July 20, 2005

ISLAMIC BANKING SERVICE (IBS) PAYS OUT 7.49%

Investors in Clico Investment Bank’s (CIB) Islamic Banking Service have benefited from a dividend payout representing a 7.49 per cent annualized return.

According to Islamic Law, Muslims should not enter into any form of interest-based transactions. Additionally, investment activities cannot involve companies or industries that earn revenue, by means that do not conform with Islamic stipulations outlined in the Holy Qur’an.

In this regard, in the year 2000, CIB became the first licensed financial institution to introduce Islamic Banking to Trinidad and Tobago. Since then, the IBS has grown tremendously, with its investor base experiencing a 20 per cent increase over the last year. Annualized dividends this year, of 7.49 per cent, have outstripped and surpassed the returns of other similar accounts, including money market funds and certificates of deposit offered by other financial institutions.

The Islamic Banking Service offered by CIB operates as an independent unit within the Bank. Its funds are held in separate accounts and the Fund Manager collaborates with a Shariah Supervisory Board, thereby ensuring that all investments conform to Islamic Shariah. Profits of the Fund are derived from the following investment activities:

• Purchase/Resale of tangible items
• Joint Venture projects
• Real Estate transactions

Dividends are paid semi-annually and all income is paid out to investors of the Fund. Although, this service has been especially tailor-made for Muslims, anyone can invest by making the minimum contribution.

The IBS has introduced several new funds this year including:

• US Dollar Fund
• Hajj Savings Plan
• Education Plan