Islamic Export Refinance Scheme

Report
Islamic Export Refinance Scheme
Structure of Presentation


Objectives of the scheme
SBP-IBI arrangement




IBI - customer arrangement



Limit
Musharaka Pool
Profit & Loss Sharing
Part I
Part II
Penalties
Objectives of the Scheme

To Provide Liquidity to Islamic Banks for
export financing

To Promote Exports

To change Composition of Exports
SBP – IB/IBB Arrangment

Distinctive Features




Musharaka between SBP & Bank
Profit and Loss sharing of Musharaka Pool
Payment of Provisional Profit
Takaful Fund for SBP
Limits under IERS

Assigned Annually – Reviewed Quarterly



SBP’s internal Criteria
1.5 times equity for IBs
20% of EFS for IBBs
SBP’s considerations while assigning limits
Musharaka between SBP & Bank

Minimum 10 blue chip companies

Blue Chip companies criteria

Credit Rating of B+ or higher or

Good Track record on the stock exchange (if listed) or

ROE of previous 3 years > EFS rates and

NO adverse CIB report

SBP contribution to Pool up to investment provided

Bank contribution equal to or more than SBP’s

Pool exposure to any one sector < 50%
Profit & Loss Sharing

Gross profit



PLS as per weightages assigned


Less provisions for year
Plus recoveries against earlier provisions
EFS rates used as benchmarks
What is Provisional Profit?
Takaful Reserve

Purpose


How it is created


SBP’s share of losses shall first be met from the
Takaful fund.
Differential amount of SBP’s share in Profits (Actual
Profit as per Audit less Provisional Payments)
Takaful Reserve is for SBP only – Not Banks
IB/IBB & Customer Arrangement


Similar to EFS
IERS is available as:
- Part-I (Transaction Based) DE/IDE both for preshipment
- Part-II (Limit based on previous Performance) DE
only
IERS for Exporters
Part I
Part II
Indirect Exporters as
well as Direct Exporters
Direct Exporters only
Tenor
IDE-120 days;
DE-180 days
180 days
Document for
availing
IDE: Form 4 ILC/SPO/
Financing Agreement
DE: Form 3/ FEO/ELC/
Financing Agreement
Limit assigned based
on EE -1
Form 3
DP Note
Documents to
submit
IDE: Invoice, Delivery
EF-1
challan /GNR)
Truck/Railway Receipt,
DE: Original Duplicate of
Form E, BL/AL, Invoice,
EPRC
Substitution
Allowed
Not Required
Penalties / Fines
For defaults/ breaches in agreement fines are
charged from the Exporter & banks
The Scheme is available on SBP website
http://www.sbp.org.pk/incentives/
iers.htm
Thank you

similar documents