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Sat 17 Mar 2018 01 Rajab 1439H

Shareholders - Investment Accountholders Relationship Regulation Policy

1.  Need for the Policy

The nature of investment in the funds of ( unrestricted investment accountholders) is varied and not like the individual relationship between one speculator ( Mudarib) and one capital owner( Rab-al-Maal),but there are multiple funds provided to the Bank of varying conditions in terms of the proportion of the part involved in the outcome of investment profits, the minimum balance counted for the purposes of participation in the results of investment earnings, and allow mixture of money in one pool shared by  the unrestricted investment accountholders and shareholders' funds. The balances of these accounts are not fixed during the financial period , but fluctuate by withdrawal and deposit beside other factors that affect the equity of all related parties. Therefore, it has become necessary to set rules and regulatory guidelines for the relationship between the Bank (shareholders) as a speculator ( Mudarib) and investment accountholders as a capital owner (Rab-al-Maal).

2. Scope of the Policy

This policy does not deal with bases/ principles of profits distribution between shareholders  (owners’ equity) and unrestricted investment accountholders , and not with the funds the Bank receives as a restricted speculator/  Mudarib ( investment portfolios /Muqarada bonds). It neither deals with the funds the Bank receives from a third party to be invested in proxy for a specified charge nor the funds the Bank receives as not being a speculator such as cash margins , current accounts and their equivalents.

On the contrary, this policy deals with a set of guidelines and standards which determine rights and duties included in the investment relationship between shareholders and unrestricted investment accountholders which increases the confidence of investment accountholders that the Bank is keen to protect their rights  to an extent similar to its commitment and concern  in protecting shareholders’ interests.

When reading this policy, it is necessary to take into account ( the policy of distributing profits between the Bank ( shareholders/ Mudarib) and investment accountholders ) which is approved by the Bank and considered a part of this policy and a complementary to it.

3.Nature of the relationship between shareholders and unrestricted investment accountholders:

The Bank receives funds from unrestricted investment accountholders as a speculator (Mudarib ) to invest them in the way it deems appropriate and achieve interest. Investment profits are distributed in the light of profit distribution policy adopted in the Bank and according to the terms and conditions set out in the investment accounts forms signed with the related parties.

4.Unrestricted Investment Accountholders Equity

4/1 The Bank must include in its annual report disclosures which make it possible for investment accountholders to follow up the operations and the financial and sharia position of the Bank.

4/2 The Bank must allocate a part of its website to include an illustration of investment accountholders’ equity  and quantitative and qualitative disclosures.

4/3 In case of changing the terms of the accounts or profit rates, the new data shall be presented on the website of the Bank and / or send written letters to accountholders and / or announce it prominently in all the bank’s branches and offices. In case that there is no objection to those conditions within two weeks from the date of announcement, they are considered valid after the expiration of the period directly.

4/4 Investment accountholders have the right to provide the Bank with all data and suggestions that may contribute to develop operations and improve financial revenue whether on the service level or nature of operations level  and to be directive , but not obligatory.

4/5 According to the Bank’s policy that is applied currently, the priority in investment is for the funds of unrestricted investment accountholders. In case of not following the aforementioned, it is disclosed in the way the Bank deems appropriate.

4/6 The Bank’s data and its documents related to the rights of unrestricted investment accountholders are considered sufficient  evidence in case of conflict if the accountholder does not prove their errors, and in such conflicts, it is resorted to experience, arbitration and judicial authorities.

4/7  It is not allowed for investment accountholder  (Saving account ) to withdraw from the account unless he attends personally or who represents him or by request of assign or transfer based on official written letters that are documented according to the signature form or by using  electronic channels.

4/8 It is not allowed for the investment accountholder (Term account )to withdraw from the investment account any amounts till the term expiration unless the Bank agreed on that.But in this case, the withdrawn amount will not be involved in the profits at the beginning of the year in which it was withdrawn and the withdrawn amount is considered the last deposit the client puts at the Bank.

4/9 The saving accountholder is allowed to withdraw from his account amounts that do not exceed the upper limit determined by the Bank, and he is not allowed to withdraw over and above unless he notifies the Bank in writing at least seven days before the withdrawal day.

