international islamic rating agency

The Islamic International Rating Agency (IIRA) has been set up to provide independent assessments to Islamic financial institutions and capital market instruments globally. IIRAs special focus is on development of capital markets in Islamic countries with a rating spectrum that encompasses the full array of financial transactions and institutions. IIRA is sponsored by multilateral development institutions, leading banks and non-bank financial institutions as well as rating agencies. The Islamic Corporation for Development of the Private Sector and the Islamic Development Bank are its most prominent shareholders with a combined stake of about 27%. IIRAs shareholders operate from eleven countries, which constitute the agencys primary markets.IIRA has received formal recognition from Central Bank of Bahrain as an External Credit Assessment Institution (ECAI). IIRA is also on the list of approved rating agencies of Islamic Development Bank. IIRA believes that the strength of Islamic finance lies in its commitment to fairness. This renders the manner in which a transaction is carried out, as important as the transaction itself. IIRAs specialized focus on organizational governance and conduct of Shariah, augments the rating process, and incorporates the unique features of Islamic finance in a way that broadens the quality perspective. Transparency or absence of Gharar is another fundamental pillar of Islamic transactions. Given the nature of its activities, the presence of a rating agency increases transparency and diminishes information asymmetry in markets, while documenting economies. Over time ratings would enhance the quality of investment decision making, enabling fair exchange.