Regulators & Supporting Institutions
Islamic financial institutions are authorized and supervised by the regulator in the country in which they operate. In addition, there are two standard-setting bodies: AAOIFI and IFSB. There are also supporting institutions. Click on each of the below institution to have a detailed explanation for their role.
- The Accounting and Auditing Organization for Islamic Financial Institutions (known as AAOIFI) was founded in 1990. AAOIFI is based in Bahrain and is non-profit corporate body serving as a standard setter for the Islamic financial institutions. AAOIFI issues standards on: accounting, auditing, governance, ethics and
- AAOIFI FAS 38: “Wa’ad, English]
- AAOIFI FAS 37: "Financial Reporting by Waqf Institutions" [English].
- AAOIFI FAS 36: "First Time Adoption of AAOIFI Financial Accounting Standards”[English].
- AAOIFI FAS 35: "Risk Reserves" [English].
- AAOIFI FAS 34: "Financial Reporting for Sukuk holders" [English].
- AAOIFI FAS 33: "Investment in Sukuk Shares and Similar Instruments" [English].
- AAOIFI FAS32: "Ijarah" [English].
- AAOIFI FAS31: "Investment Agency (Al-Wakala Bi Al-Istithmar)" [English].
- AAOIFI FAS30: "Impairment, Credit Losses and Onerous Commitments" [English].
- AAOIFI FAS 28 "Murabaha and Other Deferred Payment Sales" [English][Arabic].
Auditing Standards for Islamic Financial Institutions (ASIFI)
- AAOIFI ASIFI 6:"External Shari’ah Audit (Independent Assurance Engagement on an Islamic Financial Institution’s Compliance with Shari’ah Principles and Rules)" [English].
Governance standards for Islamic Financial Institutions (GSIFI)
- AAOIFI GS 13: "Waqf Governance" [English]. Guidance Note for Governance Standard 13 [English]
- AAOIFI GS 12: "Sukuk Governance" [English].
- AAOIFI GS 11: "Internal Shari’ah Audit" [English].
- AAOIFI GS 10: "Shari’ah Compliance and Fiduciary Ratings for Islamic Financial Institutions" [English].
- AAOIFI GS 9: "Shari’ah Compliance Function" [English].
- AAOIFI GS 8: "Central Shari’ah Board" [English]. "الهيئةالشرعيةالمركزية" [Arabic].
Ethics standards
- AAOIFI "Code of Ethics for Islamic Finance Professionals" [English]
- Full Standards(November 2017) "Shari’ah Standards for Islamic Institutions-Full text" [English].
- "Shari’ah Standard No. 57 on Gold and its Trading" [English][Arabic].
Guidance notes
- "Auditing Guidance Note (AGN) No. 02 “Auditor’s Report” [English].
General Council for Islamic Banks and Financial Institutions (known as CIBAFI) is a non-profit organisation based in Bahrain. Its role is to support Islamic financial institutions though activities and initiatives. CIBAFI was founded in 2001 by the Islamic Development Bank (IDB). CIBAFI is comparable to the British Bankers Association (BBA) in the United Kingdom.
Countries reports
- Kazakhstan Islamic Finance Report 2016 [English]
- Malaysia Islamic Finance Report 2015 [English]
- Morocco Islamic Finance Report 2014 [English]
- Oman Islamic Finance Report 2015 [English]
- Sudan Islamic Finance Report 2016 [English]
- Tunisia Islamic Finance Country Report 2013 [English]
- Turkey Islamic Finance Report 2014 [English]
The Islamic Financial Services Board (known as IFSB), is based in Malaysia and is an international standard setter for Islamic financial institutions. IFSB issues global prudential standards and guiding principals for the Islamic finance industry.
Published standards
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- IFSB_26 (December 2021) "Core Principles for Islamic Finance Regulation (Financial Market Infrastructures)" [English]
- IADI_IFSB (July 2021) "Core Principles for Effective Islamic Deposit Insurance Systems [English] [Arabic]
- IFBS_25 (December 2020) "Disclosures to Promote Transparency and Market Discipline for English]
- IFBS_24 (December 2020) "Guiding Principles on Investor Protection in Islamic Capital Markets" [English]
- IFBS_22 (December 2018) "Revised Standard on Disclosures to Promote Transparency and Market Discipline for Institutions Offering Islamic Financial Services (Banking Segment)"[English] [Arabic].
- IFSB-21 (December 2018) "Core Principles for Islamic Finance Regulation (Islamic Capital Market Segment)" [English] [Arabic].
- IFSB-20 (December 2018) "Key Elements in the Supervisory Review Process of English] [Arabic].
- IFSB-19 (April 2017) "Guiding Principles on Disclosure Requirements for Islamic Capital Market Products (Sukuk and Islamic Collective Investment Schemes)" [English] [Arabic][French].
