The newest star of the Islamic finance sphere, LB Finance Al Salamah, wishes the Islamic community all the very best for the festival season and a bountiful year ahead. Offering a wide range of financial services including Shari'a-compliant investment accounts and leasing, Al Salamah works hand-in-hand with a well-respected Shari'a Supervisory Council.

"Al Salamah represents safety, security and integrity," said Al Salamah Head S. H. M. Faraaz. "All our operations are fully monitored by a qualified Shari'a Supervisory Council to ensure that everything we do is one hundred percent within the Shari'a Law. Right now we have four main products, Mudarabah Investment Accounts, Murabaha Trade Financing, Ijarah Leasing and Ar Rahn Gold Loans, all of which have enjoyed great response from the public since we launched," he said. Al Salamah further plans to boost their already impressive array of Shari'a-compliant services in the near future with several new products, including asset-backed trade financing.

"Islamic finance doesn't just create cash," said Faraaz. "For every disbursement of cash, an asset of similar value is also released to the market and therefore there is no effect on inflation. In fact the only countries that survived or had the minimum impact of the recent world economic recession were the countries where Islamic finance was doing very well, with Malaysia and the Middle East being the best examples," he said.

The key strengths behind Al Salamah's success are threefold. Al Salamah is backed by LB Finance's 40 years of expertise, giving it a major advantage in the market. Furthermore, Al Salamah is not only monitored by a highly experienced and learned Shari'a Supervisory Council, it is also sanctioned by the Monitory Board of the Central Bank of Sri Lanka. "This is a key factor of our credibility and the security we offer, as we are operating strictly within the laws of the country as well as Shari'a Law," said Faraaz. "In fact, there is now scope for Islamic finance in the Banking Act as well as within the recent amendments to it," he said.

The basic principles of Islamic finance involve two parts, raising the capital and doing business. Both these aspects have to be Shari'a-compliant in an Islamic finance institution; adhering to one of these parts alone does not make it a fully-compliant Islamic finance institution. "We have done in-depth studies and referred to the opinions of world-renowned Sharia'a scholars on the subject of compliance," said Faraaz. "Based on our findings, the initial capital of Al Salamah was raised through a Mudarabah investment (deposit) by LB Finance PLC. This is just like any other deposit in an Islamic finance institution and is the commonly practised method at present to raise the capital, approved by Shari'a scholars," he said.

In addition to these measures, Shari'a-compliance is further promoted by the way Al Salamah has been structured to keep its operations independent from the main body of LB Finance. "We maintain independent accounts including a separate profit and loss account," said Faraaz. "For all the services LB Finance is providing, the unit will be making a payment for them. We will even go to the extent of paying LB Finance for every cup of tea consumed by the staff of the unit. That is the amount of respect we have for Shari'a Law," he said.

According Faraaz, Al Salamah is currently planning to move its head office to a new location which has been identified in Maradana. "We will be moving to an independent location within the next month or two," he said. "The new premises will house our operations separately from those of LB Finance and will include a prayer room for our customers. This building will be one hundred percent dedicated to Al Salamah and no conventional finance operations will be carried out here, giving us added Shari'a-compliance," he said.

Al Salamah services are available to the public across the country via LB Finance's islandwide branch network. "Since Islamic finance is based on equity and fair play, it is completely user-friendly," said Faraaz. "It therefore has convenient solutions for your every financial need, and anyone, irrespective of religion, race or gender, can avail the benefits of it. The entire Sri Lankan public is welcome," he said.

Courtesy: DailyNews

Posted on Friday, September 10, 2010 @ 07:48:55 LKT by SaNDuN

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