1.1 This Standard Regarding Profit Equalization for Islamic Banks (“the Standard”) constitutes additional requirements to the Standards Re Risk Management Requirements for Islamic Banks issued by the Central Bank. This Standard is mandatory and enforceable.

1.2 This Standard is issued by virtue of the powers conferred by the Central Bank under the provisions of Decretal Federal Law No. (14) of 2018 Regarding the Central Bank & Organization of Financial Institutions and Activities and its amendments (“the Central Bank Law”).

1.3 This Standard elaborates on the supervisory expectations of the Central Bank with respect to profit equalization in Islamic Banks and it must be read in conjunction with the regulations, standards and resolutions issued by the Central Bank and the Higher Shari’ah Authority (“HSA”).

1.4 For the Shari’ah aspects related to profit equalization, all Islamic Banks and banks housing an Islamic Window operating in the UAE (“Islamic Banks or “IBs”) are required to comply with the Shari’ah requirements issued by the HSA.