Central Bank of Bahrain

The Waqf Fund

The Waqf Fund was established in November 2006 under the auspices of the Central Bank of Bahrain (CBB) in partnership with Islamic Financial Institutions (IFIs) in Bahrain. The member institutions made one-time contributions to the Waqf Fund's corpus which is invested in Islamic money market instruments and the return is used to finance the Fund's initiatives. These initiatives are executed through partner organisations such are BIBF. A brief write-up on these initiatives is as follows:

Current Initiatives

1. Graduate Sponsorship Program

Now in its sixth year, Graduate Sponsorship Program (GSP) serves to provide young Bahraini graduates and junior staff of Waqf Fund member institutions with an orientation in Islamic finance. Islamic banks nominate their staff for the 9-month diploma program with BIBF. They study the following courses: (1) Islamic Commercial Jurisprudence, (2) Islamic Banking Operations, (3) Islamic Treasury and Capital Markets, (4) Islamic Accounting, (5) Islamic Insurance, and (6) Banking, Business and Trust Law. Over 100 people have benefited from this program so far.


2. Shari'a Reviewer Development Program

The program aims to provide basic orientation to Islamic and conventional finance/banking to Internal Shari'a Reviewers of Islamic Financial Institutions (IFIs) and plug any knowledge gaps. These are designed as short courses of 10-30 hour duration. The topics covered include: (1) Understanding Financial Statements for IFIs, (2) Business, Banking and Trust Law, (3) Islamic Treasury and Capital Markets, (4) Risk Management for IFIs, (5) Shari’a Auditing & Corporate Governance for IFIs, and (6) Introduction to AAOIFI and IFSB Standards. An advanced version of this program is currently being designed which includes additional topics. 

3. Advance Diploma in Islamic Commercial Jurisprudence

This program provides more depth in specific topics to the Internal Shari’a Reviewers of IFIs. Spread over a one year period and conducted in Arabic the Diploma consists of 8 modules: (1) The Theory of Contracts and its legal maxims, (2) Objectives of Shari’a and Jurisprudential Law (Usul Al Fiqh), (3) Principles of Fatwa and Applied Jurisprudence, (4) Islamic Financial Transactions, (5) Fiqh of Zakat and Waqf, (6) Fiqh of Takaful, (7) Shari’a Auditing and Compliance for Islamic Financial Institutions, and (8) the Research component that concludes the program. The research component has been added for greater depth and quality and to ensure that the program’s learning outcomes are thoroughly achieved by all the participants. Approx. 40 people have benefited from this program.

4. Roundtable Discussions

The Fund has held a series of Roundtable Discussions on developmental issues by bringing together leading figures in Islamic finance - including industry professionals, regulator and Shari’a scholars - to focus on key issues and recommending a way forward. So far the Fund has held seven such Roundtables. The recommendations from these Roundtables have been compiled and forwarded to the Central Bank of Bahrain for its consideration and further action. Some of the industry developments were a direct result of these Roundtables while others are under consideration of the CBB. Some of the topics discussed during Roundtables are: "Enhancement of Shari'a Compliance Framework - Opportunities and Challenges", "Ethical Checks and Balances in an Islamic Bank", "Shari'a and Corporate Governance Issues in SPV Governance", "Roles & Responsibilities of Shari'a Supervisory Boards and Internal Shari’a Reviewers of Islamic Financial Institutions".

5. Development of a course on Business Ethics for Islamic Bankers

The Fund sponsored the development of a general course through the BIBF on main Shari'a principles on ethics for junior bankers. The course materials were developed and the course is now being offered by BIBF as a mandatory course as required by the Central Bank of Bahrain. The course aims to provide a basic understanding of Shari’a-based ethical guidelines for practitioners, improving their confidence and promoting good governance at Islamic banks. The objective is to ingrain in the sales people a Shari'a compliant sales approach, other front office functions to deal with clients based on Shari’a principles, the middle office staff to review transactions bearing in mind the relevant Shari’a principles, and the back office people to record, settle and maintain documentation bearing and observing Shari’a principles, thereby establishing a Shari’a oriented culture in the financial institution.


6. Upgrade of the Advance Diploma in Islamic Finance curriculum

The Fund financed the development of the Advance Diploma in Islamic Finance (ADIF) curriculum of BIBF. The Fund engaged a well-recognized consulting firm to assist BIBF in developing reference manuals on six subject modules to be used in the diploma program. The new version of the diploma was re-launched in 2008.


