
ownership of the medical equipment, appliances etc. and the motor cycle
supplied by the bank on Hire Purchase-Shirkatul Melk basis, shall remain with
the bank.
2. Against
Bank’s investment, the clients shall have to mortgage property at least equal
to the value of investment by the Bank. However, in case of investment (other
than clinic) for self-employment of the newly graduated doctors the condition
of mortgage of property may be relaxed, if they are unable to offer mortgage of
property as security against investment. The investment clients shall have to
provide personal guarantee of person(s) acceptable to the bank, in such cases.
3. Original
copy of the graduation and post-graduation certificates shall have to be
deposited with the bank, in case of investments for self-employment of
unemployed doctors.
Procedure
for Application and Sanction
Interested medical graduates shall have to apply in
prescribed form through the nearest branch of the Bank . Bank will accord
Sanction of the investment if the proposal is found viable and acceptable to
the bank after examination if its feasibility.
SMALL
BUSINESS INVESTMENT SCHEME
Bangladesh a third-wood developing country is rich
in natural and human resources. Inspite of vast possibilities, the majority
people of the country livein hardship-below poverty tapped, explored and
exploited. Physical labour is their only means of earning. A large segment of
this populace is active youth force. Many of them are efficient, intelligent
and energetic with initiative & drive and have courage to tale risks. But
they can not uplift their socio-economic condition due to poverty , lack of
financial support and other required facilities. Lack of capital compelled
many small traders to leave their profession. As a result in our country not
only unemployment problem increased but also the young generation is involved in anti-social
activities; thus creating threat to the social life.
|
Aims and objects
·
To expand investment facilities for the small traders
entrepreneurs in urban and rural areas with a view to rasie their level of income and to improve their quality of life.
·
To inspire and encourage unemployed youths to
establish small business enterprises and
thereby to create opportunities for self-employment for ensuring social justice
and welfare of the people in large scale.
·
To extend investment facilities to those small
entrepreneurs who could not avail credit
or investment facilities from any bank or financial institutions or otherwise
depried of from such investment facilities.
Eligibility of the Clients
·
Investment clients must be permanent residents of the
command area of the branch through which they intend to avail investment
facilities and they must have valid trade licence and shops or selling centres.
·
Small business and entrepreneurs who are already
engaged in trade and business but can not run their operations smoothly for
shortage of fund/ capital valid to avail investment facilities under the
Scheme.
·
In vestment shall also be extended to those poor and
asset-less unemployed who are honest, efficient, physically and mentally
capable with drive and initiative,
specially those who have ability to run business.
·
Besides the above categories, investment facilities
under this Scheme shall also be extended to small and cottage industries and
service sector.
Investment Area
All branches of the Bank are eligible to extend
investment facilities under this scheme within 10 (ten) kilometres radious of
the respective branch.
However, for the deserving and justifiable cases the
Management may extend the command area upto a raious of 20 (twenty) kilometres.
Sectors
of Investment
a ) Livestock Rearing of milichcow,
beef fattening , raising and rearing of goats and sheep, poultry, ducks and
pigeons.
b) Fishery
Fish cultivation : excavation,
re-excavation and leasing of pouds for cultivation of fish.
c) Agro-processing
: Cane bamboo and choir products, just bags and jute products, spices, ghee,
molasses, flour making ; oil extraction, sugarcane crushing, paddy and pulses
husking, bee-keeping and honey collection and
processing and handicrafts etc.
d) Manufacturing
Garments making, various typess of workshops, container making ( plastic,
metal, glass etc), and repairing of rickshaw van and hood of rickshaw,
furniture making , quilt and related products making, boat buildign and
repairing blacksmith works bobbin making (plastic, metal etc) manufacturing of
spare parts for handloom, candle making, oil seed crushing machine making,
basket making, household steet iron implements making maufactring of various iron products (wire
nail, wire net etc) rope making , cap making ; chanachur preparation, adhesive
making , making and repairing of bullock-baffalo cart, tanga, ice-eream, school
and other vans.
