Islamic Structured Finance Service

Creative and Shariah-compliant structures and mechanisms to bridge the gap between fund and project requirements.The financing is done under Islamic contract named Hire Purchase under Shirkatul Melk (HPSM)

Features and Benefits

  • Wide range of Shariah-compliant products and services
  • Best local know-how to cater your needs
  • Structured capital market transactions to optimize investment returns and reduce effective funding costs.

How does it work?

  • The bank and the customer will contribute equal or unequal portion to the project and own them jointly which is known as Shirkatul Melk.
  • The bank will then rent out its portion of the asset to the customer under Ijarah (lease) contract and the customer will pay monthly rent for that portion.
  • Additionally, the customer will buy back the portion of the bank buy paying principal which will be included in the monthly payment.
  • When customer makes the last rental payment, the full ownership is transferred to the customer.

Shariah Pronouncement

﴿بسم الله الرحمن الرحيم﴾

الحمد لله رب العالمين، والصلاة والسلام على رسول الله، وعلى آله وصحبه أجمعين.

All praise to Allah and May peace and blessings be upon his messenger, his family, his companions and all followers of his guidance.

Shariah Structure of the Product

  • This is a combination of partnership, lease and sale contract named Hire Purchase under Shirkatul Melk (HPSM).
  • Bank and customer jointly buys the asset under partnership contract by providing equal or unequal amount
  • Bank leases its portion of the asset to the customer for a specific period and customer pays monthly rent.
  • Customer gradually buys Bank’s share of the asset.
  • At the end of the contract the ownership of the asset is transferred to the customer.

Approval of Shariah Supervisory Committee

The Shariah Supervisory Committee of City Bank has reviewed Structured Finance Facility documentation, related contracts and process.

Therefore, We the “Shariah Supervisory Committee” for City Bank confirm that in our opinion the “Structured Finance Facility” is in accordance with the partnership, sale and lease principle of Islamic finance and hence we allow the bank to provide this product to its customer.

And Allah Knows Best.

Dr. Md. Anwar Hosain Molla

Shariah Supervisory Committee, City Bank
This certificate was signed on Tuesday 11th May 2021