Tawarruq Bank Islam

8/11/2019 Tawarruq Bank Islam

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Term Deposit-i (Tawarruq)

Introduction

Watch your money consistently grow through our Term Deposit-i (Tawarruq) [TDT-i]. A capital guaranteed deposit

account that allows you the flexibility of managing funds according to your short or long-term needs.

TDT-i offers an attractive upfront profit rate and on maturity you will be able to earn the returns based on the

upfront profit rate contracted at point of sale. Indeed a peace of mind knowing that your funds are reaping theattractive returns and capital guaranteed.

Come over to any Bank Islam branches to open a TDT-i account starting 30 April 2014.

Product Features

Age 18 years old & above

Who Can Apply /

Eligibility

Individuals

Resident

Non Resident

Non Individuals

Trustees

School/University

Club/Association

Society

Mosque/Religious Bodies

Sole Proprietorship

Partnership

Company

Cooperative

Government (Federal/Local/State)

Public Authorities

Others

Initial Deposit Minimum Deposit Placement

RM1,000 for 1 month

RM500 for 2 months & above

* No maximum deposit amount

Currency Ringgit Malaysia (RM)

Tenure 1 60 months

Multiple of 1 month (starting from 1 12 months)

Multiple of 3 months (starting from 15 60 months)

Principal and Profit

Guaranteed

Yes

PIDM Insurable Yes (Up to RM250,000) *


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* Terms and conditi ons apply

Premature Withdrawal Allowed but profit is payable on the following conditions:

Deposit TenureRebate upon Pre-Mature

Withdrawal*

3 months and below No profit

4 months and above (uncompleted tenureof 3 months) No profit

4 months and above (completed tenure of

3 months)

Profit is payable at 50% of the original

agreed profit

* The rebate may vary from time to time and subject to mutual agreement.

Note:

For early withdrawal of the deposit, the Bank may also charge back to the

Customer for any holding, handling and brokerage fees/charges actually charged by

any third party commodity trader for sale and purchase of the commodity and to be

deducted from the Sale Price (Murabahah).

Profit Payment

FrequencyUpon maturity (tenure up to 1 year)

Half-yearly profit payment (tenure above 1 year)

Auto Renewal Allowed for the same deposit amount and for the same tenure

Allowed for the deposit amount + profit and for the same tenure

Note:

For auto-renewal of the deposit, the profit rate is to be based on the Banks

prevailing profit rate at the point of renewal.

Brokerage Fee Absorbed by the Bank

Underlying Asset for

Commodity Murabahah

Transaction

Metal (excluding gold and silver) or Crude Palm Oil (CPO) or other commodity as

approved by Shariah.

Mode of Operation Certificate

Partial Withdrawal Not Allowed

Frequently Asked Questions (FAQ)

1. What is Term Deposit-i (Tawarruq)/Term Deposit-i (Tawarruq) Special?

Term Deposit-i (Tawarruq)/Term Deposit-i (Tawarruq) - Special is a term deposit product with a fixed profit

rate. The profit is derived from the commodity purchase and sale transactions based on the profit rate

determined upfront.

2. What is the Shariah concept applicable?

The applicable Shariah concept is Tawarruq where the commodity is used as an underlying asset for the

purchase and sale transactions between commodity trader(s), the Customer and the Bank.

3. Who can open this account?

Individuals (18 years and above) and non-individuals (Business, Corporate & others)


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4. Is joint account allowed?

Yes, but only for individuals

5. What is the minimum deposit amount required and what is the maximum deposit amount

allowed?

Minimum Deposit PlacementRM1,000 for 1 month and RM500 for 2 months and above

For Term Deposit-i (Tawarruq) Special, it is negotiable

Maximum Deposit Placement There is no maximum deposit amount

6. What are the tenures available?

1 month to 60 months

For Term Deposit-i (Tawarruq) Special, it is negotiable

7. Will Customers get a certificate?Yes, Customers will get Term Deposit-i (Tawarruq) certificate upon account opening/deposit placement.

8. Can Customers make a partial withdrawal?

No, Customers cannot make a partial withdrawal. Partial withdrawal is not allowed.

