Investment Income Sharing Ratio (IISR) as profit distribution mechanism
City Manarah - Islamic banking, The City Bank Limited declares Investment Income Sharing Ratio (IISR) between Bank as "Mudarib" and Customer as "Saheeb Al Maal", which will be applicable on its Bangladesh Taka Manarah Savings Account, Manarah Short Notice Deposit Account, Manarah Term Deposit Account products, Manarah Monthly Benefit Scheme, Manarah Monthly Deposit Scheme and Manarah Hajj Deposit Scheme.
What is IISR:
City Manarah does not offer provisional rate for any types of Mudarabah Accounts aforesaid. In any partnership business partners agree on a profit sharing ratio rather than a provisional or fixed return between them before entering into any agreement. Partners do not expect a fixed return where risk is associated in business. Similarly, when customers open a Mudarabah deposit account with Islamic bank and put some fund, it is considered as his investment into the partnership business with the bank.
Customer and bank must agree on a pre agreed profit sharing ratio. Actual rate will be determined every month-end according to the actual return from investment. Hence, there is no need for provisional rate or fixed rate, as calculation of profit is done monthly. This method of Mudarabah profit distribution is known as Investment Income Sharing Ratio (IISR). City Manarah Islamic banking is using IISR to determine the actual rate of the depositors of different tenure and schemes. The IISRs are used to calculate the profit rate of customers' investment for each month based on actual investment income for that month. For more information, you are requested to please contact our Islamic Banking Branch at 47116695, 47110710, 47116335. We are always committed to uphold Shariah values in banking.