In the past two years, the IIFM has launched standard contract templates for Islamic interbank transactions
and profit rate swaps.
The code lists practices that should be followed by banks while serving customers, dealing in interbank transactions
, market conduct, advertising, relations with regulator, recruitment and development of UAE national staff and the overall management of banks.
Summary: Citibank will no longer be part of the panel of the Emirates Interbank Offered Rate, or Eibor, the group that fixes the interest rates charged by lenders for interbank transactions
The capital control law passed by the legislature last Friday gives the regulator the power to: restrict cash withdrawals; ban premature termination of time deposits; mandate a compulsory reprogramme of maturing time deposits; ban or restrict opening new accounts; convert current accounts into time deposits; ban or restrict non-cash transactions; restrict use of credit, debit or prepaid cards; ban or restrict cashing cheques; restrict interbank transactions
or transactions within the same bank; restrict transactions between the public and credit institutions; and restrict movement of capital, payments and transfers.
which are allowed include mudaraba, musharaka and wakala placements.
A global poll of CFA Institute members suggests that rates set on actual interbank transactions
are the most appropriate methodology for setting LIBOR.
It is used to price financial contracts around the world, ranging from complex interbank transactions
to consumer mortgages and student loans.
The Collateralized Murabahah will be a new low credit-risk financial instrument that enables collateralized interbank transactions
in the Islamic Money Market in the country, the central bank said in a statement.
Saidi said, "The establishment of the IIBR marks an important milestone in the maturation of Islamic money markets by providing an international reference rate for interbank transactions
He said that while interbank transactions
had been Sharia-compliant, in each transaction there was a feeling that the level of return was being set by traditional interest rates.
The new system is based on the rate of return on capital used by Islamic banks, representing the average profit rate at which bids are made for sharia-compliant interbank transactions
, such as murabaha and wakala deals, between top Islamic financial institutions.
The National Bank is making interbank transactions
and all transactions of the Treasury related to payment of pensions, salaries and allowances will be made in full.