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The International Islamic Financial Market (IIFM) and the International Capital Market Association (ICMA) today announced the signing of a Memorandum of Understanding (MOU) and the formal commencement of their joint initiative to develop a global standardised documentation framework for a Shari’ah-compliant repurchase agreement (Repo). The project is officially titled the IIFM/ICMA Islamic Repo (I’aadat Al Shira’a) Master Agreement.
This landmark initiative addresses long-standing liquidity management challenges in Islamic finance by replacing fragmented practices with a unified, Shari’ah-compliant, and robust operational standard. The collaboration leverages ICMA’s extensive experience with the Global Master Repurchase Agreement (GMRA) and IIFM’s specialised expertise in Shari’ah-compliant standard-setting. Yusuf Battiwala, Partner at Norton Rose Fulbright has been appointed as Legal Counsel for the project.
The standardisation project is designed to enhance market liquidity by providing Islamic financial institutions worldwide with reliable tools for short-term funding, while simultaneously reducing operational costs and Shari’ah complexities.
Dr. Ahmed Rufai, Acting CEO of IIFM:
"We are delighted to partner with ICMA to bring greater standardisation, harmonisation and transparency to the Islamic repo market. By combining ICMA's global expertise in Repo with IIFM’s Shari’ah leadership, we are creating a framework that facilitates efficient liquidity management and strengthens the integration of Islamic finance within global capital markets. This project is a cornerstone of our strategic vision, providing the legal certainty and infrastructure necessary for a more transparent, efficient, and interconnected Islamic financial future."
Mr. Bryan Pascoe, Chief Executive of ICMA added:
“Repo is a cornerstone of the global financial market and an essential tool for firms’ liquidity and risk management. By partnering with IIFM to develop a globally standardised, Shari’ah-compliant master agreement, we aim to help with extending the core benefits of repo to the Islamic Finance market, bringing greater clarity, legal certainty and operational efficiency to Islamic repo activity across key markets. This will support Islamic banks and other market participants in managing short-term funding more effectively, and it will strengthen the resilience and connectivity of local capital markets as they continue to deepen and internationalise.”
Following the completion of the drafting phase, the standards will be supported by an explanatory memorandum to assist market participants in seamless implementation.
We invite ICMA members to contact us if they have any questions or would like to get involved.
Likewise, we invite IIFM members to contact us with any inquiries or expressions of interest regarding this initiative.
About the International Islamic Financial Market (IIFM)
IIFM was established under Royal Decree No. (23) Year 2002 of the Kingdom of Bahrain as a neutral and non-profit global standard-setting body of the Islamic Financial Services Industry (IFSI) focusing on standardization of Shari'ah-compliant financial contracts and product templates. Established by the efforts of: Central Bank of Bahrain (CBB), Islamic Development Bank (IsDB), Bank Indonesia (BI), Bank Negara Malaysia (BNM) (represented by Labuan Financial Services Authority), Central Bank of Sudan (CBOS) & Brunei Darussalam Central Bank (BDCB).
www.iifm.net
About the International Capital Market Association (ICMA)
ICMA promotes well-functioning cross-border capital markets, which are essential to fund sustainable economic growth. It is a not-for-profit membership association with offices in Zurich, London, Paris, Brussels, and Hong Kong, serving over 640 members in 71 jurisdictions globally. Its members include private and public sector issuers, banks and securities dealers, asset and fund managers, insurance companies, law firms, capital market infrastructure providers and central banks. ICMA provides industry-driven standards and recommendations, prioritising three core fixed income market areas: primary, secondary and repo and collateral, with cross-cutting themes of sustainable finance and FinTech and digitalisation. ICMA works with regulatory and governmental authorities, helping to ensure that financial regulation supports stable and efficient capital markets.
www.icmagroup.org
Media Contacts:
IIFM
Contact details for further information
Tareq Fouad
tareq.fouad@iifm.net
ICMA
Contact details for further information
Oliver Tinkler
oliver.tinkler@icmagroup.org
