Islamic Banking and Finance

Discussion in 'Business and MBA degrees' started by Kizmet, Dec 9, 2016.

Loading...
  1. Johann

    Johann Well-Known Member

    As I said, Visa issues both Shari'a-compliant credit cards and interest-bearing ones. And so does MasterCard. Google "Islamic Visa" or "Islamic MasterCard."
    And if he wants to, the infidel Johann can invest in a sukuk (Islamic security) any time he wishes. And so can you. Must admit, I was surprised to hear about the home financing for non-Muslims. The two agencies I looked at in Canada both specified that their plans were strictly for Muslim customers. Thanks, Steve.

    J.
     
    Last edited by a moderator: Dec 14, 2016
  2. Johann

    Johann Well-Known Member

    Looks like non-Muslims in Canada or U.S. can have *Riba-free home purchase contracts. Or maybe I neglected to research fully, before. A quote from this site, https://ijaracdc.com/

    "Even though the ‘Lease to Purchase’ program was specifically designed to meet the religious obligations of Muslims, it is made available to all qualified people in the United States and Canada that are interested in a Sharia Compliant Financing Product."

    *Riba - variously translated as interest, usury, unequal exchange . . .

    J.
     
    Last edited by a moderator: May 24, 2017
  3. Johann

    Johann Well-Known Member

    And here's an interesting Islamic financing deal: In a Sharia-compliant contract structured by a German bank, Ford Motor Co. sells Aston Martin to a consortium led by British racing entrepreneur David Richards. Why must the transaction be Islamic? Because Mr. Richards' financial partners are Kuwaitis.

    Oh yes - and one of our Canadian "Big 5" banks intends to set up an Islamic Financing division... Watch the others scramble! :smile:

    https://www.theglobeandmail.com/report-on-business/rbc-plans-to-enter-islamic-finance-market/article1056849/

    J.
     
    Last edited by a moderator: May 24, 2017
  4. Johann

    Johann Well-Known Member

    And here's a well-known, long-established Manitoba Credit Union that is offering Sharia-compliant mortgages to anyone who's qualified. They even spelled musharaka right (in English letters.) :smile:

    https://www.assiniboine.mb.ca/Personal/Borrow/Mortgages/Islamic-Mortgage/

    No, I guess you don't have to be a Muslim, to transact financial business by Islamic rules. Sorry, jhp. I disagree on this point - way too much evidence to the contrary.

    J.
     
    Last edited by a moderator: May 24, 2017
  5. Johann

    Johann Well-Known Member

    Indeed not. More proof. Here's some info on Global Iman Fund, a Shari'a-compliant Mutual fund operating in Canada. https://www.theglobeandmail.com/globe-investor/funds-and-etfs/funds/summary/?id=75940

    This is not a solicitation or a suggestion that anyone should buy shares. Just proof that it's (widely) available - and certainly, not just to Muslims.

    J.
     
  6. Kizmet

    Kizmet Moderator Staff Member

  7. Johann

    Johann Well-Known Member

    This is good. Al Huda (means "right guidance" - a word from Qur'an) and INCEIF are both big names in Islamic financial education.

    J.
     
    Last edited by a moderator: Jun 24, 2017
  8. Johann

    Johann Well-Known Member

    This is just news - not intended as an ad or solicitation for any firm named.

    There are well over a million Muslims here in Canada - roughly the same number as in the U.S. Here, they represent about 3.2% of the population. Financial services providers are starting to serve this growing market segment. Large, well-known Assiniboine Credit Union is Winnipeg offers musharaka (partnership) mortgages. These are halal, no-interest, rent-to-own (diminishing rent and increasing equity) loans. The Credit union states that anyone who desires such a loan may apply - not necessary to be Muslim.

    https://www.assiniboine.mb.ca/Personal/Borrow/Mortgages/Islamic-Mortgage/

    I commented a while ago on one Canadian halal mutual fund. Here's another new, less-traditional entry. I see nothing that says non-Muslims aren't welcome. I'm sure they are.

    https://beta.theglobeandmail.com/globe-investor/funds-and-etfs/wealthsimple-launches-halal-portfolio-for-observant-muslims/article36063749/?ref=http://www.theglobeandmail.com&

    I'm thinking that many Muslims in Canada are doing/will do well financially and have a need for halal, riba-free savings and investment vehicles, retirement plans, mortgages, credit etc. Maybe it's a good time to invest a little money in the companies themselves - those that provide these specialized services. But that's just me. I'm not saying you have to. It's not an ad...and I'm not a financial guru. :smile:

    J.
     
