In a bid to meet changing minimum capital base requirements, which was set at $200 million last year by the Central Bank of Nigeria (CBN), the lead promoters Jaiz International Plc, the holding company of JBI, embarked on IPOs and private placements between 2003 and last year as the first and second phases.

The third and final phase of the bank's recapitalisation programme would involve an offer for subscription to raise about $164 million during the second quarter of this year.

The promoters have therefore held talks with both existing shareholders and prospective investors, Dr. Amaru Abdul Mutallab, chairman of JBI said.

The commencement of operations of JBI is therefore subject to the successful completion of it's various capital raising exercises and final issuance of the bank license by CBN.

JBI'S BANKING PRODUCTS
Against a background of a predominantly conventional banking industry in an environment characterised by volatile interest rates in the country, JBI will offer the following products:

Jaiz Current Account: This will be similar to a current account as in conventional banking but a marked difference would be that no interest would be paid to depositors. It is essentially a safe keeping (Al-Wadiah) arrangement between the depositor and the bank, which allows depositors to withdraw their funds at any time. Chequebooks shall be issued to depositors in this account while the bank will provide a wide range of payment facilities and clearing mechanisms, bill of exchange and travellers cheques. For this service the bank will charge commission on turnover, but a nominal administrative charge is payable. The bank would require the permission of the account holder to make use of the funds.

Jaiz Savings Deposit Accounts: This will include Jaiz Regular Savings Account (under Al-Wadiah), Jaiz Haji Savings Account and Jaiz Savings Account (under Mudarabah).

All savings deposit accounts will operate similarly to conventional savings accounts with balances payable on demand. However, under the Mudarabah arrangement, the depositor may allow the bank to invest in deposits in short-term initiatives and thus share in a proportion of the general profits.

Jaiz Investment Accounts: This is similar to fixed term accounts. Monies are deposited with the bank for a certain period of time. The bank is to offer two types of investment accounts, namely the Joint Investment Account and the Specified Account.

Joint Investment Accounts: This involves the entering into a Mudarabah contract by the depositors with the bank, whereby depositors are jointly considered as Mudarib (lenders). The depositors will authorise the bank to select suitable investment and projects profits are shared according to agreed profit sharing ratios between the bank and the investing depositors. Losses shall be borne by the investing depositors and the bank in proportion to their contribution unless the bank is demonstrably negligent it in violation of agreed terms.

Specified Investment Accounts: Under this type of account, the bank will receive monies from depositors who wish to appoint the bank as an agent for investing their deposits in specific projects or in specific manner on the basis that the bank will receive a part of the net profits realised, but will not be liable for any loss which is not attributable to any violation or fault by the bank.

Other Products: The bank will also cover micro credit finance, cost-plus financing (Murabaha), leasing (Ijarah), trust financing agreements (Mudarabah), equity participation (Musharaka) and Istisnaa (a contract for the acquisition of manufactured goods, by specification, or order, where the prices is paid gradually in accordance with the progress of the job),

Services: These will include financing advisory services, letters of guarantee, bills of collection, foreign exchange transaction, fund transfer and letters of credit.

THE ISLAMIC CAPITAL MARKET IN NIGERIA
In preparation for the bank's launch, the Securities and Exchange Commission (SEC) of the country is planning Islamic capital market instruments as alternatives to traditional debt markets that are acceptable is Shari'ah compliant. In the same vein, a Centre of Information and Research in Islamic Economics, Banking and Finance (CIRIEBF) has been established in the northern city of Kano.

FOREIGN SUPPORT FOR JBI
To ensure that JBI's success and those business operations meet international standards, the promoters have made arrangements for technical and management support from the Jeddah based Islamic Development bank (IAB) and the Islamic Bank of Bangladesh.

BOARD OF DIRECTORS
Dr. Umaru Abdul Muttalab, a professional accountant, is the chairman of JBI. He has over 30 years experience in developmental, commercial and merchant banking. He is also currently the chairman of the First Bank of Nigeria Plc (formerly Standard Bank), the oldest and biggest Bank in Nigeria in terms of capital (over $270 million) and second largest in terms of deposits and assets (over $1.5 billion and $2.7 billion respectively). He is also on the board of several major companies in Nigeria.

Dr. Rilwanu Lukamn: A renowned figure in the international oil and gas sector. He is a mining engineer with over 40 years experience in the oil and gas sector. He has been president of the OPEC conference eight consecutive times and also served as secretary general the same organisation from 1995 -2000.

Alhoju Abdul Lateef Adegbite: A distinguished lawyer and solicitor to the supreme court of Nigeria with over 40 years experience in the legal industry working with a pool of local and international corporate and individual clientele. He is also the secretary general of the Nigerian supreme council for Islamic affairs since 1989 and was legal advisor to the council from 1974-1989. He has written and presented over 50 papers on all aspects of legal practice to his credit.

In response to the demands by Nigerian Muslims to have a bank that meets their religious, moral and ethical aspirations, concerted efforts were made by a number of corporate bodies, individuals and Islamic organisations, culminating in the filling of an application by Jaiz International Plc with CBN for a license to operate Nigeria's first wholly non-interest bank.

In November 2003, Jaiz International Plc raised the sum of $15 million, which was then the minimum capital requirement set by CBN. This was done through the issuance of an historic IPO, which was oversubscribed by 120 percent, unprecedented in the history of West Africa's Islamic finance industry.

The CBN after its internal appraisal of the application last year granted JBI an approval-in-principal with a commitment to issue a banking license upon compliance with the minimum capital requirement, which was suddenly increased to $185m only last year.

Nigeria is not only the most populous country in West Africa, with a population of 140 million people, of whom about 60% are Muslims, but it is also the largest economy.