Structuring Islamic Repo & Hedging Instruments

Structuring Islamic Repo & Hedging Instruments
A Three-Part, Online Program

Date: 14^th - 16^th November 2022

WHY THIS COURSE?

Islamic financial institutions face the same everyday risks as all other financial institutions – credit, market, operational and liquidity risk. However, with limitations being placed on the development and use of hedging tools to help manage key risks such as liquidity risk, Islamic financial institutions find themselves at a considerable disadvantage.

There are, however, solutions available. Shariah equivalents of hedging tools and repurchase agreements are achievable and are in widespread use today in various parts of the world. What are these products, what do they achieve, how are they deployed and how are they structured? These are common questions, that deserve clear and logical responses.

This 9-hour online program will provide you with a clear understanding of the issues and challenges at hand, with relevance to Islamic hedging and liquidity management and the development of Shariah compliant repos.

Key Learning Objectives:
- Understand the Islamic finance market and what hedging tools are currently available.
- Assess the challenges of hedging and liquidity management in the Islamic finance market.
- Identify the work and position of key standard setters and regulators – AAOIFI, IIFM and IFSB – and what this means for market development.
- Understand what Tahawwut is and why it is so important.
- Evaluate structuring and Shariah issues for Islamic hedging tools.
- Understand what repurchase agreements are and how Islamic alternatives can be structured and applied.
- Discuss the practical technicalities of Shariah compliant repo and hedging.

Fee

1 participant: RM2,500/$600
2 participants: RM5,000/$1,200
3 participants: RM7,500/$1,800
4 participants: RM10,000/$2,400
5 participants: RM12,500/$3,000

Discounts are available for group bookings. Please contact us for more details.

In-house/group training

If you are looking for an in-house training program or wish to send a group to an existing public program, kindly please contact Andrew Tebbutt at [email protected] or +603 2162 7802.
Learn More

For enquiries please contact:

Normariya Sariman
Account Manager, REDmoney Seminars
[email protected]
Direct Line: +603 2162 7800 ext 44

Ramesh Kalimuthu
Events Sales Director
[email protected]
Direct Line: +603 2162 7800 ext 65
Fax: +603 2162 7810

For sponsorship & speaking opportunities:

Andrew Tebbutt
Managing Director
[email protected]
Direct Line: +603 2162 7802

For marketing and media enquiries

Govina Selvanthran
Marketing Manager
[email protected]
Direct Line: +603 2162 7800 ext 22

Structuring Islamic Repo & Hedging Instruments
A Three-Part, Online Program

Date: 14^th - 16^th November 2022

6.00am - 9.00am
UK

10.00am - 1.00pm
UAE

2.00pm - 5.00pm
Singapore/KL

WHY THIS COURSE?

Key Learning Objectives:
- Understand the Islamic finance market and what hedging tools are currently available.
- Assess the challenges of hedging and liquidity management in the Islamic finance market.
- Identify the work and position of key standard setters and regulators – AAOIFI, IIFM and IFSB – and what this means for market development.
- Understand what Tahawwut is and why it is so important.
- Evaluate structuring and Shariah issues for Islamic hedging tools.
- Understand what repurchase agreements are and how Islamic alternatives can be structured and applied.
- Discuss the practical technicalities of Shariah compliant repo and hedging.

WHO WILL BENEFIT?

Chief risk officers
Chief financial officers
Financial risk managers
Treasury sales professionals
Treasury and ALM professionals
Risk analysts
Financial analysts
Credit portfolio managers
Asset managers
Corporate bankers
Shariah advisors
Supervisors, regulators and risk standard setters

Program Format

This three-part training program will be delivered online through a stable, secure and free-to-access platform. The program itself will be delivered through lectures, worked examples and case studies in order to ensure a detailed and practical understanding of the program content. Participants will have plenty of opportunity to ask questions and interact with the program director. Login details and program materials will be sent to participants upon receipt of payment

Fee

1 participant: RM2,500/$600
2 participants: RM5,000/$1,200
3 participants: RM7,500/$1,800
4 participants: RM10,000/$2,400
5 participants: RM12,500/$3,000

Discounts are available for group bookings. Please contact us for more details.

In-house/group training

If you are looking for an in-house training program or wish to send a group to an existing public program, kindly please contact Andrew Tebbutt at [email protected] or +603 2162 7802.
Learn More

AGENDA AND FORMAT

Each session will be interactive in a seminar format, with participants encouraged to engage with questions throughout.

PLATFORM

AGENDA

Part One (3 Hours)

Session one: Role of Standard Setters and Regulators

Role of standard setting and regulatory bodies.
Conventional standard setting and regulatory bodies.
Islamic finance standard setting and regulatory bodies.
Collaborative roles of Islamic and conventional standard setting and regulatory bodies.
Joint projects.

