Africa

Nigeria's regulators aim for debut sovereign sukuk in 2016

Nigeria's debt management office (DMO) and capital market regulator have agreed to collaborate on a debut issuance of sovereign Islamic bonds (sukuk) before the end of the year, the two bodies said. The move could spur wider issuance of sukuk in one of Africa's most liquid debt markets, following similar sovereign deals from Senegal and Ivory Coast. Issuing a sovereign sukuk will attract significant amounts of affordable capital from the Gulf countries and other established Islamic markets around the world into Nigeria, the DMO said in its statement on Wednesday. The statement did not give a potential size for a maiden sukuk deal, although the DMO is a regular issuer of five- and ten-year local-currency bonds.

Islamic banking’ll boost economy if well harnessed, says Emir Sanusi

Emir of Kano, Muhammad Sanusi II, has said Islamic Banking institution can revitalise the troubled Nigerian economy if well adopted. According to him, one of the major benefits of the system is to reduce poverty. He spoke yesterday at the Third Annual Holiday Convention of the Guild of Muslim Professionals (GMP) at the Administrative Staff College of Nigeria (ASCON), Topo, Badagry in Lagos State. The former Central Bank of Nigeria (CBN) Governor, who disclosed that non-Muslim countries including Cote d’Voire, Senegal and Gambia are picking interest in the Sukuk, the Islamic banking system, also called for increased awareness on the Islamic Banking system. He urged scholars to avail themselves of the opportunity of the training sessions organised by the Central Bank of Nigeria.

Uganda embraces Islamic banking

Financial inclusion in Uganda is expected to deepen following a move by Parliament to enact a new financial law hence paving way for Islamic banking in the country. The legislators passed the Financial Institutions (amendment) Bill 2015 on Jan.7, a decision that will see individuals who had been locked out of mainstream banking by virtue of their faith or religious affiliation able to access financial services with less hindrance, once signed into law. The law will also allow financial institutions to roll out agency banking as well as offer ‘bancassurance’ products. According to Bank of Uganda data, the country’s bank account holders stand at just four million — mainly from the urban areas — out of the bankable population of about 12 million people.

Sukuk 2015 : La première tranche de 150 milliards Fcfa mobilisés avec succès

Plus de 67 milliards de Fcfa mobilisés hors Uemoa (45%), 55 milliards F cfa mobilisés en Côte d’Ivoire (37%) et 26 milliards de Fcfa dans l’espace Uemoa (17%). C’est le résultat de la première tranche de la levée de fonds sur la finance islamique, dénommée « Sukuk Etat de Côte d’Ivoire 5,75% 2015-2020 ». Lancée en novembre 2015, sous la présidence du Premier ministre Daniel Kablan Duncan, le Sukuk qui s’inscrit dans un programme quinquennal pour un montant de 300 milliards Fcfa, est repartie en deux phases de 150 milliards chacune. Arrangée par la Société islamique de développement (Sid), cette levée de fonds, qui affiche un titre minimum de 10.000 Fcfa pour un taux d’intérêt de 5,75% l’an, a permis à la Côte d’Ivoire d’être primée « Sukuk deal of the year » et « Africa deal of the year » par le journal Islamic Finance News.

Ivory Coast offers inaugural CFA 150 billion Sukuk

Ivory Coast offers inaugural CFA 150 billion Sukuk. The Sukuk is an amortising Sukuk al-Ijara and is targeted at local banks and institutional investors. It mirrors the Senegal Sukuk that Hogan Lovells advised on in 2014. Hogan Lovells' team was led by Global Head of Islamic Finance, Rahail Ali and Partner Imran Mufti. They were assisted by Partner Baptiste Gelpi, International Debt Capital Markets, Paris and Lina Bugaighis, Dubai. Hogan Lovells worked togehter with ICD for the issue. Imran Mufti commented that more sukuk from African issuers are expected in the near future. Zaky Sow, Sukuk Project Manager for ICD added that the Sukuk opens up a whole new stream of investment into the country.

Hogan Lovells advises on debut sukuk for the government of cote d'ivoire

Hogan Lovells has advised the Islamic Corporation for the Development of the Private Sector (ICD), as arranger, on the inaugural CFA150 Billion sukuk offering by the Government of Côte d'Ivoire. The sukuk is an amortising sukuk al-ijara and is targeted at local banks and institutional investors. It mirrors the successful Senegal sukuk that Hogan Lovells advised on in 2014. Hogan Lovells' team was led by Global Head of Islamic Finance, Rahail Ali and Partner Imran Mufti. They were assisted by Partner Baptiste Gelpi, International Debt Capital Markets, Paris and Lina Bugaighis, Dubai. Hogan Lovells is an international legal practice that includes Hogan Lovells International LLP, Hogan Lovells US LLP and their affiliated businesses.

