Islamic Bank of Maldives

MALE, March 7 (HNS) - Harith Harun, CEO of the Maldives first ever Islamic Bank, Maldives Islamic Bank (MIB) spoke to Haveeru’s Business Editor Ahmed Saeed, ahead of the bank’s opening today, about the bank’s policies and expectations for the future of Islamic Banking in the Maldives.



Ahmed Saeed: How much is the paid-up capital of MIB?

Harith Harun: The initial paid-up capital of MIB is Rf150.0 million which is the minimum capital requirement for banks under the Banking Law.



AS: What’s the specific area of customers that the bank targets? Can the individuals seek the services of the bank?

HH: The bank’s services are not limited to a certain area of customers. This is a bank of fishermen, farmers, businessmen, individuals as well as all those who want a banking service that is in compliant with the principles of Islam.



AS: At the beginning, what are the banking services you will provide?

HH: Like any other commercial bank, we will provide the usual deposit services such as Current Account, Savings Account and Term Deposit Account or what we call General Investment Account. The difference is that these accounts will be structured in accordance with the Islamic concepts with no pre-determined interest rates. Instead we will fix the Profit Sharing Ratio and that means profit earned from the utilization of these deposits by the bank (less the amount placed with the MMA as minimum reserve requirement) will be shared with the depositors based on the agreed ratio after deducting expenses.

The bank will also provide credit facilities, or what we term as ‘Financing Facilities’ to businesses and individuals for various productive purposes such as for purchase of goods, equipment and machinery, working capital, project financing, purchase and construction of houses and flats, vessels and others. The financing will be structured in the form of Murabahah or Sale, Ijarah(Lease) or Musharakah (Equity Participation) or a combination of two or more of these financing structures.

Apart from Deposit and Financing, we will also provide trade finance services for importers and exporters, remittances service both domestic and international, bank guarantee, and other ancillary services.

We plan to launch ATM service by the middle of the year.



AS: What is the minimum amount required to open a new account?

HH: The minimum initial deposit to open a Savings Account is Rf1,000 for a Rufiyaa account and US$100 for a US$ account. To open a Current Account the minimum initial deposit is Rf2,500 or US$250 for individuals and Rf5,000 or US$500 for companies. For General Investment Account the minimum deposit is Rf5,000 or US$500.