CHAPTER
11Chapter 12: Operating an RF Bank in the United States
United States
Acquiring and Restructuring a Troubled
Bank and Operating It Riba-FreeINTRODUCTION
This chapter covers the efforts we went through to acquire and operate a
full service bank in the United States. This chapter is a must for anyone who
may be interested in buying and operating a bank in America. It is also a
useful step-wise discussion that should benefit those who want to re-
structure a troubled bank and bring it to a healthy and a profitable condi-
tion. Finally, this chapter is important for those who are interested in
operatingariba-basedbankinAmerica and the West in a riba-free (RF)
format without having to go through the lengthy and expensive process of
trying to obtain exceptions from the regulators. As was stated earlier in the
book, RF banking is not about changing words and using circumventive
techniques to make the contracts ‘‘compliant’’ with the Law (Shari’aa). RF
banking is a new brand of banking that applies the spirit and substance of
Judeo-Christian-Islamic values. It is about the use of principles that would
save the consumer and the businesses from participating in an economic
bubble like that of 2008.
One of the options we considered in 1987 when LARIBA was started
was to organize it in the form of a depository institution (meaning a bank).
We reasoned that this option would offer us the ability to take deposits and
to offer insurance on deposits through the Federal Deposit Insurance Cor-
poration (FDIC). However, we knew nothing about the business of starting
a bank in the United States. We were told by many of our friends that the
process of starting or buying an existing bank is called change of control of
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