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KUALA LUMPUR: CIMB Group via CIMB Islamic Bank Bhd, targets RM1 billion in deposits from its Islamic fixed deposit — Advance Profit — programme over the next five months.
The bank said last Friday that it was the first Islamic financial institution in the country to offer an Islamic fixed deposit that allowed depositors to collect cash instantly upon opening an account.
CIMB head for retail banking Peter England told reporters at the launch of the product that he was confident the product would “attract over RM1 billion over that period of time (five months),” and would contribute about 5% to CIMB Islamic’s retail deposit. Also present was CIMB Islamic chief executive officer Badlisyah Abdul Ghani.
Advance Profit allows customers to place a minimum deposit of RM10,000 for three months and they can immediately collect 3.35% of their invested amount upon deposit. The rate is available for a limited period. It can be used as security against another loan.
Badlisyah said that depositors could choose to collect in the form of cash, banker’s cheque, demand draft or transfer it to other CIMB bank or CIMB Islamic savings or current accounts.
Depositors can withdraw their principal when the three months expires, or renew their deposit upon maturity by crediting the principle amount back to Advance Profit.
However, England said: “If you withdraw the principal before maturity, you get your money back with the taken interest deducted.”
The current limit was three month as it “allows us to provide a significantly higher profit rate”, he said. CIMB Islamic would look into a minimum of one month and a maximum of five years but this would hinge on sufficient volume.
Advance Profit is a syariah-compliant account also known as Fixed Return Investment Account-i (FRIA-i) based on the Tawarruq concept in relation to Commodity Murubahah, which requires the customer to appoint the bank as an agent to purchase a commodity on a cash basis |
