The Tale of a Proselyte

Islamic Banker From a

for a glossary on Islamic Finance (by

the way this was my first unintended
head-on

with

the

CIMA

Islamic

Conventional Lender to an

Finance). Back then, to me, the move

Islamic Financier

to an Islamic Bank was nothing more

then a career diversification, adding

By Muhammad Arsalan

few attractive bullets to my cv, and

I was a busy-as-a-bee corporate banker,

naturally to my career prospects as

happily

well.

bogged

working

capital

in

to

structuring

lines,

export

refinancing, retiring import liabilities

and funding large scale projects. Back
then, it looked fulfilling and somewhat
convenient

experience

underwriting

financing facilities, rationalized by the

few renowned C's of credits including
credit worthiness, collateral, cashflows,
capacity etc. In essence, all I use to do
is to lend money and get it backed

Nevertheless, it doesnt took me more

then a month's time to realize that,
there is a lot more to it then mere
arabic terms. Being a front office
banker, it takes you to be a go-getter
not only in your interaction with the
client, but also with the inhouse
quarters of the bank, most importantly
the risk approvers, and that required
me to come to grip with the tricks of

timely, and not to forget the accrued

interest, that my principle must have

the

trade.

Something

that

"All I

baffled me in the early days,

needed to fret about was my

was the client's curiousity in

exposure on the borrower

not only knowing an Islamic

and his ability to repay it,

Banks offerings, but also in

irrespective!"

my ability to differentiate it

earned during the period.

from
It was some four years back, that I
serendipitously landed in to an Islamic

the

conventional

products. I was to hear out

Bank with the delusion that, it is a

the

similar business with a few arabic

business model, and then

jargons to master, and may be some

incremental

documentation

complexities. So, expectedly, I googled

customer

need,

his

craft a shariah compliant

financing

facility
|Page1

thereagainst to fulfill his

requirement, and lastly but

risk of the inventory/assets financed

was to be taken care of, in addition to
the legacy credit/counterparty /default

most importantly sell it to

risk. Assets leased have to be on my

the sanctioning authority to

balance sheet along with all its risk and

get it going. It was not a 'one

cannot just be treated as a liability

size fit all' proposition, as there

were contracts (defined by Islamic
commercial

law)

underlying

each

owed by the lessee. Along this time,

going through the 'getting my hand
dirty' phenomenon, I recognized that

limitations,

do not have the luxury to

sharing

offer liability rollover to my

covenants. There were inherent and

clients with a mere debit-

product,

with

prohibitions

their
and

risk

implied rights and obligation, risk and

rewards

for

each

phase

of

the

credit punch-in and cannot

transaction. I was also told that Shariah

carry on with financing their

Compliance is the USP (and perhaps

financing mismatches.

the niche) of this form of financial

timing

intermediation, and therefore to be

reporting

observed as nothing less than being

transaction were also an altogether

sacrosanct. The intimidating fact of it

was that, the

of

recognition
and

of

The

profits,

presentation

of

different ball game.

non-conformity to
the

Feeling a bit like on the edge, I was

income from the transaction to be

pretty sure that its time to roll my

cleansed in to charity funds.

sleeves up and go for some professional

shariah

underpinnings,

leads

qualification to stand the pace. I found

Following

my

intuitive

the comprehensive and well rounded

recognize that it is not just the

CIMA Islamic Finance qualifications

almost all of

apparently offered me the apt learning

shareholders but

pursuit,

the left-hand-side (funding

side) of the balance sheet

and

skill

proposition,

with

its

curriculum encompassing the Islamic

Commercial Law, Banking Products,

was operating on profit loss

Takaful,

sharing basis.

