Entire section

4.37. Assets lodged or pledged to secure liabilities

(1) An Islamic Bank must deduct from CET 1 Capital the amount of any assets lodged or pledged by it, if:

  • (a) the assets were lodged or pledged to secure liabilities incurred by the Islamic Bank;

and

  • (b) the assets are not available to meet the liabilities of the Islamic Bank.

(2) The AFSA may determine that, in the circumstances, the amount of assets lodged or pledged need not be deducted from an Islamic Bank’s CET 1 Capital.