Course Overview

Islamic banking operates within a framework rooted in ethical finance, Sharia’a principles, and robust governance structures. Without effective regulatory oversight and governance systems, financial institutions face significant risks, including compliance failures and reputational damage.

The Islamic Banking – Functions and Governance course by Transformentors Academy provides participants with comprehensive knowledge of Islamic finance fundamentals, banking operations, governance frameworks, and regulatory environments. Delivered over five intensive days, the programme covers key areas such as Islamic financial contracts, institutional structures, supervisory mechanisms, and emerging industry trends.

With a strong focus on practical application, this course enables participants to understand real-world Islamic banking practices and governance challenges. By the end of the programme, participants will be equipped to manage Sharia’a-compliant operations, strengthen governance frameworks, and apply ethical financial principles with confidence.

Agenda

Day — 1 Foundations of Islamic Banking and Finance

• Understanding the origins and philosophical foundations of Islamic banking
• Exploring the key objectives and ethical principles that underpin Islamic finance
• Examining Sharia’a rules and prohibitions governing financial transactions
• Identifying the key differences between Islamic and conventional banking systems
• Analysing the socio-economic role of Islamic banks in promoting equitable growth
• Case Study: Review the establishment and development of the first Islamic bank

Day — 2 Islamic Banking Functions and Products

• Understanding the core functions of Islamic banks, including:
  • Deposit mobilisation
  • Financing activities
  • Investment management
  • Trade facilitation
• Exploring key Islamic financial contracts and instruments, such as:
  • Murabaha (cost-plus sale)
  • Ijara (leasing)
  • Mudaraba (profit-sharing)
  • Musharaka (partnership)
  • Istisna (manufacturing contract)
• Examining liquidity management and risk management practices in Islamic banking
• Understanding the role of Islamic finance in corporate banking, retail banking, and capital markets
• Analysing the importance of social responsibility and ethical investment in Islamic financial practices
• Exercise: Classify financial transactions as Sharia’a-compliant or non-compliant

Day — 3 Regulatory and Institutional Frameworks of Islamic Banking

• Understanding the theoretical foundations behind the institutional development of Islamic finance
• Exploring the role of key regulatory bodies and international organisations, including:
  • AAOIFI (Accounting and Auditing Organisation for Islamic Financial Institutions)
  • IFSB (Islamic Financial Services Board)
  • Islamic Development Bank
• Examining the relationship between Sharia’a compliance and regulatory frameworks
• Analysing challenges in harmonising Sharia’a interpretations across different jurisdictions
• Understanding risk management frameworks and prudential requirements in Islamic financial institutions

Day — 4 Governance and Compliance Frameworks

• Understanding the concept of governance within the context of Islamic banking
• Examining the structure, roles, and responsibilities of Shariah Supervisory Boards (SSBs)
• Reviewing governance standards issued by AAOIFI and IFSB
• Understanding Shariah audit, review, and certification processes
• Identifying common governance challenges faced by Islamic financial institutions
• Case Study: Analyse a national regulatory framework for Islamic banking

Day — 5 Contemporary Issues and Future Trends in Islamic Banking Governance

• Exploring emerging trends shaping the Islamic banking sector and their strategic implications
• Understanding reputation management strategies in Islamic financial institutions
• Analysing lessons learned from Shariah non-compliance cases and governance failures
• Examining how Islamic banks integrate ESG principles and social impact objectives
• Assessing the impact of globalisation on Islamic banking and its future outlook
• Recap and Course Evaluation

Learning Outcomes

By attending the Islamic Banking – Functions and Governance course, participants will be able to:

• Understand the origins, principles, and ethical foundations of Islamic banking and distinguish it from conventional banking systems
• Interpret and apply key Sharia’a rules and prohibitions to assess the compliance of financial transactions and instruments
• Describe the core functions and operations of Islamic banks, including deposit mobilisation, financing, investment, and trade facilitation
• Analyse major Islamic financial contracts and instruments, such as Murabaha, Ijara, Mudaraba, Musharaka, and Istisna
• Evaluate the institutional and regulatory environment of Islamic banking, including the roles of central banks, regulators, and standard-setting bodies
• Assess governance and compliance frameworks within Islamic financial institutions, including the role of Shariah Supervisory Boards and internal audit functions
• Explore emerging trends and future developments in Islamic banking governance, including ESG integration, fintech innovation, and globalisation

Who Should Attend

The Islamic Banking – Functions and Governance programme is designed for professionals working within Islamic finance and governance functions, including:

• Islamic banking managers and officers
• Sharia’a compliance specialists
• Risk and governance professionals
• Financial analysts and accountants
• Legal advisors specialising in Islamic finance
• Members of Sharia’a Supervisory Boards