Islamic International Rating Agency Assigns National Scale Investment Grade Ratings for Al Baraka Bank Sudan (ABBS), a majority owned subsidiary of Al Baraka Banking Group (ABG)

Al Baraka Banking Group (ABG) has announced that Islamic International Rating Agency (IIRA) has assigned national scale investment grade credit ratings of 'A- (SD)/A-2 (SD)' (A Minus/A Two) to Al Baraka Bank Sudan (ABBS or 'the bank'), its majority owned subsidiary in Sudan operating since 1984. Outlook on the assigned rating is 'Stable'. IIRA observed that ABBS maintains sizable liquid reserves, with solid liquidity and that asset quality indicators have improved and are better than the banking sector average. The bank achieved a general improvement in profitability, driven by consistent increase in gross revenue supported by low cost of deposit funding. The rating has taken into account the various economic and financial challenges faced by banks in Sudan.

IIRA assigns Fiduciary Ratings to Al Baraka Bank Sudan

Islamic International Rating Agency (IIRA) has assigned national scale credit ratings of 'A- (SD)/A-2 (SD)' (Single A Minus/A Two) to Al Baraka Bank Sudan (ABS). Outlook on the assigned rating is 'Stable'. Ratings derive strength from the bank's franchise and an overall conservative approach to business. Its retail presence in Sudan, is reflected in a cost effective deposit base. Ratings take into account the various economic and financial challenges faced by banks in Sudan. ABS derives strategic guidance from its parent's international experience and established banking processes and systems. The fiduciary score has been assessed in the range of '71-75', whereby rights of various stakeholders are adequately defined.

IIRA assigns Fiduciary Ratings to Al Baraka Bank Sudan

Islamic International Rating Agency (IIRA) has assigned national scale credit ratings of ‘A- (SD)/A-2 (SD)’ (Single A Minus/A Two) to Al Baraka Bank Sudan (ABS). Outlook on the assigned rating is ‘Stable’. Ratings derive strength from the bank’s franchise and an overall conservative approach to business. While impairment is high in absolute terms, overall asset quality indicators have improved on a timeline basis. The bank features general improvement in profitability, with revenues growing consistently. Capitalization levels remain notably higher than the minimum required and industry average. However, given risks in the general environment, reinforcement of capital as envisaged under the bank’s strategy would strengthen its risk profile and support future balance sheet growth.

Islamic finances face massive demand boom in Africa

Africa is expected to see a massive population boom, many of whom will grow up Islamic. As such, demand for Islamic products and services on the continent are expected to rise in the coming years. Financing projects through Islamic financial instruments has massive potential within the African region. One such instrument is sukuk. This is beneficial to projects that require long term financing. These opportunities are not only for delivering Sharia-compliant goods and services to the Muslim population. Even in countries with a low proportion of Muslims, the values and principles of Islamic financing—such as investment products that avoid alcohol or gambling, and no-interest lending—appeal to investors seeking ethical schemes or banking customers seeking alternative products.

‘JAIZ Bank not troubled, wants more players in Islamic banking’

Chairman, JAIZ Bank, Alhaji Umaru Abdul Mutallab has denied that the institution is distressed and called for more players in the Islamic banking system in a bid to compete favourably in Nigeria’s financial sector. He made the call in Kaduna while donating cash and non-food items to two foundations by the JAIZ Foundation, saying the bank’s deposit base was increasing astronomically. Engr. Garba Muhammad, Mutallab disclaimed text messages in circulation that the bank was in trouble and assured that it was growing day by day. The bank has recently got approval in principle for a national licence to operate in all regions of Nigeria, he added.

Gulf investment in Africa: Key trends and opportunities

The Dubai Chamber of Commerce and Industry recently commissioned a study on the opportunities for Gulf investors in the African market. The research, conducted by the Economist Intelligence Unit (EIU), revealed growing commercial interests between the regions. While trade between the Gulf Co-operation Council (GCC) and Africa remains modest, foreign direct investment (FDI) is growing. For example, a number of African multinationals have set up their headquarters in Dubai, such as Mara Group and Atlantic Holdings. On the other side, the EIU’s research shows that between 2005 and 2014 Gulf firms injected at least US$9.3bn in FDI into sub-Saharan Africa, with a further $2.7bn in the first half of 2015 alone.

How Sukuk Islamic bond Can Help Reduce Nigeria’s Infrastructural Deficit – Emir of Kano

Nigerian financial operators have identified Sukuk Islamic bond as a major tool that can be used in closing the country’s gap on infrastructural deficit. Raising from the two days 2nd international conference on Islamic Finance which opened on the 30th Nov and closed 1st of Dec 2015 in Abuja, financial experts from the country’s public and private sector having exhaustively deliberated with their international global counter parts, resolved to urgently turn up the volume on enlightenment campaigns so as to create the required awareness to investors and operators on the potentials of Sukuk.