e) Trading/shop
keeping Rice-paddy, pulse, salt, pepper, vegetables, molasses, firewood,
timber, chicken, fish, dry fish, cattle, banana, onion, betel-nut, seasonal
fruits, bamboo, milk, fertilizer, tea, potato, coconut, spices, stationary,
goods, grocery items, lungi, clothes, saree, mustard seeds and oil, brick,
spareparts, ginger, oil, cake, leather, just products, second-hand clothes,
cotton, peanut, cottonbags, yarn, choir, bamboo made products , slippers and
shoes, seeds and plants, pottery products, seasonal agriculture products,
utensils, wheat, coconut oil, restaurant and hotel honey sugarcane, stove,
silver, fish feed, cattle feed, garlic, various food items, crockery, medicine,
hardware, iron and steel items, sweetmeat , bicycle/ rickshaw/ rickshaw van
parts, glass, watch, electrical goods, books under wears, gamsa, towel, shocks,
handkerchief, leather goods, aluminium and other household items,
homeo-medicine, optical, bakery item etc.
f) Transport Purchase of rickshaw,
rickshaw van, bullock cart, tanga, country boat and motorised boat.
g) Services Laundry, flour mill,
repairing shop and workshop, pumping shop, spice grinding, mill, paddy-pulse
husking mill, saw mill, dying and printing, signboard shop, yarn twisting
factory, watch repairing shop, television, radio and other electronics
repairing shop, refrigerator repairing shop; mustered oil processing shop.
h) Agriculture Implements and
Forestry purchase of hand tubewells, farming and plantation; vegetable garden,
sugarcane, litchi garden, mango and jack-fruit, betelnut, guava, pineapple and
fruit garden; purchase of seed and sapling , silk cocoons, bee-keeping, honey
collection and processing.
i) Miscellaneous Computer for
printing, packing, training and other purposes (except trading), Photostat
machine, graphic camera & contact machine for graphic printing, machineries
of repairing & manufacturing, any other machines for tailoring shop,
machineries for ball pen industry, any other machineries or equipments deemed
suitable by the Branch for income generating activities.
Ceiling
of Investment
·
For
Dhaka and Chittagong city Branches : Maximum Tk. 1,00,000
·
For other
Division /District Branches Maximum Tk. 75,000
·
For
branches other than Division /District : Maximum Tk. 50,000
Mode of Investment
A. Hire Purchase Shirkatul Meelk :
For all kinds of machineries i.e equimpments & transport sector.
B. Bai-muajjal-TR : For trading
shop keeping, agro-processing and raw materials for manufacturing purposes.
Maturity of Investment
·
For
HPSM : Maximum 24 months
·
For
Bai-Muajjle : Maximum 12 months
Equity
·
For
HPSM : Maximum 20% on the total value of equipment /transport
·
Bai-Muajjle
(Tk) : Not applicable
Security
For Investment upto Tk. 30,000.00
·
Hypothecation of existing and future stock of goods .
Ownership of machines & equipments shall remain in Bank's name.
·
Personal guarantee of financially sound respectable 2
(two) persons/ prominent businessmen acceptable to the Bank shall have to be
given.
·
Collateral security may relaxed considering the
feasibility of investment and client's ability and sincerity.
For
Investment over Ik. 30,000.00
·
Hypothecation of existing/ future stock of goods.
Ownership of machines & equipments shall remain in the Bank's name.
·
The client shall have to give mortgage of immovable
properties to the Bank.
Group Guarantee
The
investment clients shall be encouraged to form groups. Each group shall consist
of minimum 5 members. Each member of the group will give guarantee for the
investment of other members of the same group. Thus the members jointly and
severally will remain liable and responsible for the payment of investment.
Procedure for Recovery
·
For
HPSM : Monthly instalment
·
For
Bai-Muojjle (TR) : Monthly /Quartarly /Half Yearly /One payment within maturity
period.
·
For
Investment upto Tk. 30,000 : Monthly instalment for personal guarantee.
·
Post
dated check : Port dated check to be signed by client should be provided to
bank indicating monthly instalment each time for whole period of investment.
Risk Fund
A risk fund is made by bank yearly at
a fixed rate on total value of this type of investment. In case of default of
client, this fund is used for adjustment.
