Zawya

Aldar Investments' Landmark US$500 million 10-year #Sukuk attracts strong investor demand

Abu Dhabi-based Aldar Investment Properties issued a fixed rate US dollar-denominated sukuk with a tenor of 10 years for a nominal amount of US $500 million. The sukuk carries a coupon rate of 3.875%, following strong investor demand. The transaction, which marked the first 10-year public Sukuk offering by an Abu Dhabi-based issuer, was over 6 times oversubscribed. Aldar Investments owns and manages a AED 20 billion diversified portfolio of high-quality income-generating residential, retail, commercial and hospitality assets. Aldar Investments owns and manages a AED 20 billion diversified portfolio of high-quality income-generating residential, retail, commercial and hospitality assets.

Al-Nahedh: KFH Has a Proven Track Record in Digital Transformation

Kuwait: Group Chief Executive Officer at Kuwait Finance House(KFH), Mazin Saad Al-Nahedh said that the banking and financial industry is undergoing a process of digital transformation where many processes – often transactional – are being fully automated.

KFH-Turkey... Robust Financial Position, Very High Liquidity Ratios

Group Chief Executive Officer at Kuwait Finance House(KFH), Mazin Saad Al-Nahedh, emphasized that KFH-Turkey enjoys robust financial position and very strong liquidity ratios as per the regulatory authority’s requirements in Turkey and Kuwait, not to mention as per the international standard Basel III.

The Musée du Louvre, Paris, opens new and expanded spaces for exploring Islamic Arts supported by Alwaleed Philanthropies

The Musée du Louvre officially opened new and expanded spaces to explore Islamic art with the support of Alwaleed Philanthropies. The new exhibition space offers visitors an immersive introduction to Islamic art. The center showcases a diverse range of art and artifacts stretching from Spain to India and explains the evolution of Islamic art in style, form and medium. Louvre President Jean Luc-Martinez hopes to reach even more visitors, and provide them the keys to understanding the wonderful artistic heritage. The new and expanded spaces for exploring Islamic art has been designed to offer full disability access and includes a series of interactive displays.

Jibrel to launch first globally regulated blockchain-powered private financing platform

Switzerland-based fintech company Jibrel Network announced the launch of Jibrel.com after its recent acceptance into the new ADGM (Abu Dhabi Global Market) RegLab cohort in the UAE. Jibrel.com claims to be the first fully regulated blockchain-powered private financing platform. Jibrel’s purpose is to foster open financial systems and digitization powered by emerging technologies. Its mission is to tokenize an array of assets in a manner that is borderless, asset class agnostic and customizable for different use cases. The new platform will enable investors of all genres to connect with startups and SMEs, creating new capital formations. Talal Tabbaa, co-founder and COO of Jibrel believes this platform will transform the MENA startup ecosystem by providing access to a broader investment base, so that startups will raise more liquidity, and spur the growth of the sector further in the region.

Global #sukuk issuance to equal $130bln in 2019

According to Moody's Investors Service, the value of global sukuk issuance is expected to increase by 6% to reach $130 billion in 2019. That forecast can be ascribed to the increase in sukuk activity in Saudi Arabia and Malaysia, which manifested by the issuance of $87 billion sukuk in the first six months of 2019. Moody’s senior vice president Nitish Bhojnagarwala expects second-half volumes to moderate to around $43 billion, though Malaysia and Gulf Cooperation Council countries will continue issuing regularly. Key Islamic finance markets are working on adjusting their funding mix to support a long-term growth in sukuk volumes. As awareness towards the risk of climate change increases, the green sukuk market is expected to grow further.

UNHCR's Refugee #Zakat Fund raises $38.1mln; assists 111,209 families

The UNHCR’s Refugee Zakat Fund has raised $38.1 million in six months and supported 111,209 families (648,476 individuals) across seven countries. The United Nations' refugee agency’s zakat fund is a Sharia-compliant structure that channels zakat funds to the most vulnerable refugees. It is a dedicated non-interest-bearing account in Switzerland. Due to generous contributions from donors across the globe, the fund surpassed the fundraising target of $26 million originally set for 2019. The largest three destination countries comprise Yemen ($13.5 million); Jordan ($0.7 million), and Lebanon ($0.6 million). The remainder of the funds are mostly assigned to help some 670,000 Rohingya refugees in Bangladesh and distribution is in progress.

