Meezan Bank, Pakistan’s largest Islamic bank, has partnered with the International Islamic Trade Finance Corporation (ITFC), a member of the multilateral Islamic Development Bank Group (IsDB).
- The agreement, under ITFC’s Letter of Credit confirmation product, facilitates trade flow by eliminating credit risks.
- It will also expand Meezan’s network by leveraging the ITFC network across both member and non-member countries.
- The IsDB, headquartered in Jeddah, Saudi Arabia, has 57 members led by its host country and including Uganda, Libya, Nigeria, Algeria, Sudan, and Egypt.
“The Letter of Credit Confirmation Agreement strengthens our position in the market, enabling us to capitalize on new opportunities and facilitate international Islamic trade,” Syed Amir Ali, Deputy Chief Executive Officer of Meezan Bank said.
Founded in 1973, the IsDB has evolved into several entities. In addition to the ITFC, it also has the Islamic Development Bank (IDB), the Islamic Corporation for Development of the Private Sector (ICD) and the Islamic Development Bank Institute (IsDBI). The group’s largest shareholder is Saudi Arabia with a US $13.2bn capital subscription, a 22.5% share of the group’s total capital, followed by Libya and Indonesia with 9.03% and 7.94% capital share respectively.
The basic condition for joining the group is that the applicant country must be a member of the Organisation of the Islamic Cooperation (OIC). The OIC has 57 members, all members of the United Nations except Palestine. Although it is primarily about the Islamic world, it includes members such as Uganda, Nigeria, Togo, and Ivory Coast that not Muslim-majority.