Mudaraba Savings Account
It is compulsory that every client must open a
Mudaraba Savings account. Each client should built savings by way of deposit in
this account a sum of Tk. 10.00 each month for every Tk. 1,000.00 of investment
. No cheque book shall be issued against this account. Money can be withdrawn
from this account if there is no liability against the client.
Supervision
Supervision For effective supervision and smooth
operation of the scheme, required number of supervisors shall be engaged at the
field level. For this purpose the investment client shall have to pay at the
time of investment a sum at the rate of 2% per annum of investment as
supervision fee. In case of investment for 2 years , supervision charge shall
be 4% i.e. 2% per year.
Review and
Evaluation
Review and
Evaluation The concerned branch shall arrange meetings of the investment
clients occasionally and evaluate the performance of the scheme and discuss
problems and take steps to solve those problems.
Procedure for
Application
Procedure of application For availing investment
facilities, investment clients can contact the
nearest branch of the Bank and submit application in prescribed form of
the Bank. The applicant must open two accounts Al Wadea Current Account to
deposit the sale proceeds of the day and a Mudaraba Savings Account to build-up
compulsory savings. The Branch shall taka appropriate steps after thorough
appraisal of the client's investment application.
HOUSING INVESTMENT SCHEME
One of the basic human needs is to have a house to
live in. A house in an abode of peace and happiness. Housing has now become
an acute problem in the country, specially in the towns, cities and
metropolis. With their limited income, it has become almost impossible on the
part of the lower middle class, middle class and sometimes, even for upper
middle class to solve their housing problem. to meet this basic human need,
Islami Bank Bangladesh Limited is committed to contribute to this end to
provide a peaceful and happy.
|
Objectives
·
To extend the benefits of the investment of the Bank
under the Scheme to different sections of the people.
·
To assist in solving the existing housing problem of
the country.
·
To assist the service holder of professionals with
fixed income to arrange for house of their own.
·
To extend and investment facilities of the Bank to
every nook and corner of the country, by size of investment, by sector of
investment and on the basis of geographical area.
·
To make investment facilities easily available under
Islamic Shariah to those people who do not want to avail investment facilities
from interest-based financial institutions.
Beneficiaries
Initially the following categories of people shall be
eligible to apply for; availing
investment facilities under this Scheme:
1. Officials of the
Defense Forces.
2. Permanent
Officials of Government, Semi-Government and Autonomous Organizations.
3. Teachers of the
established Universities, University Colleges & Medical Colleges.
4. Graduate
Engineers, Doctors and established
professionals.
5. Bangladeshi
Officials of reputed Multinational Companies, International Financial
Organizations., Donor Agencies., Foreign Embassies etc.., Officials of local
established & reputed Public Limited Companies
6. Wage earner
professionals like Doctors, Engineers, Accountants, Teachers and any other
profession doing good job abroad with hand-some pay-package.
7. The client
must have exclusive and undisputed possession and ownership title over the land
on which the proposed house will be constructed. The leased property must be on
lease for 99 years and must be legally acceptable for mortgage to the Bank.
8. If the
investment client is a service holder then he must have at least 5 years
un-expired service prior to retirement.
9. Bank will select
the client on the basis of the following criteria: Percentage of Bank's
investment is less than the clients investment: amount of Bank's investment is
comparatively smaller in size, quality of construction & value of the
property; constructed house/apartment is in good location & the price is
reasonable; return from the property (rented income) & other known sources
of income of the applicant; investment servicing capacity of the client is
quite satisfactory.
Target Area
At
the initial stage, the Scheme is being implemented in:
·
Dhaka metropolitan area.
·
Chittagong metropolitan area.
·
Rajshahi metropolitan area.
·
Khufna metropofitan area.
·
Sylhet metropolitan area.
Later
on the Scheme will be implemented in other district headquarters and business
areas in phases.
Scope of Investment
·
Investment is to be extended to build new houses on
the client’s own land, to purchase built houses /apartments /flats and for
extension/ completion of the house constructed/under construction.
