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CA-4.2.19A

The RW for RRE may be reduced to 35% subject to meeting all of the criteria below:

(a) The RRE is to be utilised for residential purposes only;
(b) The subject matter of RRE must be pledged as collateral (or serve as quasi-collateral) to the Islamic bank licensee in the case of Murabaha, IMB or diminishing Musharakah;
(c) There exists a legal infrastructure in the jurisdiction whereby the Islamic bank licensee can enforce the repossession and liquidation of the RRE; and
(d) The Islamic bank licensee must obtain a satisfactory legal opinion that foreclosure or repossession as mentioned in (c) above is possible without any impediment.
January 2015