Noor Bank collaborates with Unionpay international to launch EMVCo QR-based mobile payment solution

Noor Bank has partnered with UnionPay International to inaugurate the bank’s EMVCo QR-based mobile payment service that allows consumers in the UAE to make instant and secure payments on the go. Customers and merchants across the country can now leverage UnionPay QR code scanning for all their payments. The launch ceremony was attended by Han Wang, General Manager-Middle East of UnionPay International, and John Iossifidis, CEO of Noor Bank. In the UAE, UnionPay is accepted nationwide both on POS terminals and ATM machines, acceptance rate is 100% and more than 60% on POS terminals for the UnionPay card and QuickPass. The new solution is expected to create wider acceptance and increase the number of current QR-code-enabled merchants in the country by end-2019.

Kuwait Finance House launches open banking

Kuwait Finance House-Bahrain (KFH-Bahrain) has announced going live with advanced open banking infrastructure, which will allow it to partner with innovative fintech firms. The kingdom is one of the earliest global adopters of mandatory open banking, putting it at the vanguard of customer-driven change in financial services. KFH-Bahrain is one of the first banks to integrate a fintech through the launch of its KFH Jazeel banking platform in partnership with Tarabut Gateway, a subsidiary of Almoayed Technologies. According to KFH-Bahrain executive manager Mohammed Fahmi Hamad, open banking will allow bank account holders to consent to sharing details of their accounts and payments history to licensed third-party providers to make more aware financial decisions. In addition to that, customers will soon be able to link their accounts to independent licensed applications.

INTERVIEW: Major Gulf sovereign wealth funds gear up for ESG investing

Four Gulf countries are laying the groundwork to be aligned to Environmental, Social, and Governance (ESG) standards through their sovereign wealth funds’ undertakings. Abu Dhabi Investment Authority (ADIA), Kuwait Investment Authority (KIA), Qatar Investment Authority (QIA), and Saudi Arabia’s Public Investment Fund (PIF) are among founding members of 'One Planet Sovereign Wealth Funds'. The aim is to accelerate integration of financial risks and opportunities related to climate change in the management of long-term asset. A recent Moody’s report said that ESG risks are becoming more significant as regulatory policies, market developments and social attitudes change rapidly, putting the banks under growing pressure to integrate ESG considerations into their investment decisions.

UAE lender ADCB plans to cut 2,000 jobs post-merger: Bloomberg

Abu Dhabi Commercial Bank (ADCB) is planning to slash about 2,000 jobs in the near future. In May ADCB, Union National Bank (UNB), and Al Hilal Bank merged to create the UAE’s third largest bank with 423 billion dirhams ($115 billion) in assets. Before the merger, the three banks employed about 8,500 people. ADCB started laying off employees once it began the merger with the two other banks. While the new entity retained the name ADCB, UNB was delisted and dissolved as a legal entity. Meanwhile, Al Hilal Bank retains its existing identity and continues to operate as a separate Islamic bank within the ADCB Group.

Sharjah Islamic Bank raises $500mln #sukuk

Sharjah Islamic Bank (SIB) raised $500 million in its debut Additional Tier 1 (AT1) sukuk at the lowest price of 5%. Accordingly, the bank’s AT1 Sukuk yield is the lowest in the region, down from 5.25% in 2015. The lender has received orders of $4.8 billion or 9.5x oversubscription from many investors, as well as nearly 209 individual orders from Asia, GCC, and Europe. SIB has appointed Citi, HSBC, and Standard Chartered Bank as joint global coordinators. It also hired Joint Structuring Agents along with Abu Dhabi Islamic Bank, Bank ABC, Citi, Deutsche Bank, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, KFH Capital, and Standard Chartered Bank as the joint lead managers and joint bookrunners. The sukuk is a Non Call 6 years Perpetual Instrument which will reset to 6 years Treasuries in 2025.

Saudi Arabian issuers boost #sukuk in first five months of 2019

According to S&P Global Ratings, the sukuk market enjoyed a strong start to the year but it may not last. S&P Global Ratings Head of Islamic Finance, Mohamed Damak said high levels of liquidity in Indonesia, Turkey's efforts to tap all available financing sources, and the return of Qatari and Saudi Arabian issuers to the market have boosted issuance of sukuk 17.6% in the first five months of 2019. S&P expects the total Sukuk issuance will average $105 billion-$115 billion this year, assuming the Brent oil price stabilizes at $55 per barrel. This follows a mild performance in 2018 when issuance dropped to $114.8 billion, a 5% decline compared with 2017; US dollar Sukuk alone fell by 15% year on year. Tightening liquidity conditions, high geopolitical risks in the Middle East, and challenges inherent to sukuk issuance will likely dampen sukuk market performance in 2019.

