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Islamic Securities Selling & Buying - Negotiated Transaction (ISSBNT)

 

Overview

Operational Framework

Overview

Islamic Securities Selling and Buying - Negotiated Transaction (“ISSBNT”) Model is a Shariah compliant alternative to the conventional Securities Borrowing and Lending - Negotiated Transaction (“SBLNT”) Model. The ISSBNT Model is structured based on two outright bai` (sale) transactions that includes the feature of wa`dan (two unilateral promises/undertakings), khiyar al-shart (conditional option) and the provision of collateral as security for the indebtedness. The details of these features are explained in the ISSBNT Circular NO. 1/2017 and the Frequently-Asked Questions (FAQs).

The ISSBNT framework is introduced by Bursa Malaysia Berhad (“Bursa”) for parties to undertake a transaction that delivers the equivalent outcome of a conventional securities borrowing and lending transaction but is structured based on Shariah principles.

The SAC of the SC resolved on 26 February 2015 that the ISSBNT Model is permissible (Ref: Resolutions of the Shariah Advisory Council of the Securities Commission Malaysia 2016, page 27, which is downloadable at https://www.sc.com.my/wp-content/uploads/eng/html/icm/Resolution_SAC_%202016.pdf.