7. Assisted and sponsored University of Bahrain in developing and launching a 4-year Bachelor of Arts in Shari’a for Banking & Finance program

The Waqf Fund joined hands with the University of Bahrain to support its 4-year bachelor program in Islamic finance. The Waqf Fund has provided financial assistance to the program as well as helped in curriculum development by providing the industry’s perspective. Now in its third year, this is a unique fusion program between Shari’a and Business. The graduates of this bilingual program will be well equipped to work for any Islamic financial institution in Bahrain and globally. They will possess a rare combination of Shari’a, financial, accounting, economics and business knowledge. They will be integrated with the industry through seminars and internships.


8. Shari'a scholar sessions

In 2013 the Waqf Fund started a regular session with leading Shari’a scholars in the Islamic finance industry whereby they address the Internal Shari'a Reviewers of IFIs in Bahrain on specific topics, followed by an extensive Q&A session. The purpose of this program is to provide an opportunity to up and coming Shari'a scholars to interact with and learn from leading Shari'a scholars through dialogue and discussion. Six sessions have so far been held with scholars of international standing including Shaikh Esam Ishaq, Shaikh Nizam Yaquby, Shaikh Osama Bahar, Dr. Abdulsattar Al-Kattan, Dr. Hussain Hamid Hassan and Dr. Mohamed Burhan Arbouna. The topics covered are "Shari’a issues in SPVs", "Credit Card Structures and their Shari'a Issues", "Perpetual Sukuk – The Shari'a Perspective", "Investment Wakala", "Sukuk role and challenges in project finance and asset-backed vs. asset-based debate", "Salam as a liquidity management tool for Islamic banks".


9. Corporate Governance workshops for CEOs and Directors of IFIs

Given the increasing importance of corporate governance worldwide and the local Corporate Governance code introduced by the CBB, there was a pressing need to improve the CG standards of IFIs. The Waqf Fund offered three workshops to its member institutions in 2011, 2012 and 2014 who participated enthusiastically including CEOs, Board Secretaries, Directors and Chairpersons. An expert in corporate governance who is also a former professor at Harvard Business School was engaged to deliver the workshops using case study method.


10. Sponsoring AAOIFI in revamping its CIPA qualification

Based on the industry feedback the Waqf Fund engaged with AAOIFI to sponsor further development of its flagship global Islamic accounting qualification - Certified Islamic Professional Accountant (CIPA) – to enhance its quality on par with equivalent and similar global qualifications. The objective is to develop the right human resources who combine conventional as well as AAOIFI accounting knowledge, understanding of the underlying Shari'a principles and standards and exposure of practical issues facing Islamic financial institutions. The Waqf Fund has engaged a well-recognized consultant to substantially upgrade the curriculum in line with industry requirements as well as change the conduct of examination. This is the first major revision of the CIPA curriculum since its launch in September 2006. The revised CIPA curriculum will also include contemporary accounting and auditing issues that have come up in the last few years especially after the global financial crisis.


11. Leadership Grooming Program

The Waqf Fund has engaged a leading university in North America to launch a custom made leadership grooming program for the middle management of IFIs. The purpose of this program is to prepare the next generation of C-suite executives who can steer the Islamic finance industry in the right direction. This initiative seeks to address a key demand of the industry that the number of competent and high integrity Bahraini nationals in positions of authority should increase in the Islamic financial sector. The program targets Bahrainis in mid management aged up to 45 years at the time of nomination and having at least 10 years professional experience. The program runs for 17 working days in Hong Kong and Toronto, Canada. Primarily using the case study method the participants will be provided advanced learning in leadership skills, strategic thinking and ethics, while also exposing them to the Asian business model and the financial sector of Canada. This experience and interaction will hopefully prepare them to become better leaders and decision makers.

12. Leadership Grooming Program

Working group on external independent Shari’a audit: After the 7th Roundtable Discussion the Waqf Fund formed a committee to develop a concept paper on external independent Shari'a audit. The concept paper will be presented to the CBB which may consider making it mandatory for Islamic banks and windows in Bahrain to have independent Shari’a audit every year. This is an evolving best practice globally and its purpose is to enhance the Shari’a compliance culture in Islamic banks. .

13. Leadership Grooming Program

Working group on International Association of Shari'a Auditors and Reviewers: The Waqf Fund has formed a committee to deliberate on establishing an International Association of Shari’a Auditors and Reviewers (IASAR). The need for such a platform is being felt in the industry and the initiative taken by the Waqf Fund is in response to this need. The Association will have a global mandate and it will provide support to its members - Shari'a Auditors and Shari’a Reviewers - to fulfill their professional responsibilities with excellence.





Contact The Waqf Fund:

Mr. Khalid Hamad A. Rahman

Chairman, The Waqf Fund

Tel: +973 1754 7400

For any enquiry, please click here

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