Conventional markets and instruments

Classification of financial markets: by types of financial claim, by the maturity of claims..etc The value of intangible asset is derived from the claim to future cash flow. Market participants: investors, issuers, investment bankers..etc
5/6/12

The impact of technological

Islamic money market

Money market serves as a source of temporary financing and an abode of excess liquidity. An alternative to interest-based investment/financing mechanism. Challenge for Islamic money market by development of shariah- compliant instruments 5/6/12 that satisfy the liquidity, security

Islamic money market instruments

Mudharabah Interbank Investment Government Investment Issue Islamic Interbank Cheque Clearing System Sell and Buyback Agreement Cagamas Mudharabah Bonds Islamic Accepted Bills Ar-Rahnu Agreement-I Wadiah Acceptance When Issue Sukuk BNM Ijarah Private Debt Securities

Islamic 5/6/12

Mudharabah Interbank Investment.

v

a mechanism whereby a deficit Islamic banking institution (investee bank) can obtain investment from a surplus Islamic banking institution (investor bank) based on Mudharabah (profit sharing). the period : from overnight to 12 months the rate of return: based on the

v 5/6/12

Government Investment Issue. serious need for interest - free investment avenue to meet the statutory liquidity requirements as well as to park its idle fund Islamic Interbank Cheque Clearing System (IICS). a cheque settlement system for cheque deposits and withdrawals between Islamic commercial banks. Sell and Buy Back Agreement 5/6/12 (SBBA)

Cagamas Mudharabah was introduced on 1 March 1994 by Cagamas Bhd to finance the purchase of Islamic housing debts from financial institutions that provides Islamic house financing to the public. This bond is structured using the concept of Mudharabah where the bondholders and Cagamas Bhd. will share the profits according to the agreed profit-sharing ratios.

5/6/12

Wadiah Acceptance a transaction between BNM and the Islamic banking institutions. BNM uses this instrument to absorb excess liquidity from the Islamic money market. When Issue (WI) a transaction of sale and purchase of debt securities before the securities is being issued.

Sukuk Bank Negara Malaysia 5/6/12 Ijarah (SBNMI)