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Asia Pacific Investment Bank to launch new Islamic digital finance fund

Asia Pacific Investment Bank (APIB) will be launching an Islamic digital finance fund in Malaysia to invest in shariah-compliant financial technology (fintech) start-ups. The fund will be launched in collaboration with OUD Asset Management, a boutique fund management company. APIB director Datuk Foo Yong Hooi said the bank also collaborates with Ripple to explore ways to facilitate cross-border transactions more efficiently. According to Foo, the collaboration with OUD is very important now as the financial industry is adopting digital transformation at a pace faster than ever before, and this fund would be able to support the digital economy transformation of Malaysia.

Arabesque: An Islamic Fund That Bucks the Trend

Arabesque is a UK based fund manager. Their basic premise is that they combine cutting-edge artificial intelligence and algorithms with a powerful ethical screening tool. Arabesque consists of academics coming from a diverse array of fields including physics, computer science, artificial intelligence, and engineering. Through machine learning, big data and over 2501 environmental, social and governance metrics (ESG), its help investors to make more sustainable decisions. It also live-captures news signals from over 30,000 sources from over 170 countries and quantifies this information to form part of the analytics. Arabesque Q3.17 Systematic is a global Shariah compliant fund launched in 2015, adhering to Shariah investment guidelines and utilising the Systematic strategy. The smart algorithms adhere to a strict rules-based, quantitative approach and incorporate the Islamic shariah guidelines from AAOIFI.

Digitization In Banking Market will touch a new level in upcoming year with Top Key Players like Islamic Insurance Company, JamaPunji, AMAN, Salama, Standard Chartered

The Digitization In Banking Market report focuses on the comprehensive analysis of current and future prospects of the Digitization In Banking industry. Top Key Vendors of this Market includes: Islamic Insurance Company, JamaPunji, AMAN, Salama, Standard Chartered, Takaful Brunei Darussalam, Allianz, Prudential BSN Takaful, Zurich Malaysia, Takaful Malaysia and Qatar Islamic Insurance Company. The report can be purchased at https://www.a2zmarketresearch.com/buy?reportId=64965

Shariah-compliant businesses shown to rate more highly in ESG than conventional firms

According to a recent analysis by asset management firm Arabesque, Shariah-compliant companies scored better than the overall group in 19 out of 22 environmental, social and corporate governance (ESG) categories. For the vast majority of 22 business topics, Shariah-compliant companies outperform the wider dataset, and most strongly in the areas of labour rights, human rights, environmental management and water use. One of the most recent companies to adopt the AAOIFI Code of Ethics for Islamic Finance Professionals is Ethis Global, which believes it is the first Islamic fintech to do so. The Malaysian social crowdfunding platform is also a signatory to the the United Nations Global Compact (GC).

With building blocks in place, #Malaysia says it’s ready to welcome Islamic fintech investors

The Islamic fintech space is growing in Malaysia, with recent entrants and an expanding consumer base. Government support and related initiatives are helping to drive the sector’s development. There are currently some 26 Islamic fintechs operating out of the country. While Malaysians have the possibility to bank in a Shariah-compliant manner, Islamic fintech has not yet reflected the same range of services that conventional fintech has offered, particularly in North America, Europe and China. Such gaps in the market have yet to be tapped, but there is a ready market for such services. A new digital bank could drive sectoral development, with Bank Negara Malaysia granting five licenses, with one potentially an Islamic provider.

Cover Story: Sustaining the performance of shariah funds

Shariah-compliant investments are resilient and even tend to perform better than their conventional peers in troubled times. This was proven during the first half of the year, when the average returns of global and Malaysian equity shariah funds were higher than those of their conventional counterparts. Ismitz Matthew De Alwis, executive director and CEO of Kenanga Investors, notes that shariah funds in general have outperformed due to their lack of exposure to the banking sector and a higher weighting in defensive sectors such as healthcare and telecommunications. Despite signs of improving economic data, De Alwis expects the equity market to remain volatile. As the market grapples with the risk of surging Covid-19 infections, governments could be forced to reimpose restrictions on business activities.

Amanie Shariah supervisory board endorses Walton’s land investment product as Shariah-compliant

The Walton Group's Exit-Focused Land investment has been endorsed by the Amanie Shariah Supervisory Board as a Shariah-compliant investment product. Walton’s exit-focused pre-development land investment provides an innovative solution to U.S. public homebuilders as they move to streamline and optimize their land inventory pipelines. Walton is a privately owned, leading global real estate investment, land asset management and administration company that has focused on strategically located land in major growth corridors for 40-plus years. The company manages and administers US$3.39 billion of real estate assets in North America. Walton has more than 104,000 acres of land under ownership, management and administration in the United States and Canada.