·
The building to be constructed on the land must be as
per approved plan of the competent authority of that area, viz. RAZUK, COA,
ROA, KOA etc.
·
The amount of investment will be limited to the
following :
a) For construction of
new building on clients own land : Maximum 60% of the total investment will be
mode by bank which do not exceed Tk. 30,00,000
b) For purchase of
apartment /ftat/ready-made house: maximum 50% of the total investment will be
made by bank which exceed Tk. 20,00,000.
·
If any client intends to provide the following
securities to the Bank duly discharged/ completing necessary formalities by
him, Bank may allow further or additional investment in excess of the aforesaid
ceiling to the extent of 100% of the value of the securities: TOR & Mudaraba
Savings Bond of Islami Bank Bangladesh Limited, TOR/Fixed Deposit of any
scheduled Bank, Wage Earners Bond, ICB Unit Certificates, National/Defence
Savings Bonds/ Sanchaypatra etc., Sank Guarantee from any scheduled Bank.
Mode of Investment : HPSM
Period of Investment
·
The maximum period of investment shall be generally 15
years. However, the period of investment shall be determined on the basis of
the proposal of the client, the amount of investment (for which the client has
applied) and the ability of the project or client to repay the dues.
·
Reasonable gestation period for construction be
allowed considering the size of construction and Bank's investment.
Rent for Bank
Bank's
Rent The Bank, in accordance with its normal practice shall decide rent on the
investment. The clients, who will repay the entire dues in time or before the
stipulated time by way of payment of all due instalments regularly, they will
be allowed rebate on the rent.
Disbursement of Investment
Bank
will pay the sanctioned money through Pay-order directly or through investment
client to the supplier of construction materials/owner of the apartment/owner
of the built. house. However, the following points shall be taken into
consideration in disbursing the investment:
·
In case of purchase of apartment/flat/built house, the
client shall have to deposit the equity money in the Branch or produce
documentary evidence in support of his investment upto the satisfaction of the
concerned Branch.
·
In case of construction of house on the client's own
land or for extension of the existing house, the valuation of the Bank as
regards client’s investment shall be considered final.
·
The client shall have to submit to the Bank, the
construction plan approved by the competent authority and also the required
permission to mortgage the property, where necessary.
·
The client must execute all necessary documents
including mortgage deed and complete all necessary documentation formalities to
a\/ail the investment. Related documents of mortgage, agreement of sale and
other documents must be vetted by the penal lawyer of the Bank.
Procedure for Recovery
·
The client shall have to pay the Bank's dues by
installment immediately after the expiry of the period of construction. To
ensure payment as per stipulation of sanction the client, shall have to deposit
post-dated cheques to the Bank for the amount of each monthly instalments
covering the entire period of investment. The Bank shall realise the amount of
monthly instalment by depositing the cheque of a particular month on the first
week of every month .
·
The client shall have to execute irrevocable power of
attorney in favour of the Bank authorising the Bank to collect monthly rent
from the tenants incase of failure of the client to pay the monthly in
instalment.
Security
·
Personal guarantee of the clients, his/her spouse,
adult son(s) and daughter(s) shall have to be obtained.
·
Mortgage of land and building to be constructed
thereon, apartment /flat/house in favour of the Bank.
·
An undertaking from tile client as well as from the
dependants (nominees) to the effect that tile retirement benefits including
Provident Fund will be appropriated towards adjustment of the house building
investment liability of the client prior to any other appropriation, if the
liability relating thereto or any part of it remains unadjusted at the time of
getting the retirement benefits.
Procedure for Application
Interested
persons shall have to apply in prescribed form of the Bank through the Branch
of the concerned area. The Bank shall sanction investment if the proposal is
found acceptable after examination of its viability and profitability- The Bank
reserves the right to sanction or reject any investment proposal.
Real state Investment Program
Professionals,
Service-holders, Businessmen, Real Estate Developer and other categories of
people who are not entitled for availing investment facilities under Housing
Investment Scheme, shall be eligible under this programme Investment is to be
extended to build new houses and for extension/ completion of the house already
constructed, commercial building, shopping complex, flat apartment etc.
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