9. Is pre-mature withdrawal allowed?

Yes, pre-mature withdrawal is allowed, but profit is paid as follows:

Deposit Tenure Rebate upon Pre-Mature Withdrawal*

3 months and below No profit

4 months and above (uncompleted tenure of 3

months)No profit

4 months and above (completed tenure of 3

months)

Profit is payable at 50% of the original agreed

profit

* The rebate may vary from time to time and subject to mutual agreement.

Note:

For early withdrawal of the deposit, the Bank may also charge back to the Customer for any holding,

handling and brokerage fees/charges actually charged by any third party commodity trader for sale andpurchase of the commodity and to be deducted from the Sale Price (Murabahah).

10. Is renewal of the deposit allowed?

Yes, renewal of the deposit is allowed. Customers may perform renewal of deposit amount only or deposit

amount with profit amount.

11. What is required for renewal of the deposit?

Each renewal of the deposit will require a new commodity purchase and sale transaction (inclusive of auto

renewal).

Terms and Conditions


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1. Application of Account

The Customer applying for the opening of Term Deposit-i (Tawarruq) account/Term Deposit-i (Tawarruq)

account - Special (the Account) with Bank Islam Malaysia Berhad (the Bank) shall be bound by the

terms and conditions governing the operations of the Account in force from time to time.

The Bank shall not be bound to perform any obligation expressed to be assumed by it hereunder until the

Bank shall have received in form and substance satisfactory to the Bank each of the following documents

(where applicable):

a certified true copy of the constitutive corporate documents of the Company, including its

Memorandum and Articles of Association and its Certificate of Incorporation;

original signatures book or other appropriate document evidencing authorisation of the signatories to

this Application Form to sign the Application Form and all other documents required in relation to it;

a certified copy of the latest audited financial statements of the Company; and

any other documents as the Bank may reasonably require in writing addressed to the Customer in

connection with the Application Form.

The Bank may waive or defer the delivery of any of the documents referred to in the preceding Clause but

the Customer shall be bound by the terms of the Application Form notwithstanding such waiver or

deferment.

2. Deposit Transaction

By opening the Account and depositing money into the Account, the Bank promises the Customer to

purchase Commodity from the Customer under Murabahah contract on deferred payment basis.

Commodity means any commodity (e.g. Crude Palm Oil) traded at Bursa Suq Al-Sila (BSAS) or any

metal traded at the London Metal Exchange (LME) excluding gold and silver, or any other commodity/

asset in each case provided that such commodity/ asset is acceptable to the Bank and Shariah compliant.

Based on Shariah contract of Wakalah, the Customer appoints the Bank to act as the Customers agent for

the purchase and sale of the Commodity (Commodity Purchasing and Selling Agent) in accordance with

the terms and conditions herein contained. The Bank will only act as the Customers agent and will not

assume, or be deemed to have assumed, any additional obligations to, or to have any special relationship

with the Customer other than those for which specific provision is made in the terms and conditions herein.

2.1 As the Commodity Purchasing and Selling Agent, the Bank shall, during the tenure of the deposit

and any subsequent deposit placement or any renewal thereof, have the following power and

authority:

a) to perform and execute all acts with respect to the purchase of the Commodity at Deposit

Amount on cash basis (Commodity Purchase Transaction(s)) through purchase agreements,

certificates and other instruments as the Customer could do himself/itself and to negotiate with

commodity suppliers or traders (Commodity Trader(s)) on behalf of the Customer in relation

thereto; and

b) to sell the Commodity on deferred payment to the Bank at Deposit Amount plus profit (Sale

Price (Murabahah)) on behalf of the Customer and to perform and execute all acts in relation

thereto (Commodity Murabahah Transaction(s)).

PROVIDED ALWAYS that the above said mandate given to the Bank as Commodity Purchasing and

Selling Agent shall be subject to the Banks prevailing profit rate under the Commodity MurabahahTransaction(s). Confirmation of Transaction(s) (COT) relating to the Customers purchase and sale of the

Commodity will be issued by the Bank to the Customer (upon request) confirming the purchase of the

Commodity from the Commodity Trader(s) and the sale of the commodity to the Bank.

