Fadi YazbeckT24 Islamic

Strategic Goals

Why

Competition

Islamic Banking

• Offer the Islamic Banking solution across all banking areas – PWM, Corporate and Retail

• Deliver the best Channels solution to support this• Build Islamic Window for addition market share

*EY – World Islamic Banking competitiveness report – 2013 to 2014

Islamic Banks will need to employ technology to address high operational cost. Flexible solutions with advanced channels, BI and Private Wealth will make the difference

Source: IDC The impact of Technology On Islamic Banking in Middle east and Africa.

• Fastest growing banking sector in the world 17.6% CAGR*

• Very Mobile oriented but mobile banking in infancy • We were the leader – others catching need to re-

innovate our Islamic Brand

Oracle Path SolutionsInternational Turnkey SolutionsOthers – small (Mysis etc)

How we fair in Islamic

QISMUT – biggest area of oportunityQatar, Indonesia, Saudi, Malaysia, UAE, Turkey

Other potential markets

Islamic banks moving fast

Regulatory reforms for Islamic Banking

Ex USSR statesUnited Kingdom Nigeria, Kenya, Uganda, Tanzania

New Markets

GermanyPhilippines Zimbabwe, Malawi

LibyaSingapore Morocco, Algeria, Tunisia

Islamic BankIslamic Window

Conventional Banking

ConventionalBanking

Types of Islamic Banks

• 2 Separate companies• Separate Accounting• No mixing of funds• Consolidation at reporting level

• Fully Shariaa compliant transactions• Fully Shariaa compliant terminology

Roadmap – dependent on core changes

2014 2015

Q1 Q2 Q3 Q4Q1 Q2 Q3 Q4

• Diminishing Musharaka• Modaraba financing• New profit distribution module

• Murabaha Personal Finance • Services Ijarah Overdraft• Islamic Deposit Plan• Islamic structured Deposits

New LC financing package covering:Murabaha LCMusharaka LCMusawama LCIjara LC

• Profit free Loan• Double PFX

• Wakala Murabaha S basis scheduling for rate revaluations

• Back dated revaluations• Construction finance

management of contractors• Ijarah SL

• Islamic in AA

• Accrual during construction period

• Enhancements to What if scenario

• SIB/QIB

Keep ahead of

competition

• Ijarah Floating rate • Flexible schedules for murabaha • Shareholders for PDS• Bulk Trading enhancements for

Islamic credit cards

Istisna / Parallel Istisna

Separate Asset Request for Each Contractor

Multiple asset requests handling under one contract

Asset Purchase for the total request amount

Asset purchase done for entire asset request amount

Retention from Bill Payment

Ability to Record and Retain % of Bill Payment to Contractor(s)

Ability to Reverse the Retention Amounts

Only Balance Amount to be Transferred to Contractor

Retention Kept in Internal Account to be Disbursed to Contractor upon Receipt of Completion Certificate

Corporate Mudaraba

Booking of Commitment

Contingent entries raised for placement of Mudaraba facility

Options to amend the commitment details

Finance Booking

Finance booking fully integrated with commitment record for the facility

Reversal of commitment (contingent) entries

Complete and partial reversal of contingent entries done based on disbursed amounts

Declaration of Actual Profit

Ability to book finance on expected profit basis

Upon actual profit realization, same can be recorded

Adjustment entries passed automatically to nullify the expected and actual profit rate difference

Corporate Mudaraba

Recording of Non-Sharia Compliant Income

Ability to record non-Sharia compliant portion from income generation

Automated process to transfer non-compliant income portion to charity account

Fully integrated accounting process for recording and booking of non-Sharia compliant income

Impairment Recording Functionality

Ability to record written down value of financed assets

Proportionate reversal of impairment entries in case of written up financed assets