Session Two: The Conventional Financial Markets, Derivatives and Hedging

Market completeness of conventional financial markets.
What is a derivative and what is hedging?
Derivatives as a corporate tool – applications and uses.
Conventional financial derivatives.
The settlement process of derivatives.

Session Three: Non-permissibility of Conventional Derivatives and Hedging In Islamic Finance

Market completeness and the Islamic financial markets.
Uses of derivatives as a corporate tool - applications and Shariah perspective.
What can not be a derivative and hedging tool under Islamic finance.
Financial derivatives offered by Islamic financial institutions.
Is there some consensus from a Shariah perspective?

Session Four: Tahawwut

What is acceptable risk?
Risk hedging motives in Islamic finance.
What Is Tahawwut?
Uses of Tahawwut.
IIFM Tahawwut Model.
Key features.

Part Two (3 Hours)

Session One: AAOIFI, IIFM Framework and IFSB on Hedging and Repo

Islamic Finance, repurchase agreements and hedging.
AAOIFI Shariah Standards.
Pre-requisite to undertake Islamic hedging and repos.
Understanding key AAOIFI definitions.
Combination of contracts.
The IIFM Framework.
The IFSB position on repo and hedging.

Session Two: Islamic Hedging Structures

Islamic hedging instruments.
Islamic profit rate swaps.
Tawarruq - Islamic profit rate swaps.
Islamic cross currency swaps.
Tawarruq – Islamic hedging IPRS and ICCS – how settlement is made.
Islamic Forward Rate Agreement (IFRA).

Session Three: Islamic Repo Options – Definitions, Structures and Applications

Repo – the AAOIFI definition.
Basics of repurchase agreements.
Repos as part of the derivatives market.
Repo and reverse repo.
Permissible uses and applications of repo.
Islamic alternatives for repo and reverse repo.
Repo – Tawarruq.
A regulatory overview:
- State Bank of Pakistan.
- UAE Central Bank.
- Bank Negara Malaysia.
International Islamic Liquidity Management Corporation (IILM).

Part Three (3 Hours)

Session One: IFSB Regulatory and Supervisory Stance

Uses of hedging instruments.
Leading hedge strategies and a comparison of each.
Important jurisdictional overviews.
Regulatory and supervisory issues – the Islamic Financial Services Board.
Discussing IFSB policy stance and recommendations.

Session Two: Analysing and Applying IIFM Hedging Standards

ISDA/IIFM Tahawwut (Hedging) Master Agreement (TMA).
ISDA/IIFM Mubadalatul Arbaah (MA) (profit rate swap) – single stage sale Standard.
ISDA/IIFM Mubadalatul Arbaah (MA) (profit rate swap) – double stage sale Standard.
ISDA/IIFM Islamic Cross-Currency Swap (ICRCS).
ISDA/IIFM Islamic Foreign Exchange Forward (IFX forward) – Single Binding Wa’ad based Standard.
ISDA/IIFM Islamic Foreign Exchange Forward (IFX forward) – two unilateral and independent Wa’ad based Standard.
ISDA/IIFM 2017 Credit Support Deed for Cash Collateral (VM).
ISDA/IIFM IBOR Fallback Standard Documentation.

Session Three: Practical Technicalities of Shariah Compliant Repo and Hedging

Repo in practice:
- Shariah and Challenge of ground zero dynamics
- Key takeaways
Hedging In practice:
- Shariah and challenge of ground zero dynamics
- Key takeaways

Conclusion and Wrap-up

EXPERT COURSE DIRECTOR

Mohammad Aamir
Islamic finance practitioner

Mohammad Aamir is an Islamic finance practitioner with over 20 years of diversified conventional and Islamic finance and investment banking industry experience. Aamir is a chartered management accountant and has worked as a project related consultant for AAOIFI, developing governance standards on syndicated financing. Aamir has been associated with Islamic Finance news (a REDmoney Group publication) since 2009 and is currently IFN’s global Islamic structured finance correspondent. Aamir has held senior positions at several reputable organizations, including the financial advisory arm of a big four accounting firm. Aamir has undertaken pioneering work in the Islamic and conventional financial industry and has extensive experience of structuring off-balance Islamic project financing vehicles. In conventional finance, Aamir has structured complex securitization and bond issuances involving credit enhancement features. Aamir has in-depth exposure to equity and debt structuring and fund raising, securitization, M&A and valuation, Islamic finance and Sukuk, structured finance, credit ratings and alternative asset classes such as private equity and REITs. Aamir has worked extensively with internationally renowned Shariah scholars.