Securtization, Accounting Standards

Moreover, on the

right-hand-side(lending side) market

and

Islamic

most

Capitlal

importantly

Markets,

Shariah
|Page2

Governance settings. Besides being a

key enabler to my Islamic Banking
career - the legacy and the global brand
of CIMA as a professional body, serves
you a 'stand out' advantage. Lastly,

the

colorful

and

aesthetically pleasing study

guides, crisp and candid
content

with lots of real

world cases, excercises and

thought prompt made it a
fairly

engaging

learning

expedition.
A

lot

of

people

from

varying

backgrounds, functional roles and skill

requirements

approach

me

for

suitability and effectiveness of CIMA

Islamic Finance qualifications, so I
thought I should come up with an
objective matrix presentation of how
various modules of CDIF fulfil the
respective
prominent

learning

requisitions

professional

roles

of
and

Industry segments.

|Page3

|Page4

Though, quite self explanatory, lets

needs to be well versed with deposit

discuss few examples to make it simple.

products,

Taking the case of a RELATIONSHIP

mudaraba, wakalah, the mechanism of

OFFICER, tasked to mobilize deposits,

income

the

contract

determination

of

and

waad,

profit

|Page5

distribution.

The

Islamic

Banking

and skepticism - are keen to

nd

Products (2 ) module amicablly gets

this done!

know the discerning risk and

reward,

Moving to senior business side roles

like BRANCH MANAGERS, who is

rights

and

obligation and vis--vis legal

expected to be at ease with Islamic

enforcability,

implied

Banking products (both for deposits

covenants

various

and financing) and operational and

phases of the transaction. For

accounting

treatment.

The

Islamic

Banking Products (2nd) and Accounting

Standard Module (4th) would turn him
confident in it.

such

an

across

entirety

Commercial

Law

the

Islamic

module,

Islamic

Banking Product Module and the

Islamic Capital Market Module would

On the more technical functions, like

that of TREASURY MANAGERS, it is
the liquidity management, Interbank
wakalah, commodity murabaha and
Tawarruq

based

arrangements,

that

liquidity
would

interest

do the trick.
I also have tried to ensemble the
qualification's

utility

for

personnel

from other associted industry segment,

like

Law

firms,

rating

agencies,

regulators and academia etc.

them. Besides, dealing in intricate

Islamic Structured Products, hedging

It goes without saying, that Ideally its

instruments,

the

currency

Salams

and

whole

Diploma

and

Advance

other market risk mechanisms are sort

Diploma, that gives you panoramic

of an errand to a treasury manager. The

view and the knowledge edge, and the

Islamic Banking Products (2nd) module

module mapping

and

Islamic

Capital

Market

(3rd)

Module matches to these learning

requirement. Both of these module are
befitting

for

CORPORATE

AND

INVESTMENT BANKERS as well.

The

RISK

SANCTIONERS

UNDERWRITERS with their

provides the respective focus of a

certain module.
To wrap it up, I can safely claim that, it
was CDIF that turned my voyage from
a conventional banker to an Islamic

MANAGERS,
and

under discussion

the

Financier, in to a happening and

gratifying experience.

lucid

lense of risk, pinch of salt

|Page6

Muhammad Arsalan is a qualified and

experienced Islamic Banker specializing in
Shariah compliant product structuring,
corporate lending, Credit risk assessment,
project finance having served both
conventional
and
Islamic
Financial
institutions.
After obtaining his Bachelor of Engineering
degree from NED University, Arsalan
pursued his MBA from Institute of Business
Administration Karachi. He is a qualified
CDIF from CIMA, UK. He brings with him
years of experience of structuring corporate
lending
products
including
shariah
compliant modes of Murabaha, Salam,
Istisna, Ijarah and Sukuk covering sectors
like commodities, coal, edible oil, Textile,
Rice ,Food Grain Processors, Tannery and
Sugar Manufacturers, Ethanol, FMCG,
Pharmaceutical,
Distributions
and
automobile
assemblers
sector.
He has been serving as a Faculty and
corporate trainer in premier organizations
like Institute of Bankers Pakistan,
PAFKIET, SZABIST, DUBAI Islamic Bank
etc. Arsalan has contributed numerous
international and domestic training
programs and courses on Islamic Banking,
Islamic Accounting Standards, Credit
Analysis and corporate finance etc. His
article on Islamic Finance Career Prospects
and learning needs has recently been
featured by CPI Financials (global
circulation over 150,000)

|Page7