Key Issues in Asset & Liability Management for Islamic Financial Institutions
SIDC CPE - accredited: 10 CPE Points
Date: 3rd August 2017 Venue: InterContinental, Kuala Lumpur


9.00am – 10.30am Session One: Examining Profit Sharing Investment Accounts, capital Adequacy and Liquidity Management
Profit sharing investment accounts
  • Account structure under Mudarabah arrangement
  • Rate of return risk and displaced commercial risk
  • Smoothing and loss reserves
Capital adequacy and challenges with the IFSB approach
  • The IFSB approach to capital adequacy
  • Incorporating displaced commercial risk in the CAD formula
  • Challenges with the IFSB approach and alternative formulations
Liquidity management and Basel III
  • Changes introduced by Basel III
  • Challenges in meeting liquidity ratios for Islamic banks
Dr Ken Baldwin — Former Director, Financial Policies & Planning, Islamic Development Bank
10.30am – 11.00am Coffee
11.00am – 12.30pm Session Two: Analyzing Hedging Tools, Stress Testing and Systemic Risk in Islamic Banks
Natural hedging as an alternative to derivatives
  • Sharia and other challenges with derivatives
  • Structural approaches to risk reduction
Stress testing for Islamic banks
  • What unique stress tests do Islamic banks need?
  • What are the specific challenges implementing stress testing in Islamic banks?
Islamic banks and systemic risk
  • How are contagion effects different in financial sectors which include Islamic banks?
Dr Ken Baldwin — Former Director, Financial Policies & Planning, Islamic Development Bank
12.30pm – 2.00pm Lunch
2.00pm – 3.00pm Session Three: Examining Specific Risk, Capital Adequacy and Liquidity Management Issues for Islamic Banks in Southeast Asia
  • Discussing risk management for Islamic financial institutions in Southeast Asia: looking at risk beyond Shariah compliance
  • Discussing the key concept of liquidity constraints (due to limited Islamic instruments and market depth) for Islamic financial institutions, and taking steps to effectively manage this issue
  • Examining risk transfer via equity based products as an alternative tool
Azleena Idris — Managing Director and Head of ASEAN, SHAPE Knowledge Services
3.00pm – 3.30pm Coffee
3.30pm - 4.30pm Session Four: Key Structuring and Developmental Issues for Islamic Profit Rate Swaps (IPRS)
  • Reminder on conventional interest rate swap structures
  • Examining important contracts for the development of IPRS – Waad and Murabahah
  • Pricing and valuation issues for Islamic IPRS
  • Identifying real-life challenges
  • Overview of key Shariah and risk management issues
Pavanjit Kaur
4.30pm Q&A followed by Coffee & Networking