Al-Arafah Islami Bank Limited
Al-Arafah Islami Bank Limited an interest-free Islamic Shariah Bank, started its activities on 27 September 1995. A Shariah Council of the bank maintains constant vigilance to ensure that the activities of the bank are being conducted according to the precepts of Islam. The bank renders banking services under the Bank Companies Act 1991. The management of the bank is vested in a 13-member board of directors. The managing director of the bank is its chief executive officer. The registered head office of the bank is at Motijheel, Dhaka.
Basic Facts and Economic Indicators (In Million Taka).
| Indicators | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 |
|---|---|---|---|---|---|---|
| Indicators | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 |
| Authorized Capital | 1000 | 1000 | 2500 | 2500 | 2500 | 5000 |
| Paid up Capital | 587 | 678 | 854 | 1153 | 1384 | 1799 |
| Reserved Fund | 488 | 542 | 836 | 884 | 839 | 2299 |
| Deposits | 10108 | 11644 | 16775 | 23009 | 31470 | 38355 |
| a) Call Deposits | 4811 | 2539 | 2979 | 2266 | 3460 | 4589 |
| b) Term Deposits | 5297 | 9105 | 13796 | 20743 | 28010 | 33766 |
| Loans and Advance | 8150 | 11474 | 17423 | 19214 | 29723 | 36134 |
| Investment | - | - | - | 87 | 88 | 1502 |
| Total Asset | 12850 | 15337 | 21368 | 30182 | 39158 | 50577 |
| Total Income | 1121 | 1453 | 2172 | 2955 | 4414 | 5281 |
| Total Expenditure | 809 | 904 | 1203 | 2199 | 2841 | 3532 |
| Foreign Currency Trading | 13068 | 18019 | 28865 | 41599 | 55533 | 60452 |
| a) Export | 3639 | 4931 | 9143 | 12714 | 20176 | 23556 |
| b) Import | 9137 | 12632 | 18821 | 27042 | 32685 | 34074 |
| c) Remittance | 292 | 465 | 901 | 1843 | 2672 | 2832 |
| Total Manpower | 802 | 771 | 912 | 1036 | 1077 | 1296 |
| a) Officers | 723 | 45 | 866 | 957 | 994 | 1197 |
| b) Staff | 79 | 726 | 46 | 79 | 83 | 99 |
| Correspondent Banks | - | 15 | 15 | 17 | 17 | 19 |
| Total Branches (in numbers) | 40 | 41 | 46 | 46 | 50 | 60 |
| a) Domestic | 40 | 41 | 46 | 46 | 50 | 60 |
| b) Overseas | - | - | - | - | - | - |
| Agriculture Credit | ||||||
| a) Loan Disbursed | 8 | 13 | 15 | 19 | 16 | 21 |
| b) realised | 9 | 10 | 14 | 18 | 13 | 17 |
| Industrial Credit | ||||||
| a) Loan Disbursed | 550 | 699 | 2180 | 2171 | 1654 | 2134 |
| b) Realsied | 792 | 474 | 1242 | 1233 | 1032 | 1332 |
| Loan Outstanding by Sector | ||||||
| a) Agriculture and Fisheries | 1 | 3 | 2 | 16 | 353 | 588 |
| b) Industry | 384 | 851 | 785 | 2000 | 5116 | 13884 |
| c) Trade and Commerce | 6251 | 7502 | 1012 | 12320 | 16612 | 13425 |
| d) Poverty Reduction | 4 | 10 | 23 | 54 | 10 | 16 |
Source Government of Bangladesh, Ministry of Finance, Banking and Financial Institution Division, Bank o Arthik Prothisthan Samuher Karjaboli [Annual Report on Banks and Financial Institutions], 2004-05 to 2009-10.
Al-Arafah Islami Bank invests all of its surplus funds on the basis of the trade mode of financing ensuring buying and selling of halal commodities and on a profit and loss sharing basis. A fixed percentage of income derived from investment of mudaraba deposits is distributed to the mudaraba deposit holders. The investment of the bank is supervised strictly so that no investment becomes overdue with consequential loss of investment income. Its modes of investments are: (a) mudaraba finance - purchase and sale of commodities as per requests by clients permissible under shariah regulations; (b) bai-muajjal - cost plus sale of the commodity on deferred payment basis against adequate collateral; (c) bai-salam (advance sale) - buying of goods from producers/suppliers on payment in advance after entering into a firm contract and receipt of their delivery at a future specified date; (d) ijara bil-bai (hire purchase Shirkatul Meelk) - purchase of durable items on equity participation by both the bank and the client and handing them over to the client on installment sale rental basis; (e) mudaraba - entire capital provided by the bank against firm assurance of the entrepreneur that he will manage the business properly and efficiently as manager and the profits derived from the investment will be shared in accordance with the agreement between the bank and the client; and (f) musharaka - capital is provided by the bank and the investment client on the basis of partnership, in which profit is shared in agreed ratio and the loss is shared on equity ratio. The Bank in performing its social and philanthropic activities, has established AIBL English Medium Madrasah and AIBL Library in 1991. [Muhammad Abdul Mazid]
