shari’a philosophy

general shari'a policies


The objective of the Shari'a policies is to provide guidelines for the Shari'a function of the Bank.


All operations of the Bank's Islamic window shall follow Shari'a guidelines as expressed and outlined by the Shari'a Supervisory Board (SSB).

detailed description

The SSB is required to prepare a report on annual basis to the Shareholders and depositors/investment account holders of the Bank regarding the extent of the Bank's compliance with Shari'a regulations. This report has to be issued prior to the release of the Bank's published annual accounts.

The responsibility for complying with Shari'a guidelines rests with the management of the Bank. The management of the Bank will conform to Shari'a guidelines and enable necessary controls to ensure compliance.

The Shari'a Monitoring and Review Department (SMRD) will mainly carry out the following activities:

  • Shari'a compliance review;
  • Shari'a review;
  • Advice on issues relating to Shari'a compliance; and
  • Liaison in matters involving the Shari'a Supervisory Board.

The SMRD must have complete and unhindered access to all records, transactions and information from all sources including professional advisers and the Bank's employees. It is the management's responsibility to provide the SMRD and Shari'a Supervisory Board with all the information relating to the Bank's operations and compliance with Shari'a guidelines.

The SMRD and Shari'a Supervisory Board will not undertake operational activities of the Bank.

The SMRD shall maintain adequate records of all its correspondence with the Shari'a Supervisory Board and the business and operations team of the Bank.

Applicable Laws and Regulations

The scope of the business activities of the Bank with regard to Shari'a will be regulated by:

  • Shari'a guidelines (as stipulated and interpreted by the Shari'a Supervisory Board);
  • Guidelines issued by Central Bank of Oman (CBO); and
  • Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) standard on Accounting and Shari'a Compliance.

In the event of additional laws or regulations becoming applicable to the Bank in the future, the SMRD will ensure that all appropriate Shari'a policies and procedures are updated to reflect the same.

In the event that the local laws / specific needs of the land require procedures that would conflict with the mandatory instructions specified by the manual, special case has to be presented to Shari'a Supervisory Board for evaluation and approval. Any exceptions / changes to the mandatory instructions have to be appended to the manual for further reference.

Key Activities of the Bank

The key activities of the Bank for which the Shari'a Monitoring and Review Team will conduct a compliance review and provide advisory services will include the following:

  • Consumer Banking Operations
  • Corporate Banking Operations
  • SME Banking Operations
  • Wholesale Banking Operations, and
  • Support Functions (Human Resources, Marketing, IT, Legal, etc.)
charity fund policy

The Bank shall create a charity fund in which income from late payment and/or nonpayment of overdue instalments will be credited. In addition, any non Shari'a compliant income received by the Bank will be credited in the charity fund.

The amount in this fund shall be used for charitable and social welfare purposes in line with the SSB's policy.

The Bank shall maintain proper records with regard to the charity fund and disclose in the annual report a statement of sources and uses of charity fund.

Bank will make effort in disbursing the amount in the charity fund in the current year. However, exceptions can be made subject to SSB approval.

SSB shall oversee/monitor the operations and activities of the charity fund.

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