2nd International Conference on Islamic Finance

Nigerian financial operators have identified Sukuk Islamic bond as a major tool that can be used in closing the country's gap on infrastructural deficit. Raising from the two days 2nd international conference on Islamic Finance which opened on the 30th Nov and closed 1st of Dec 2015 in Abuja, financial experts from the country's public and private sector having exhaustively deliberated with their international global counter parts, resolved to urgently turn up the volume on enlightenment campaigns so as to create the required awareness to investors and operators on the potentials of Sukuk. The conference also recognized and appreciated individuals whom have contributed immensely in Islamic banking in Nigeria and globally.

Nigeria: FG Mulls Exploration of Sukuk for Budget Financing

The Directors General of the Infrastructure Concession Regulatory Commission (ICRC) Aminu Diko and Debt Management Office (DMO) Dr. Abraham Nwakwo have said that Nigeria would not be left behind in benefiting from the growing global Sukuk. They gave the assurance on Tuesday in Abuja at the two-day 2015 International Conference on Islamic Finance themed: "Islamic Capital Market: Infrastructure, Sukuk and Asset Management in Africa". Based on a 30-year National Integrated Infrastructure Master plan (NIIMP), Nigeria requires an expenditure of US$ 3.10 trillion in 30 years covering energy, transport, agriculture and water resources, social infrastructure and vital registration and security.

Pourquoi la finance islamique séduit de plus en plus les pays africains En savoir plus sur

Après l’Afrique du Sud et le Sénégal, la Côte d’Ivoire lance à son tour une émission de sukuks. Le pays vient de lancer une émission de sukuk, pour 150 milliards de francs CFA, soit 230 millions d’euros. L’opération a commencé le 20 novembre, et les investisseurs peuvent souscrire jusqu’au 21 décembre. Les fonds obtenus seront affectés à des projets de développement. En cas de succès, le gouvernement ivoirien compte bien renouveler l’opération ultérieurement. Il pourrait également faire des émules chez ses homologues, notamment au Niger et au Nigeria. Pour ces pays, l’intérêt de ce type d’emprunt est d’abord de diversifier leurs sources de financement.

UPDATE 1-MOVES-Standard Chartered appoints CEO for Islamic banking business

Standard Chartered has appointed Rehan Shaikh as chief executive of its global Islamic banking business, it said in a statement on Wednesday.
Shaikh moves to Standard Chartered Saadiq from Dubai Islamic Bank, where he was senior vice president and business head, private sector and transaction banking. He previously worked for StanChart in Pakistan from 1998 to 2007, the statement said.
He takes over from Sohail Akbar, who was interim chief executive of the Islamic banking operation after the departure of Afaq Khan earlier this year.
StanChart remains committed to the business despite a period of hiatus across other parts of the bank as global chief executive Bill Winters moves to restore profitability. It announced plans this month to reduce costs by $2.9 billion by 2018 and cut 15,000 jobs.
"Islamic finance is an integral part of the business at Standard Chartered and we continue to see growing demand from clients in many of our markets," said Sunil Kaushal, the bank's regional chief executive for Africa and the Middle East.

Ivory Coast launches Sovereign Sukuk

Five year 150 billion CFA issuance sukuk priced at a profit rate of 5.75%
The Ivory Coast is to become the latest state to issue a Sovereign Sukuk as it today launched its debut five year 150 billion CFA issuance sukuk priced at a profit rate of 5.75%. The addition of the Ivory Coast displays the continued growth of the Islamic finance market into Africa and represents a highlight in quiet year for sukuk issuance’s with total issuance volumes down considerably due to tightening of liquidity in traditional Islamic financial markets of the Gulf and South East Asia.
The sukuk is being arranged by the Islamic Corporation for Private Sector Development (ICD). The ICD signed an agreement in April 2015 for the implementation of a five-year Sukuk programme for 300 billion CFA to be issued in two equal phases of 150 billion CFA each. A road show was held in Saudi Arabia from 14 to 19 November and followed a recent upward revision of the Ivory Coast’s sovereign rating by Moody’s from B1 to Ba3.

Value of global Islamic finance assets projected to reach $3.2 tn by 2020

Global Islamic finance assets had an estimated value of $1.8 trillion in 2014 and are expected to almost double by 2020 to reach $3.2 trillion, according to the ICD Thomson Reuters Islamic Finance Development Indicator.

The projections come ahead of the 2015 World Islamic Banking Conference (WIBC 2015), which will be hosted by Thomson Reuters, the world's leading provider of intelligent information for businesses and professionals, and The Islamic Research and Training Institute (IRTI), an affiliate of the Islamic Development Bank Group.

New bond scheme for Mideast, N. Africa World Bank: World Bank official

A new international bond and grant scheme to help countries dealing with the fallout of war and instability in the Middle East and North Africa should be in place by spring, a senior World Bank official said.
In a Reuters interview, Hafez Ghanem, the World Bank's vice president for the Middle East and North Africa, said the type of investment targeted by the plan - education, infrastructure and jobs - was vital to addressing the region's refugee crises. He said that humanitarian aid alone was not enough and the alternative was “one or two lost generations” in a region with 15 million refugees or internally displaced people.

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