Other Features

Standard T24 Model Bank features to cover:

a. Customer Repayments

b. PD Processing

c. Provisioning

d. Financial Write Off

Diminishing Musharaka

Profit Declaration Function

Ability to record bank and customer profit sharing % separately

Automated process of paying upfront profit to customers

Ability to record actual profit/loss scenarios and relevant accounting treatment

Other Features

Standard T24 Model Bank features to cover:

a. Customer Repayments

b. PD Processing

c. Standard Finance Amendment Options

Flexible Murabaha Schedules

Profit Booking on ‘S’ Basis

Principles and Profit Split in Repayment Schedule

Ability to split profit between bank’s income and charity in past due treatment

Flexibility to define repayment schedules

Other Features

Standard T24 Model Bank features to cover:

a. Customer Repayments

b. Standard Murabaha Finance based Amendment Options

c. PD Processing

LC Issuance and Financing

Introduction of Major Islamic Products for LC Finance

Below products introduced to cover financing requirements of Letter of Credits:a. Murabaha LC Financeb. Musharaka LC financec. Musawama LC Financed. Ijarah LC Finance

Booking LC Issuance and Finance Details in One Screen

LC Issuance and Finance synchronized

User friendly tabs to record complete LC details within one screen for all types of LCs, i.e., Sight, Usance, Mixed Payments and Negotiation

Ability to Add LC Charges and Commissions to Finance Amount

Feature of recording charges at Issuance Stage

Charge collection routed through Internal Account

Finance booked for Principles + Profit + Charges amount

All other standard financing features also available for LC financing

Profit Distribution System

Enhanced Feature for Profit Calculation and Booking

‘Profit Rate’ field in Mudaraba deposit input screen will be non-input field

During booking of Mudaraba deposits, T24 will default the ‘Profit Rate’ to the last periods profit announcement rate.

Daily Accruals for Mudaraba deposits will happen on the last period announced profit rate.

During PDS process (Simulation and calculation), T24 will raise accounting entries to adjust the accrued profit against the calculated profit.

New Treasury Products and Enhancements in Existing Products

Islamic Deposit Plan (IDP)

Based on Reverse Murabaha process flow (Liability Product)

Trade base transaction to comply with Sharia Principles

Short term investment product handled through buying and selling of commodities in local and/or international markets

Enhanced features to record Master Murabaha Agreement, asset request/purchase, broker accounting and report/advice generation

Murabaha Customer Finance (MCF)

Based on Commodity Murabaha process flow (Asset Product)

Product to cater customer’s urgent liquidity needs

Options of repayment through bullet payment or agreed repayment schedule

Ability to generate single Master Murabaha Agreement for multiple MCF deals

New Treasury Products and Enhancements in Existing Products

Islamic Structured Deposit (ISP)

Based on combination of Murabaha and Bai Al-Arboon

Multi-product structure to comply to Sharia principles

Two successive Murabaha Investment transactions

Profit for both transactions derived from purchase and sale of Sharia compliant commodities at pre-determined profit rates

Profit Free Loan

Predominantly based on Qard Hassan Doctrine

Ability to parameterize ‘Early Payment Period’

Reversal of recorded profit If repayment made within ‘Early Payment Period’

Normal Profit is applied if repayment made after grace period

New Treasury Products and Enhancements in Existing Products

Enhanced Bulk Tawarruq Features

Enhanced features to handle single and bulk purchase of commodities like:

a. Broker Account Details and Broker Accounting

b. Inventory Management of Commodities

c. Commodity Blocking

d. Enhanced Management and Broker Fees Functionalities

Roadmap – Un-committed

2015 2016

Q1 Q2 Q3 Q4Q1 Q2 Q3 Q4

• Islamic Window for additional market share

• Islamic BI Model Bank• Islamic Risk reporting

• Murabaha Syndicated financing

• TCIB Islamic interface

• T24 Islamic Private wealth

Additional

Market

Additional

Market

• Islamic banking in the cloud Additional

Market

• Islamic Window (Africa request)

• Islamic Segment Specialisation• Corporate• Retail• Private

• Islamic Microfinance

• Islamic Finance companies

• Islamic SPV’s

• Incremental new products• Corporate Syndications• Retail Composite Products and Liab’s

• Islamic Trade Finance – New Products

• Islamic Treasury – front office

• Islamic Finance Origination

2017 to 2018 – Islamic Banking

Create Additional Market Share Incremental Change to keep ahead

Full Islamic model bankProminent Shariaa advisors and advisory boardSupports innovation and excellence in serviceFlexible product building and innovation capabilitiesDelivery channelsLeading core banking solution and full support for MIS and risk reportingTier 1 Islamic banks run on Temenos

Why T24 Islamic

Be ready for the future with T24 Islamic

Thank You