KARACHI, May 14: Meezan Bank — the first Islamic commercial bank — has started raising short-term deposits through its Riba- free certificates after becoming operational from this month.

Shariah adviser of the bank, Dr. Imran Usmani told Dawn that the certificates that were introduced by Al-Meezan Investment Bank for attracting long-term investment had been redesigned.

“People can now buy these certificates in shorter tenors,” he said when reached by Dawn over telephone. Dr. Usmani said the certificate holders could even enjoy the facility of saving accounts, but made it clear that whereas the contract drawn for this purpose is Shariah compliant and the certificate buyers are told in advance of the ratio of profit. “Basically it is a Musharika agreement between the bank and the depositors,” he said.

Dr. Usmani said on the assets side the bank continued to lend money under Morahaba and Ijara — two basic Islamic modes of financing, adding that the bank also had case-specific products for the borrowers.

Meanwhile the Karachi Stock Exchange issued a notification on Tuesday informing all its members about the merger after which Societe Generale has been de-listed by the State Bank from the list of the scheduled banks.

Earlier this year Al-Meezan Investment Bank had applied for operating as an Islamic bank under the name of Meezan Bank and the State Bank had accorded the permission. The investment bank had also applied for taking over Pakistan operations of Societe Generale to become part of the proposed Islamic bank. The bank was allowed to do so and the amalgamation became effective from April 30.

The officials of Meezan Bank say the bank has started operating with five branches — three in Karachi and one each in Lahore and Islamabad.