Dubai developer The First Group to issue $135mln #sukuk

Dubai-based real estate developer The First Group plans to issue $135 million in sukuk. The developer has appointed investment bank Shuaa Capital to arrange the planned transaction. The First Group specialises in hotel investments. It has completed 11 projects in the UAE to date and has seven hospitality developments under construction. This issuance is one of few debt issues in the pipeline in the Gulf region after business slowed sharply during the holy month of Ramadan, which ended last week.

IFSB database disseminates data for Islamic Banking Systems in 22 countries

The Islamic Financial Services Board (IFSB) has published country-level data on financial soundness and growth of the Islamic banking systems for Q3 and Q4 of 2018 from 22 IFSB member jurisdictions. A special feature of this publication is the inclusion of full-fledged Islamic banking data of Kazakhstan for the first time as Kazakhstan joined the database project in January 2019. The total assets of the Islamic banking industry stand to USD 1,754 billion in 2018Q4 from USD 1,684 billion in 2017Q4. Financing by Islamic banks from the participating jurisdictions reached USD 1,052 billion in 2018Q4 from USD 1,024 billion in 2017Q4. The IFSB Task Force has been greatly facilitating the collection of Islamic banking data. The database is available at the IFSB website https://psifi.ifsb.org.

IFSB issues working paper on risk-sharing in Islamic Banking

The Islamic Financial Services Board (IFSB) issued its 10th research (WP-10) in the IFSB Working Paper series which explores the risk-sharing practices in the Islamic banking sector. It describes the views of both Islamic banks and regulatory and supervisory authorities (RSAs) on the practices of Islamic banks in IFSB member jurisdictions. This is in relation to the governance rights of unrestricted profit-sharing investment account (UPSIA) holders. The findings in WP-10 reveal that the capital treatment of the UPSIA in general varies across different jurisdictions and Islamic banking type. In most of the jurisdictions UPSIAs are considered to be 'investments' exposed to losses rather than 'deposits' with capital certainty.

#Kuwait International Bank starts marketing $300mln #sukuk

Kuwait International Bank started marketing $300 million perpetual sukuk to boost its tier 1 capital, with a yield of around 6.25%. Perpetual bonds mimic some of the characteristics of equity because they lack a maturity date. Citigroup, Dubai Islamic Bank, First Abu Dhabi Bank, KAMCO Investment Co, KFH Capital Investment Company, and Standard Chartered Bank have been hired to lead the transaction.

Abu Dhabi bank delays instalments on personal financing in Ramadan

Abu Dhabi Islamic Bank (ADIB) revealed it would postpone a monthly instalment for its personal finance customers at no extra charge during the holy month of Ramadan. ADIB annually offers flexible payment to customers during Ramadan to meet their individual needs. Philip King, global head of Retail at ADIB, noted that customers eligible for the Ramadan payment postponement initiative would be informed by SMS, adding that the offer is valid for instalments due between 1 May and 31 May. However, customers are free whether to withdraw or maintain making instalment payments. Throughout the holy month, ADIB hosts Ramadan tents across the UAE that organise Iftars managed by the bank’s employees who have volunteered to be part of the initiative.

Global #sukuk market to hit $2.7trln by 2030: Franklin Templeton

According to investment management firm Franklin Templeton, the global sukuk market is set to grow at a compound annual rate of around 15% to reach $2.7 trillion by 2030. Global sukuk issuance stood at over $477 billion at the end of last year, but has slowed somewhat in recent years. Ratings agency S&P in January described sukuk issuance as 'mild' in 2018, as the total amount of sukuk issued dropped by 5% to $114.8 billion. It forecast issuance of $105 billion-$115 billion for 2019. Mohieddine Kronfol, head of fixed income at Franklin Templeton, forecasts that the growth continues at a relatively rapid pace. In GCC markets several corporate entities have been issuing debut sukuk in recent months. Saudi Telecommunications Company issued its debut $1.25 billion sukuk on Sunday, following on from Saudi food company Almarai’s first $500 million sukuk in February.

INTERVIEW: Gulf banking consolidation 'long overdue' - Investcorp's co-CEO

According to the co-chief executive of Bahrain’s Investcorp, Rishi Kapoor, consolidation in the financial services industry in the region is long overdue. Consolidation in banking would build the scale required to increase investments in financial technology, as payment solutions are increasingly enabled by fintech. The banking sector in the Gulf Arab region is seen as overcrowded, an M&A deal among banks is currently either in the pipeline or has taken place within the past few months. Investcorp’s co-chief also expects more M&A in the region’s disorganised retail sector, particularly in Saudi Arabia. As for the sectors that offer attractive investment opportunities within the Gulf region, Kapoor favours the sectors related to privatisation, social infrastructure and domestic consumption.

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