- IFSB-18 (April 2016) "Guiding Principles for English] [Arabic] [French]
- IFSB-17 (April 2015) "Core Principles for Islamic Finance Regulation (Banking Segment)" [English] [Arabic] [French]
- IFSB-16 (March 2014) "Revised Guidance on Key Elements In The Supervisory Review Process of Institutions Offering Islamic Financial Services (Excluding Islamic Insurance (English] [Arabic] [French].
- IFSB-15 (December 2013) "Revised Capital Adequacy Standard for Institutions Offering Islamic Financial Services (Excluding Islamic Insurance (English] [Arabic].
- IFSB-14 (December 2013) "Standard on Risk Management for English] [Arabic].
- IFSB-13 (March 2012) "Guiding Principles on Stress Testing for Institutions offering Islamic Financial Services" [English] [Arabic].
- IFSB-12 (March 2012) "Guiding Principles on Liquidity Risk Management for Institutions offering Islamic Financial Services" [English] [Arabic] [French].
- IFSB-11 (December 2010) "Standard on Solvency Requirements for English] [Arabic].
- IFSB-10 (December 2009) "Guiding Principles on Shariah Governance Systems for Institutions offering Islamic Financial Services" [English] [Arabic] [French].
- IFSB-9 (December 2009) "Guiding Principles on Conduct of Business for Institutions offering Islamic Financial Services" [English] [Arabic] [French].
- IFSB-8 (December 2009) "Guiding Principles on Governance for English] [Arabic].
- IFSB-7 (January 2009) "Capital Adequacy Requirements for Sukuk, Securitisations and Real Estate Investment" [English] [Arabic].
- IFSB-6 (December 2008) "Guiding Principles on Governance for Islamic Collective Investment Schemes" [English] [Arabic].
- IFSB-5 (December 2007) "Guidance on Key Elements in the Supervisory Review Process of Institutions offering Islamic Financial Services (Excluding Islamic Insurance (English] [Arabic].
- IFSB-4 (December 2007) "Disclosures to Promote Transparency and Market Discipline for Institutions offering Islamic Financial Services (Excluding Islamic Insurance (English] [Arabic].
- IFSB-3 (December 2006) "Guiding Principles on Corporate Governance for Institutions offering only Islamic Financial Services (Excluding Islamic Insurance (English] [Arabic].
- IFSB-2 (December 2005) "Capital Adequacy Standard for Institutions (other than Insurance Institutions) offering only Islamic Financial Services (IIFS)" [English] [Arabic].
- IFSB-1 (December 2005) "Guiding Principles of Risk Management for Institutions (other than Insurance Institutions) offering only Islamic Financial Services (IIFS)" [English] [Arabic] [French].
Technical notes
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- TN-3 (December 2019) "Technical Note on Financial Inclusion and Islamic Finance" [English].
- TN-2 (December 2016) "Technical Note on Stress Testing for Institutions Offering Islamic Financial Services (IIFS)" [English] [Arabic]. The user guide for TN-2 is available in [English] and in [Arabic].
- TN-1 (March 2008) "Technical Note on Issues in Strengthening Liquidity Management of Institutions Offering Islamic Financial Services: The Development of Islamic Money Markets" [English].
Guidance notes
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- GN-7 (December 2019) "Guidance Note on Sharî`ah-compliant Lender-Of-Last-Resort Facilities" [English] [Arabic].
- GN-6 (April 2015) "Guidance Note on Quantitative Measures for Liquidity Risk Management in Institutions Offering Islamic Financial Services (Excluding Islamic Insurance (English]. [Arabic] [French].
- GN-5 (March 2011) "Guidance Note on the Recognition of Ratings by external Credit Assessment Institutions (ECAIS) on English] [Arabic].
- GN-4 (March 2011) "Guidance Note in Connection with the IFSB Capital Adequacy Standard: The Determination of Alpha in the Capital Adequacy Ratio for Institutions (other than Insurance Institutions) offering only Islamic Financial Services" [English] [Arabic].
- GN-3 (December 2010) "Guidance Note on the Practice of Smoothing the Profits Payout to Investment Account Holders" [English] [Arabic].
- GN-2 (December 2010) "Guidance Note in Connection with the Risk Management and Capital Adequacy Standards: Commodity Murabahah Transactions" [English] [Arabic].
- GN-1 (March 2008) "Guidance Note in Connection with the Capital Adequacy Standard: Recognition of Ratings by External Credit Assessment Institutions (ECAIs) on Shariah-compliant Financial Instruments" [English] [Arabic].
The International Islamic Financial Market (known as IIFM) was founded in 2002 in Bahrain. IIFM is a non-profit corporate body that provides Sukuk.