    Last edited by a moderator: Aug 28, 2017
  9. nosborne48

    nosborne48 Well-Known Member

    Interesting! "Riba" sounds like one (of several) Aramaic terms used in Talmud to describe (illegitimate) interest on debt. The Aramaic term translates roughly as "the bite". Large swaths of the commercial law parts of the Babylonian Talmud identify (and condemn) dozens of presumably common work-arounds for the Torah prohibition against charging or paying interest (between Jews). The prohibition is so broad that I wonder if even the Muslim ban stretches so far. For example, if I loan you money and take possession of your orchard as collateral, I may use the fruit only if I deduct its value from the balance owed. It is basically IMPOSSIBLE under ancient Jewish law to receive any form of passive income from investments. No silent partners, no corporate shareholders, no bonds or debentures, nothing of any sort that will result in getting back more than you loaned. It is even forbidden to deal in "futures". No price may be set in advance of the harvest market lest the price at sale be higher than the price agreed upon in advance.

    Of course, the reason Gemara spends so much time "in the weeds" is that people were (and are) charging and paying interest all over the place. (smile)
     
  10. Johann

    Johann Well-Known Member

    "Riba" in current Islamic sense is usually taken to mean interest, usury, or unequal exchange. Interesting that the basic meaning is "the bite." IIRC "la mordida" in Spanish (the bite) means a bribe. :smile: The prohibitions don't seem to be as extensive as Talmudic law, by a long shot. Workarounds are common - and there are many approved ones. Holding corporate shares is no problem, provided the companies are engaged in halal businesses - no gambling, pork, alcohol, weapons etc. There are halal mutual funds, so I guess there have to be companies they (and individuals) can hold shares of. Futures trading? Well, limited-OK. Here's a piece on that: Futures: Halal or Haram? | Ilm Fruits You'll see that speculation per se is always haram.

    It's OK to invest in companies that owe money at interest, as long as they owe no more than 30% of their capital. Bonds are OK - provided they are structured according to Islamic rules. Those are called "sukuk."

    A common work-around is for a lender to purchase goods, mark up the price and sell to the consumer with a payment schedule that reflects the new price. I believe Islamic credit cards - VISA, MasterCard etc. work that way.

    In summary, it appears that Islamic rules are less stringent than the Talmudic rules. Established workarounds are codified and commonly used, with encouragement rather than condemnation.

    J.
     
    Last edited by a moderator: Sep 1, 2017
  11. nosborne48

    nosborne48 Well-Known Member

    Yes, la mordida is the "expected contribution". Canadians probably don't have a slang term for bribery, the idea being utterly foreign to the Canadian mindset? (large grin)

    In Jewish law, rent of fields or personal property IS permitted but rent of money, you might say, isn't.
     
  12. SteveFoerster

    SteveFoerster Resident Gadfly Staff Member

    Agreed. They really do seem to take the approach that anything not explicity forbidden is permitted, and the spirit of the rules be damned.
     
  13. Johann

    Johann Well-Known Member

    Plenty of bribes, here, but nothing for the little guy, like me. Like the lottery - big payouts, but I'll never see one. Here's one of the latest:

    https://www.thestar.com/news/canada/2017/08/24/ex-federal-bridge-president-sent-to-jail-for-accepting-bribes-from-snc-lavalin.html

    A French-Canadian slang(ish) term for bribe, I'm told, is "pot-de-vin." Pretty lowball bribe, if you ask me...

    J.
     
    Last edited by a moderator: Sep 3, 2017
  14. Johann

    Johann Well-Known Member

    Indeed. I read a bit about Halacha (traditional Jewish law) and the word used for (illegitimate) interest was "ribbis." I wouldn't doubt that Islamic "riba" and Jewish "ribbis" share a common source, 'way back.

