Shariah-compliant dollar accounts: Meezan Bank, Mashreq Bank sign accord

KARACHI: Meezan Bank, the first and largest Islamic commercial bank, entered into an agreement with Mashreq Bank PSC, United Arab Emirates, under which Meezan Bank will earn Shariah-compliant profits on its dollar clearing accounts balance held with the Mashreq Bank. The innovative arrangement utilises a Shariah-compliant principle of ‘Wakala’. Aimed at facilitating the growing market of Islamic financial institutions, this innovative product was initially developed to cater to Meezan Bank’s requirement of earning Shariah-compliant profits on its dollar clearing account. This product was developed and launched by Mashreq Bank and was later commercialised and made available to clients globally across Mashreq’s network. The product is approved by the Shariah divisions of both banks. Speaking at the occasion, Ariful Islam, Chief Operating Officer of Meezan Bank, commented: “The US dollar Islamic arrangement with Mashreq Bank will prove to be a significant positive development.”

Published in The Express Tribune, January 16^th, 2013.

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