Below is the list of IIFM Standards
- Liquidity Management Standards – 1, 5, 6
IIFM Standard 1: Master Agreements for Treasury Placement (MATP)
IIFM standard 5: Inter-Bank Unrestricted Master Investment Wakalah Agreement (UMW)
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- Inter-Bank Unrestricted Master Investment Wakalah Agreement (UMWA) [English] [Arabic] [French]
- IIFM Wakala Operational Guidance Memorandum [English] [Arabic] [French]
- Minor Amendments to the Inter-Bank Unrestricted Master Investment Wakalah Agreement [English]
- Client Briefing (Clifford Chance LLP) [English]
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IIFM standard 6: Master Collateralized Murabaha Agreement (MCMA)
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- Master Collateralized Murabaha Agreement (MCMA) [English] [Arabic]
- Operational Guidance Memorandum [English] [Arabic]
- Minor Amendments to the Master Collateralized Murabahah Agreement (September 2015) [English]
- Key Features and Scope of the IIFM Shari’ah Board Review and Guidelines of the MCM Agreement [English]
- Client Briefing (Clifford Chance LLP) [English]
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Hedging Standards – IIFM Standard – 2, 3, 4, 7, 8, 9 & 10
IIFM standard 2: ISDA/IIFM Tahawwut (Hedging) Master Agreement (TMA)
IIFM standard 3: ISDA/IIFM Mubadalatul Arbaah (MA) (Profit Rate Swap) – Single Sale
IIFM standard 4: ISDA/IIFM Mubadalatul Arbaah (MA) (Profit Rate Swap) – Two Sale
IIFM standard 7: ISDA/IIFM Islamic Cross-Currency Swap (ICRCS)
IIFM standard 8:ISDA/IIFM Islamic Foreign Exchange Forward (IFX Forward) – Single Binding Wa’ad based Standard
IIFM standard 9:ISDA/IIFM Islamic Foreign Exchange Forward (IFX Forward) – Two Unilateral and Independent Wa’ad based Standard
IIFM standard 10: ISDA/IIFM 2017 Credit Support Deed for Cash Collateral (VM)
Financial Trade Standards – IIFM Standard 11 & 12
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- IIFM-BAFT Master Funded Participation Agreement [English] [Arabic].
- IIFM-BAFT Master Unfunded & Funded Participation Agreements – Operational Guidance Memorandum [English] [Arabic]
- IIFM-BAFT Master Unfunded & Funded Participation Agreements – Structure Memorandum [English] [Arabic]
- Baker McKenzie Client Briefing – Master (Unfunded and Funded) Participation Agreements [English]
Sukuk Standard-IIFM Standard 13
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- Sukuk Template- Prospectus [English]. نشرة اإلصدار [Arabic]
- Sukuk Template – Sale and Purchase Agreement [English] [Arabic]
- Sukuk Template – Lease Agreement [English] [Arabic]
- Sukuk Template – Service Agency Agreement [English] [Arabic]
- Sukuk Template – Purchase Undertaking [English] [Arabic]
- Sukuk Template – Sale and Substitution Undertaking [English] [Arabic]
- Sukuk Template – Declaration of Trust [English] [Arabic]
Sukuk reports
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- IIFM Sukuk report- 8th edition (July 2019) "A Comprehensive Study of the Global Sukuk Market" [English].
- IIFM Sukuk report- 7th edition (April 2018) "A Comprehensive Study of the Global Sukuk Market" [English].
- IIFM Sukuk report- 6th edition (July 2017) "A Comprehensive Study of the Global Sukuk Market" [English].
- IIFM Sukuk report- 5th edition (March 2016) "A Comprehensive Study of the Global Sukuk Market" [English].
- IIFM Sukuk report- 4th edition (November 2014) "A Comprehensive Study of the Global Sukuk Market" [English].
- IIFM Sukuk report- 3th edition (2013) "A Comprehensive Study of the Global Sukuk Market" [English].
- IIFM Sukuk report- 2th edition (2012) "A Comprehensive Study of the Global Sukuk Market" [English].
- IIFM Sukuk report- 1st edition (2011) "A Comprehensive Study of the Global Sukuk Market" [English].
The International Islamic Liquidity Management Corporation (known as IILM) is based in Malaysia and is an international organization that creates and issues Islamic instruments (such as IILM sukuk) to facilitate Islamic liquidity management. IILM was established in 2010 by the Islamic Corporation for the Development of the Private Sector (known as ICD) as well as several central banks and monetary authorities.
The inaugural Sukuk issuance took place in 2013 and raised USD 490 million. This short term Sukuk (3 months) was rated A-1 by Standard & Poor’s.
The Islamic Research and Training Institute (known as IRTI), established in 1981, is a member of the Islamic Development Bank (known as IDB or IsDB). IRTI is one of the biggest research and training institutes in the world. IRTI publishes books and research and offers learning and training programs in Islamic finance.
- Some IRTI publications:
- IRTI "Business Models In Islamic Microfinance" [English].
- IRTI (2013) "قانون الخدمات المالية الإسلامية بماليزيا" [Arabic].