    From quora.com "There are certainly features of Arabic, including structural and phonological (sound) properties of Arabic, which suggest that Hebrew Aramaic and Arabic are sister-languages, sharing features which differentiate them from other living and extinct Semitic languages." (Emphasis mine - J.)

    I love digging into word origins. All the things I love doing have one thing in common - no money in 'em. None at all. :smile: That's OK.

    J.
     
    Last edited by a moderator: Sep 6, 2017
  15. nosborne48

    nosborne48 Well-Known Member

    "ribbis" ends with a "t" sound in Sephardi (and Modern Israeli) pronunciation so I learned it as "ribbit".

    I am no expert but I think Temple-era Hebrew was a dialect of the more generally spoken Aramaic. It seems to me, looking into dusty memories, that Syriac and Chaldean are also Aramaic languages. Phoenician is in there, too, somewhere. Jesus probably spoke Aramaic primarily in preference to Hebrew. I assume he spoke at least some Greek and Latin as well. Certainly Mel Gibson thought so.

    I know that a basic knowledge of Classical Hebrew can carry the student some way toward understanding Talmud Aramaic. There are differences of course but the grammar is similar and many words are the same. Pronunciation is different but not wildly so.
     
  16. Johann

    Johann Well-Known Member

    Nosborne, I don't know much about Hebrew or Aramaic - just enough to know that you are absolutely right. I once compared the Aramaic and the Hebrew versions of the Lord's Prayer - written and oral - and there were indeed similarities. The Internet makes such things so easy!

    You mention Phoenician. IIRC, they are the trading people we have to thank for the origins of European alphabets - both Roman and Greek. Indeed, looks like I was right for once -- here's the Wiki. https://en.wikipedia.org/wiki/Phoenician_alphabet In 1955, when I was 12, my first-year Latin teacher gave us an overview of how languages developed. We learned the Phoenician, Greek and Hebrew alphabets from him, and I managed to learn Cyrillic, mostly from postage stamps around the same time. I have never forgotten this wonderful teacher.

    J.
     
    Last edited by a moderator: Sep 15, 2017
  17. nosborne48

    nosborne48 Well-Known Member

    It is endlessly interesting. I wonder if, at some point in the far distant future, researchers will identify our time as the emergence of "Emoji" as a language.
     
  18. Johann

    Johann Well-Known Member

    I think those assumptions are well-founded. Greek was the lingua franca of the land at that time, especially in the ports - and Romans governed and policed, so...

    I asked Kermit - he agrees. :smile:

    J.
     
  19. Johann

    Johann Well-Known Member

    The future is now. Looks like they already have.

    https://www.theguardian.com/technology/2014/aug/31/emoji-became-first-global-language

    If you Google "emergence of emoji as a language," you'll have a very very busy morning, to say the least! :banana: :shock: :smile: :laugh: :banana:

    J.
     
    Last edited by a moderator: Sep 16, 2017
  20. Johann

    Johann Well-Known Member

    I'm necromancing this thread for two reasons: my continued interest in Islamic finance and my love of juicy stories involving big money and crime.

    It seems there are two people who have been called "the Muslim Madoff." One is Pakistani-American Syed Qaisar Madad, now serving 12 years for a Ponzi scheme involving $49 million. Here's an article on him: http://www.ponzitracker.com/main/2013/7/3/muslim-madoff-gets-12-year-sentence-for-49-million-ponzi-sch.html

    The other is Omar Farooq Kalair, a Toronto businessman. I believe he is a Canadian of Egyptian origin. He stands accused of siphoning off 4.3 million dollars from an Islamic mortgage operation, converting about 1.9 million of the take to gold and making it disappear. The following article was written on the first day of his trial, in Nov. 2017. The next day, he fired his lawyer, thereby securing almost a full year of delay. The trial resumes in Sept, 2018. Here's his story. http://www.cbc.ca/news/canada/toronto/omar-kalair-muslim-madoff-shariah-mortgages-1.4390002

    My take: We don't need any more Madoff imitators - of any religious persuasion, or even none at all. Good to see at least one locked up. Hope the other one gets his in due course. They're lucky they're not getting a Shariah-compliant punishment!

    J.
     
    Last edited: Jan 23, 2018

Share This Page