Deposit Amount means the amount deposited into the Account by the Customer whereby the Bank will


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subsequently purchase the Commodity from Commodity Trader(s). For the avoidance of doubt in the case

of auto deposit renewal with profit amount, Deposit Amount refers to the original deposit amount deposited

into the Account plus the profit amount earned in previous deposit placement (if any).

2.2 The Bank will, in performing its obligations and activities in the Commodity Purchase Transaction(s)

and/or Commodity Murabahah Transaction(s) look after the best interest of the Customer and act in

good faith.

2.3 The Customer shall irrevocably and unconditionally indemnify the Bank against all losses, claims,actions, proceedings, damages, costs and expenses whatsoever brought or claimed by any party

and/or incurred or sustained by the Bank as a result of the Commodity Purchase Transaction(s)

and/or Commodity Murabahah Transaction(s) as agent of the Customer or any breach by the

Customer of his/its obligations herein. The indemnity given hereunder shall survive termination of the

agency relationship and any sums payable in relation thereto shall not be subject to any deduction

whether by way of set off counter claim or otherwise.

3. Payment of the Sale Price (Murabahah)

Formula for computation of the profit and Sale Price (Murabahah) are as follows:

a. Calculation of the profit:

Profit = P x R x T/365*

Where:

P = Deposit Amount

R = Profit Rate (%) given upon the placement

T = Tenure (number of days, from placement date to maturity date)

*Denominator = To follow the markets day-count convention

For auto-renewal of the deposit, the profit rate is to be based on the Banks prevailing profit rate at the

point of renewal.

b. Calculation of the Sale Price (Murabahah):

Sale Price (Murabahah) = Deposit Amount + Profit (total profit for the whole placement tenure)

Illustration:

Deposit Amount RM100,000.00

Profit Rate 3.00%

Tenure 3 months

No.of Days 91

Placement date 01/04/2014

Maturity date 30/06/2014

Profit RM747.95

Sale Price (Murabahah) RM100,747.95

Realisation of the Sale Price (Murabahah) is subject to the completion of the Commodity Murabahah

Transaction(s) and to the provision under Clause 4.2 herein.

3.1 Both the Bank and the Customer acknowledge that under the Commodity Murabahah Transaction(s),the Banks payment obligation is to pay the Customer the Sale Price (Murabahah).

3.2 The Bank will at the instruct ion of the Customer pay the profit from the Commodity Murabahah


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Transaction(s) to the Customer either on monthly basis or upon maturity of the tenure as the case

may be. If the profit is to be paid on monthly basis, the amount to be received by the Customer is

equivalent to the profit amount to be distributed for the month whereas if the profit to be paid on

maturity, the Bank shall pay the Customer the whole profit amount on lump sum basis or six (6)

monthly as the case may be.

4. Withdrawal Transaction

Any withdrawal shall be made by written request bearing the authorised signature(s) registered with theBank. The Bank shall not be responsible for any unauthorised entries in the Account. The Customer shall

therefore carefully examine the entries in the Account and notify the Bank of any unauthorised entries.

4.1 Partial withdrawal is not allowed.

4.2 In the event of occurrence of any of the termination events as specified under Clause 5.1 or the

Customer makes an early demand for the payment of Sale Price (Murabahah) before the maturity

date of the deposit, the Customer undertakes to grant Ibra (rebate) on a part or all of the profit

comprised in the agreed Sale Price (Murabahah) to the Bank (after deducting any payment made to

the Customer, as the case may be), as per Schedule attached.

For early withdrawal of the deposit, the Bank may also charge back to the Customer for any holding,

handling and brokerage fees/charges actually charged by any third party Commodity Trader for sale

and purchase of the Commodity and to be deducted from the Sale Price (Murabahah).

4.3 For interim profit payment (upon maturity/pre-mature withdrawal), if the total amount of interim profit

paid is greater than the total amount of actual profit to be paid, the profit refund will be deducted from

the Deposit Amount.