#Egypt signs $2bn conventional, Islamic facility to finance budget deficit

Egypt’s Ministry of Finance has signed the first conventional and Islamic financing facility, worth $2bn, to finance the state’s budget deficit. The facility was closed by Emirates NBD Capital Limited, and First Abu Dhabi Bank (FAB) as the transaction’s global coordinators, mandated lead arrangers, and book runners. The main authorised regulators and the offering managers include Mashreq Bank, ABC Islamic Bank, British Standard Chartered Bank, Islamic HSBC, the Arab Banking Corporation (ABC), and the Japanese Sumitomo Mitsui Banking Corporation.

Indonesian personal finance portal Finansialku eyeing more investors with new Islamic feature

Indonesian personal finance assistant PT Solusi Finansialku plans to launch a dedicated Islamic feature to capture a broader base of investors. Finansialku currently has more than six certified financial planners focused on Shariah-compliant investing but lacks a dedicated Islamic section on its app and platform. Its app has been downloaded 203,000 times since April 2017 and it is targeting 4 million downloads by 2022. Finansialku started in 2013 and only digitalised in 2016, moving its services online and to an app. Its advisors are CFPs certified by the national authority the Financial Planning Standards Board (FPSB).

Dubai lifts veil on debt, showing it owes much less than thought

Dubai made a rare foray into public bond markets, revealing that its debt burden is now a lot smaller than estimated by analysts only months ago. The emirate’s outstanding direct debt stood at 123.5 billion dirhams ($33.6 billion) as of June 30. That’s about 28% of last year’s gross domestic product. Dubai's economy is heavily dependent on tourism, trade and retail, sectors hardest hit by the emergency. The global pandemic forced Dubai to delay this year’s World Expo. The government revised this year’s budget revenue to 44.2 billion dirhams down more than 30% from what it originally envisaged. It also decreased its projected expenditure to 56.2 billion dirhams for 2020, leaving a deficit of 11.9 billion dirhams. Dubai owes a total of $20 billion to the Abu Dhabi government and the UAE central bank, an amount it used to support strategic entities that required financial assistance.

Sustainability and Islamic Finance in the United Arab Emirates

The targets set by the UAE to prepare the country’s economy for a post-hydrocarbon era have been very ambitious. As part of its economic diversification actions, the UAE has undertaken to increase the clean energy contribution to the total energy mix from 0.2% in 2014, to 24% by 2021. In the UAE Energy Strategy 2050, a target is set of cutting carbon dioxide emissions by 70% by 2050 and increasing the use of clean energy to meet 50% of the country’s energy needs by the same year. The Dubai Clean Energy Strategy 2050 similarly sets out the emirate’s aim of transforming Dubai into a global clean energy centre. These goals will require considerable capital investment. However, while other centres for Islamic finance have seen a growing number of responsible finance sukuk issuances, there have been noticeably fewer issuances in the UAE. Mobilising private sector finance through responsible financing activities will be critical in helping the UAE government to meet its extensive sustainability targets.

Dubai to come back to debt market with 10-year #sukuk, 30-year bonds

Dubai has hired banks to arrange investor calls ahead of a potential sale of U.S. dollar-denominated 10-year sukuk and 30-year conventional bonds. Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, and Standard Chartered are mandated to arrange the calls. The benchmark issuance is part of a $6 billion sukuk issuance programme and of a $5 billion bond issuance programme. The new issuance could bolster the finances of the Middle East trade, finance and tourism hub, which has been hit hard by the coronavirus crisis this year.

#Qatar- Masraf Al Rayan's $750mn #sukuk generates overwhelming demand from global investors

Masraf Al Rayan has announced the issuance of $750mn Sukuk with a term of five years under the bank's existing $2bn sukuk programme. The issuance was 4.4 times oversubscribed to the tune of nearly $3.3bn. The overwhelming demand from investors has allowed the bank to increase the issue size from an initial $500mn to $750mn. The issuance was priced at a spread of 185 basis points over the five-year mid swap carrying a fixed profit rate of 2.21% per annum. Al Rayan Investment, Crédit Agricole CIB, HSBC, Mizuho, MUFG, QNB Capital, Société Générale and Standard Chartered Bank acted as joint lead managers and bookrunners on this transaction.

