Islamic Banking: Home Purchase Financings IV: Bai Bithamen Ajil and Istisna'a - Parallel Istisna'a

2012 Oman Law Blog of Curtis, Mallet-Prevost, Colt & Mosle LLP

7 Pages Posted: 9 Jun 2013

See all articles by Michael J. T. McMillen

Michael J. T. McMillen

Curtis, Mallet-Prevost, Colt & Mosle LLP; University of Pennsylvania Law School

Date Written: November 5, 2012

Abstract

This article describes two structures that are used in Shari'ah-compliant home purchase financings: the bai bithamen agil (BBA; deferred payment sale) and the istisna'a - parallel istisna'a (construction contract - parallel construction contract). The BBA structure is used primarily in Malaysia and other Southeast Asian jurisdictions, and is used in other areas of real estate finance as well. The istisna'a - parallel istisna'a is used in construction of real estate projects and in other project financings and infrastructure financings.

Keywords: Islamic banking, banking, Islamic finance, bai bithamen ajil, BBA, istisna'a, mortgage, house, home, real estate, project finance, infrastructure finance

JEL Classification: E40, E41, E44, F00, F02, F20, F21, F23, F30, G21, G24, G29, G30

Suggested Citation

McMillen, Michael J. T., Islamic Banking: Home Purchase Financings IV: Bai Bithamen Ajil and Istisna'a - Parallel Istisna'a (November 5, 2012). 2012 Oman Law Blog of Curtis, Mallet-Prevost, Colt & Mosle LLP, Available at SSRN: https://ssrn.com/abstract=2276267

Michael J. T. McMillen (Contact Author)

Curtis, Mallet-Prevost, Colt & Mosle LLP ( email )

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University of Pennsylvania Law School ( email )

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