4.4 This deposit is not allowed to be withdrawn unless it is returned with the Customers signature and it

shall not be withdrawn in different amount of cheque and draft.

4.5 Authorised letter is required in the absence of the Customer to receive the payment or request for

third party payment.

4.6 The Customer hereby agrees that the Banks determination of any amount payable to the Customer

under the Account save for manifest error shall be final, conclusive and binding against the Customer.

5. Withdrawal Transaction

The Bank reserves the right to close the Customers Account upon the Customers request, by operation of

law or at the discretion of the Bank.

5.1 The Account shall be closed/ terminated upon occurrence of any of the following events:

i) bankruptcy or liquidation of the Customer; or

ii) cheque deposit is returned or dishonoured; or

iii) withdrawal by the Customer of all or part of the deposit amount placed; or

iv) the Customer commits breach of any of the terms and conditions herein; or

v) the Customer does not accept any alteration and amendment to the terms and conditions, and

the provision under Clause 4.2 shall apply; or

vi) instruction of any law enforcement agencies.

6. Lost and Stolen


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6.1 The Customer is to keep the certificate safely and is required to immediately report, in writing, its

loss or theft to the Bank. The replacement of lost certificate may be issued against a duly signed and

stamped Letter of Indemnity, subject to payment of a stamp duty of RM10 or such other amount as

the Bank may determine from time to time.

6.2 Replacement of lost certificate shall only be done at the branch where the Account was opened.

6.3 Replacement of lost certificate will be as per the terms and conditions governing the operations of the

certificate.

7. Auto Renewal

If the Customer does not present/ renew the certificate after maturity date, the Bank shall regard that the

Customer has agreed to renew the certificate automatically, and the provision under Clause 3 (a) & (b) shall

apply for the computation of Sale Price (Murabahah). However, this auto renewal will be applicable for a

total tenure of not more than 7 years, otherwise, it will be subject to Clause 11 hereunder. Auto renewal is

not applicable for Term Deposit-i (Tawarruq) Special

8. Pledge as Security

The Account may be pledged as security for the performance or discharge of any obligation or any liabilityof the Customer to the Bank hereunder, where applicable. Otherwise, the Account shall not be pledged or

charged for any other reasons whatsoever.

9. Changes to the Terms and Conditions

The Bank reserves the right to add, delete, amend or alter any or all of these terms and conditions at any

time and subject to the extent permitted by Shariah principles and law. Such changes shall become

effective after 21 days such notices being displayed in the Banks premises or by any other mode of

communication which the Bank may deem fit.

10. Change of Address

If there is any change in the Customers postal address, the Customer shall notify the Bank immediately.This is important to ensure that all communication reach the Customer promptly.

11. Unclaimed Monies Reminder

Under the Unclaimed Monies Act 1965, if the Account is not active or no transactions performed for more

than 7 years, the Account will be transferred to the Unclaimed Monies Registrar. The Bank may issue

reminder to the Customer to close/ activate the Account.

12. Governing Law and Jurisdiction

This agreement shall be governed by and construed, interpreted and applied in accordance with the laws of

Malaysia provided always that in event there is a conflict between the laws the Shariah principle shall

prevail.

The parties shall comply with the provisions of any written law with which they may be required to comply

respectively including Personal Data Protection Act 2010 and any other Act, Enactment or Ordinance or

any by-law, rules, regulations or other subsidiary legislation under such Act, Enactment or Ordinance or

any direction, Order, requirement or instruction given by any authority competent to do so under any written

law.

13. Successors Bound

These terms and conditions shall be binding upon the successors-in-title, of the parties and the permitted

assign of the Customer.

14. Declaration

The Customer hereby declares that all statements made and other documents submitted in connection with

this application are complete and true to the best of its knowledge and belief.


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15. Miscellaneous

Any conditions, document and endorsement to the Account shall be read together, and any word or

expression to which specific meaning has been attached in any part of this document shall bear such

meaning wherever it may appear. Should there be any dispute over the terms and conditions between the

English and the Bahasa Melayu version, the English version shall prevail.

Tawarruq Bank Islam

Documents

Transcript of Tawarruq Bank Islam