IFR 5.1.1 Guidance
1. A PSIA does not constitute a Deposit , because a PSIA is managed in relation to property of any kind, and the risk of loss of capital, to the extent of the Client's contribution, remains with the Client . Accordingly, an Authorised Firm should take great care to ensure that a PSIA is not represented as a Deposit , either directly or indirectly. The DFSA may conclude that the Authorised Firm is Accepting a Deposit instead of Managing a PSIA in certain circumstances, for example, where the Authorised Firm attaches to the investment account characteristics or facilities that are generally regarded to be those of a Deposit or current account such as providing:
a. an explicit or implicit guarantee to the Client against the risk of loss of capital; or
b. a cheque book, an ATM card or a debit card.
2. The prudential Category for Islamic Financial Institutions and other Authorised Firms Managing PSIAs is determined in accordance with the Rules in PIB. Prudential Category 5 firms are Islamic Financial Institutions whose entire business is conducted according to Shari'a and are authorised to manage Profit Sharing Investment Accounts . An Authorised Firm which manages PSIAs , whether as an Islamic Financial Institution or through an Islamic Window , must also comply with the requirements in PIB in relation to specific prudential requirements relating to Trading Book and Non-Trading Book activities, including Credit Risk , Market Risk , Liquidity Risk and Group Risk .
Derived from DFSA RM69/2010 (Made 1st March 2010). [VER1/03-10]
[Amended] DFSA RM115/2012 (Made 15th October 2012). [VER5/12-12]
[Amended] DFSA RM115/2012 (Made 15th October 2012). [VER5/12-12]