IslamicFinance.de

Fitch Ratings says that 2009 proved to be, as anticipated by Fitch, a challenging year for banks in Saudi Arabia as the full impact of the global economic crisis caught up with the region, reflected in rising loan impairments and a rapid slowdown in lending. The preliminary 2009 results released by the 10 main Saudi commercial banks rated by Fitch showed different trends in net income in 2009, with Q409 being the worst quarter of the year.

Fitch notes that five of the 10 largest commercial banks operating in Saudi Arabia showed improvements in their net income y-o-y, but overall growth in total net income for all 10 banks stagnated in 2009 y-o-y (2008: -14.2%). Areas of concern included lower domestic economic growth, mainly reflecting lower oil revenues and exports, and the negative impact on asset quality of recent rapid credit growth as well as problematic exposures to some large Saudi trading groups (primarily Algosaibi and Saad). The agency has yet to see the full audited financial statements of the Saudi banks but will review them fully in the near future. At this stage, Fitch does not expect to see further downgrades of Individual Ratings in 2010.

Nobel Laureate Professor Muhammad Yunus and the Chairman of the Board of Trustees of the Royal Charities Organization, Prince Shaikh Nasser bin Hamad Al Khalifa inaugurated the Family Bank, a microfinance bank licensed by the Central Bank of Bahrain, at a ceremony held at the Gulf Hotel Convention Hall in Bahrain recently.

Legal & General Gulf Takaful B.S.C (c), a wholly owned subsidiary of Legal & General Gulf B.S.C (c), a joint venture between UK-based Legal & General Group Plc and Ahli United Bank Group (AUB), announced the launch of its retail business in Bahrain.

Thomson Reuters announced the launch of a risk management system specifically tailored for Islamic banking.

Kondor+ Suite for Islamic Banking is a real time trade and risk management solution, which will provide full front-to-back and cross-asset coverage for Islamic banks as well as Islamic windows in conventional banks.

Qatar International Islamic (QIIB) Bank has made a donation to support the programmes of the Centre for Educational Perspectives, Qatar.

The report on Social Responsibility Trends at Islamic Financial Institutions presents the results of an extensive survey on Social Responsibility at Islamic Financial Institutions (IFIs) carried out during summer and fall of 2009 by DinarStandard and Dar Al Istithmar with the support of the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI).

Some key findings of the survey were:

Clients: 100% of respondents answered yes to having a policy to screen prospective clients which is actively implemented. Similarly 97% have an organizational policy that deals with client responsibly.

Employees: 83% of respondents’ state having policies that provide equal opportunity to all their employees, 93% have policies that ensures merit-based salary and promotion, and 86% having policies that specifically prohibits any kind of discrimination. However, when it comes to having policy to monitor employees from different backgrounds and gender, the response was mix with only 52% admitting to having such a monitoring policy and 48% not having any such policy.

Barwa Bank, a major new Qatari financial services provider, today announces the approved acquisition of Qatari based investment shareholding company, The First Investor. The acquisition by Barwa Bank has received full approval from the Qatar Central Bank and filings with the Ministry of Business and Trade are in progress.

Kuwait Finance House (KFH) has revealed plans to expand into the US and Canada in 2010.

Seven Islamic banks were included in this year's study which tested the service quality performance of 27 banks across the UAE. Five of the seven Islamic banks included claimed a place within the top 10 performance ranking table.

Islamic finance in the GCC is emerging as a credible alternative source of ship finance.

Bank of Kuwait and Middle East (BKME) has achieved a growth of 13 percent in the last three years, and is now undergoing a change to become fully Sharia-compliant.

IslamicFinance.de is calling Islamic financial institutions to become member of the UNEP Finance Inititiave to learn and contribute to international best practice in ethical and faith based finance:

"UNEP FI is a global partnership between UNEP and the financial sector. Over 180 institutions, including banks, insurers and fund managers, work with UNEP to understand the impacts of environmental and social considerations on financial performance."

membership information package:
http://www.unepfi.org/fileadmin/forms/MembershipInformationPack.pdf

Press Release

• The improvement in the liquidity position of Bahrain-based Islamic wholesale investment bank Gulf Finance House proved to be more limited, in our view, than we had previously expected.
• We consider the recent unexpected departure of the CEO and the end to talks about a joint venture with Macquarie to be additional challenges to revenue generation.
• We are lowering our long-term rating on GFH to 'B+' from 'BB+' and placing it on CreditWatch with negative implications.
• The negative implications reflect the uncertainties we see about the execution of GFH's measures to improve funding and liquidity.

PARIS (Standard & Poor's) Jan. 14, 2010--Standard & Poor's Ratings Services lowered its long-term counterparty credit rating on Bahrain-based Gulf Finance House G.S.C. (GFH) to 'B+' from 'BB+' and affirmed its 'B' short-term rating. In addition, we placed both the long- and short-term ratings on CreditWatch with negative implications.

Dubai Islamic Bank DISB.DU has not witnessed any significant withdrawals by despositors after news of Dubai World restructuring shook global markets, the lender's financial chief said on Tuesday.

Najd Investments Ltd today announced the opening of its Dubai office following the award of a licence by the Dubai Financial Services Authority (DFSA) to operate from the Dubai International Financial Centre (DIFC).

Ajman Bank, the emirate’s first Islamic commercial bank, has officially announced the appointment of their new Head of Finance Division, Seifeldin Abdelkareem. With a career in the financial field spanning twenty eight years, Abdelkareem has a multitude of experience to contribute as new Head of Finance.

Gulf Finance House (GFH), the leading Middle Eastern Islamic investment bank announced Tuesday that it has bought back US$ 9 million of its sukuk during the 4th quarter of the year.

The Investment Dar Co. K.S.C.C. ("TID") and the Coordinating Committee of banks and investors ("Coordinating Committee") of TID and the Investment Dar Bank ("IDB") are pleased to announce that they have received the support of over 2/3 of TID and IDB banks and investors for the restructuring plan presented in Kuwait City and Dubai on November 24 and 25. As a result, TID and the Coordinating Committee are proceeding with the final implementation of the proposed restructuring plan and are aiming to complete this process as quickly as possible.

Methaq Takaful Insurance is planning new Takaful products that will be launched in 2010, Dr Omar Fisher, advisor to the board of the firm said at a meeting of insurance broker partners. The article did not clarify what type of products are foreseen.

Infrastructure spending is still a major growth driver in the Gulf Co-operation Council countries, with current projects valued at a whopping $2.6 trillion, but alternative funding schemes need to be explored as the global economic crisis is stifling commercial lenders, experts said.