4/10 The notice accountholder  is not allowed to withdraw  money from his account, unless he presents a written notice to the bank before 90 days of the notification period specified by the bank.

4/11 Participation in investment profits calculation starts  from the beginning of the month following the month in which the amount was deposited and the withdrawn amounts lose their share of participation from the beginning of  the month in which withdrawals made on the account, with the exception of the amounts withdrawn from the( notice account) in a way that violates terms of notification, where  notice period is added.

4/12 The minimum balance that is intended for the purposes of participating in the results of investment profits is at least( one hundred Dinars or equivalent to one thousand Dinars for foreign currencies accounts) for saving and notice accounts and (at least five  hundred Dinars or equivalent to one thousand Dinar for foreign currencies) for term accounts or the limit decided by the BOD for all types of investment accounts. The accountholder is considered withdrawn from the participation if the account balance in any month during a single fiscal year is less than the allocated limit.

4/13 The investment account is renewed on maturity date unless the client notifies the Bank at least before 30 days of that date, then he is entitled to withdraw his deposit.

4/14 The investment accountholder authorizes the Bank to debit any of his investment accounts held at the bank with any currency types and at any time taking into consideration the exchange rate in the entry date, his payables , and all open investment accounts are considered one unit in order to ensure that.

4/15 The foreign currency in which the account is opened is evaluated in Jordanian Dinar on the basis of the average price announced by the CBJ on the day of deposit  and the accounts’ balances are re-evaluated at the end of each month based on the same prices for the purposes of calculating amounts participating in the profits of foreign currencies investment.

4/16  The available balance in foreign currency is assessed at the end of each year on the basis of the average price announced by the CBJ for the same day for the purposes of calculating  and distributing funds participating in the profits of investment in foreign currencies.

4/17 The investment account is considered dormant if it has no transaction of withdrawal or deposit by the client or his agent or authorized person after two years for saving accounts and three years for term and notice accounts or as determined by Central Bank of Jordan (CBJ) from the date of the last withdrawal or deposit  transaction with the impossibility to figure him out through his other dealings with the Bank and after exercising all means of communication. In case the account is considered dormant, the Bank will not allow any withdrawal or transfer from the dormant account, including the suspension of the ATM cards unless the client attends personally or who represents him by virtue of power of attorney or approved authority that is acceptable from the Bank or the presence of the account authorized signatory in case of legal person.

4/18 The Bank is a trusty of its investment accounts and does not guarantee them except in cases of misconduct or negligence or terms’ violation.

5. Responsibilities of the Board of Directors ( BOD )

5/1 Investment decisions are taken in the light of serious credit studies and complete information after exerting  due diligence.

5/2 Adopt sound investment strategy befits expected risks and revenues for investment accountholders and employ qualified investment officers who are able to understand and meet the needs and expectations of investment accountholders.

5/3 Review and direct the Bank’s adopted investment strategy, the business plans, risk policies, activity plans, set performance goals, follow up with investment officers and measure performance level.

5/4 Data and information the Bank obtains from the client and the guarantor within the contractual relationship are subject to the banking confidentiality  provisions stipulated in the effective banking law.

5/5 Provide investment accountholders statements of account or investment accounts upon request and any other correspondence to the address specified in the investment account opening form.

5/6 The Bank does not issue for investment accountholders checks for the purposes of withdrawal from the investment account.

5/7 The Board of Directors decides the participation ratio of saving and notice accounts in the results of investment profits from the annual rate for the balance included in the account and which is announced in the branches of the Bank according to the terms of each account.

5/8 The Board of Directorsdecides the participation ratio of  term accounts in the results of the investment profits of the value of each deposit  by calculating a minimum balance during the financial year involved in it, taking into account the calculation period for each fiscal year by the number of months in which the deposit remained during the relevant financial year, which is declared in the Bank's branches.

5/9 At the beginning ofeach fiscal year, the Board of Directors decides the proportion of the amounts involved in the investment, and participating in the profits, which is announced in the Bank's branches.