Millennium launches worldwide operations in Dubai to help $2.5 trillion international Islamic finance sector

Islamic banks have emerged stronger after each monetary disaster which uncovered the weaknesses of the traditional banking methods. Millennium Info Answer FZ-LLC (MISL) launched its operations on the Dubai Worldwide Metropolis to assist Islamic banks to migrate to their new-generation core banking solution called Ababil. Ababil is an end-to-end superior core-banking solution covering Company and Retail Banking, Funding Banking, Financing Origination System, Buyer Info File (CIF), Commerce Finance, Treasury Administration, Agent Banking, Offshore Banking, Revenue Distribution, Accounting & MIS, Payroll, Drilled Down Reporting, and so on. Along with Ababil, MISL is offering its newest human resources solution Sylvia and risk-based auditing solution Tahqiq.

Registration deadline for Ma’an third Social Incubator extended to 12th September

The Authority of Social Contribution, Ma’an, is urging all social entrepreneurs in the UAE and wider MENA region to complete the online application, as the Authority announces an extension for registrations until 12th September. The teams shortlisted for the Social Incubator programme will aim to strengthen the interactions and create stronger emotional bonding between parents, children, relatives, the elderly and couples across the Emirate and highlight the importance of family values. Ma’an will shortlist and support 10 winning social start-ups, who will then undergo a 90 day training programme and develop their ideas into business ventures. Ma’an will invest more than AED 2 million in total in this cycle with the successful applicants also having access to milestone-based funding, mentorship, office space, business expertise and investors.

Kenya: State Urged to Expand Sharia Compliance Loans to Muslims

As the coronavirus pandemic continues to disrupt businesses in Kenya, the Muslim community has been urged to take advantage of financial institutions offering low bank charges. Islamic finance expert Khalfan Abdallah has urged the government to rethink how to accommodate Muslims in various financial support programmes such as Youth and Women Fund. Mr Abdallah said the government should borrow a leaf from Momentum Credit Micro Finance which has started offering Sharia compliance loans to Muslims using logbooks as collateral. He urged the Muslim business community who are affected by Covid-19 pandemic to take advantage of Momentum Sahih products.

Bahrain's GFH inks deal to hold majority share in Sharia investment firm

GFH Financial Group announced that it has acquired an additional 21.8% stake in Global Banking Corporation. The deal gives GFH a majority stake of 50.4% in the Bahrain-based investment bank following Central Bank of Bahrain approval to acquire up to a 60% shareholding. Established in 2007, GB Corp targets high-net-worth individuals and institutional and government clients across the GCC countries. As of December 2019, GB Corp reported total assets of $125 million and assets under management of approximately $500 million.

Islamic Corp. for the Dev. of the Priv. Sec. -- Moody's - ICD's credit profile reflects its robust capital position, strong liquidity balanced against weak asset quality

According to Moody’s Investors Service, the Islamic Corporation for the Development of the Private Sector’s credit strengths lie within its robust liquidity buffer and high quality treasury portfolio. While ICD remained lossmaking in 2019, the size of the losses narrowed significantly, and capital adequacy was supported by ongoing payments from shareholders under the second general capital increase. Moody’s analyst Thaddeus Best expects that the ICD will temper its balance sheet expansion in order to preserve capital. It is anticipated that the bank’s increased focus on term lending operations will help ease credit risk over the coming years.

Why Islamic Finance And Impact Investing Should Join Forces

The Islamic finance sector is growing, and as the global community responds to the COVID-19 pandemic, key stakeholders are working together to address the challenges. Islamic finance will continue to grow over the next decade across asset classes and markets, creating a unique window of opportunity to align components of its investments with the UN SDGs. Impact investing and Islamic finance are complementary and compatible. The UAE and the GCC overall are key hubs for Islamic finance. Further awareness is needed to make Islamic finance leaders and GCC governments to align in this movement, and to continue to consider how they can most effectively capitalize on impact investing to generate positive returns whilst making the ongoing positive impact on society.

Moody's - Structural features underpin Malaysian Islamic banks' resilience against coronavirus fallout

According to Moody’s Investors Service, concentration on retail financing and other structural features will help Islamic banks safeguard against a deterioration in asset quality and profitability. Islamic banks have sufficient loss buffers against financial stress, with their funding and liquidity remaining stable. The seven largest Islamic banks in Malaysia, five of which are subsidiaries of domestic banking groups with conventional operations, have a heavy concentration on retail financing, which is less vulnerable to an economic downturn. In addition, Malaysian banks generally have prudent underwriting practices for retail financing, which adds to their asset quality.

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