Asia

HSBC launches Amanah India Sharia Portfolio

The portfolio management services division of HSBC Asset Management has launched the actively managed, open-ended HSBC Amanah India Shariah Portfolio. The portfolio will be benchmarked against the Dow Jones Islamic Market India Index and the BSE 500.

CEO of HSBC Asset Management is Mr Vikramaaditya.

Islamic Bank of Asia in Singapore Sukuk job

CPIFinancial reported on 20 January that the Islamic Bank of Asia is one of the two Lead arranger for SGD 200 mn Sukuk Al-Ijarah Trust Certificate Issuance Programme from Monetary Authority of Singapore. The bank itself will be the first investor in the programme.

Vince Cook is the CEO of The Islamic Bank of Asia.

Singapore plans S$ 200 mn Sukuk programme

Saeed Azhar, Reuters reported on 19 January that Singapore's central bank aims a S$200 million Sukuk Al Ijara programme, to promote the growth of Islamic finance in the state. The underlying asset for this Sukuk programme is the office units of Monetary Authority of Singapore's head office. According to Heng Swee Keat, managing director of the Monetary Authority of Singapore the Sukuk will be the Sharia compliant equivalent of Singapore government securities with the same credit standing.

South Korea interested in Islamic finance

The Financial Supervisory Service (FSS) Governor Kim Jong-chang sees Islamic finance as a potential new alternative in overcoming the global financial crisis pointing out that reckless distribution of complicated derivative products throughout the global market, detached from the real economy, put the global financial market into crisis.

The annual seminar, held in Japan and Hong Kong in the last two years, is now under way in Seoul, jointly hosted by the Islamic Financial Services Board (IFSB), the Financial Services Commission (FSC) and the FSS.

Kim said the regulator would focus on setting up infrastructure for Islamic finance in the country.

Malaysia Bina Puri unit gets Islamic financing

A unit of Malaysian builder Bina Puri Holdings Bhd has secured RM 1.04 bn of Islamic financing to build a highway, Reuters citing Bernana, the official news agency.

Singapore's Agni Inc plans sukuk deals

Singapore renewable energy firm Agni Inc will sell more than RM 900 mn Sukuk Al Ijara according to a Malaysian newspaper.

HLTM Takaful launches capital protection investment-linked scheme

HLTM Takaful launches capital protection investment-linked scheme called The Alpha Crescent Investment Plan, which is a 3-year 100% capital protected plan. It is based on the concept of murabahah and wa’ad where the potential investment returns at maturity were referenced against the performance of the Alpha Crescent Index.

HLTM Takaful, which is managing the plan, said it would be distributed by Hong Leong Bank Bhd.

HLTM Takaful chief executive officer is Ab Latiff Abu Bakar.

Sukuk Issuance Fell Dramatically In 2008 But Long-Term Market Prospects Are Good, Says S&P

Press Release

PARIS, January 14, 2009--Despite a dramatic decline in volumes in 2008, the long-term perspectives for global sukuk issuance are still good, said Standard & Poor's Ratings Services in a report published today "Sukuk Market Declined Sharply In 2008, But Long-Term Prospects Remain Strong."

"The decline in sukuk issuance in 2008 was as a result of global market turmoil, drying up of liquidity, widening of credit spreads, and investors' wait-and-see attitude," said Standard & Poor's credit analyst Mohamed Damak. "Although difficult to measure, part of this decline could also have been due to comments about the Sharia compliance of some sukuk by the Accounting and Auditing Organization for Islamic Financial Institutions.

More than 45% of sukuk issued in 2008 were "ijara" (lease financing), most probably as a direct consequence of the debate about Sharia compliance among some scholars. The value of sukuk issued in 2008 dropped by more than 56% compared with 2007, to $14.9 billion. "We do not expect the market to start reviving before the second half of 2009 or early 2010," added Mr. Damak.

Indonesia to issue retail sukuk in February

Reuters reported on 7 January that Indonesia's finance ministry plans to issue Sukuk for retail investors in February to help finance the state budget said Rahmat Waluyanto, treasury director general at the finance ministry. The yield shall be announced on 5 February and be offered till 20 February, listing on the bourse follows on 26 February.

Crisis offsets Islamic wealth management 2008 gain

Guardian reported based on Reuters on 7 January that market volatility wiped out all of the asset gains made by the Islamic fund management industry in the year to September 2008, citing US-based research and data provider Cerulli Associates. Sharia-compliant fund managers had assets of USD 65 bn at the end of the 3rd quarter 2008, including assets managed via discretionary mandates for institutions and high net-worth individuals and mutual funds. Assets invested in Islamic-compliant mutual funds rose by 50 % while the number of such funds doubled in the three years to 2008. Islamic mutual funds alone accounted for USD 35 bn-- up from USD 23.2 bn gathered in 2005. Sukuk funds remained a rare offering. Once markets stabilise this industry can potentially expand at a rate of above 10 % a year, the report said. Saudi Arabia is currently the largest domestic market for shariah investments. Challenges named in a poll by Cerulli were named the Sharia compliance costs, convincing investors of the Sharia compliance, the discrepancy in Sharia standards and the lack of 3rd party distribution.

Report order form: http://www.cerulli.com/pdfs/2008_Shariah_Info_Packet.pdf

Brunei sells 148 mn in local currency short term Sukuk

Reuters reported on 6th January that Brunei has sold Brunei Dollar 148 million (USD 100.7 mn) of short-term Sukuk, it sold the bonds in four different issuances, with maturity periods ranging from 91 days to 364 days.
This brings total government issuance to Brunei Dollar 1.3 bn to date. Brunei government has been issuing Islamic debt since April 2006.

Indonesia to issue global bonds in 2009

Reuters reported on 31 December that Indonesia plans to issue international bonds, and Sukuk. Timing is not scheduled yet. Treasury Director General Rahmat Waluyanto was quoted.

More background: http://in.reuters.com/article/asiaCompanyAndMarkets/idINJAK38567320081231

Reuters: Japan investors interested in Islamic products

Reuters reported on 30 December that Japanese investors have expressed interest in developing Islamic capital market products, according to a local newspaper quoting Aseambankers Chief Executive Officer Mohammed Rashdan Mohammed Yusof. No company names were disclosed in the interview, however Aseambankers, the investment bankers of Maybank Group plans to develop the Sukuk market in Japan.

Japan moves carefully toward Islamic finance

Manabu Hara reported on 12 December in Asahi Newspaper that the Japanese Government has taking a step more to introduce Islamic finance. Earlier this month, the Financial Services Agency (FSA) amended financial regulations to let bank subsidiaries handle Islamic finance operations. But still Murabaha transactions are subject to tax issues.

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Polaris Investment Trust Plans to Issue Taiwan Islam ETF

Philip Liu CENS.com reported on 2 April that it plans to roll out Islam ETF in the second quarter this year.

The firm is also in talks with Morgan Stanley Capital International (MSCI) for licensing of its Taiwan Islam Index for use in issuing the Islam ETF in Abu Dhabi. The MSCI Taiwan Islam Index consists of 60 constituent stocks, selected from the over 120 constituent stocks of MSCI Taiwan Stock Index, whose operations conforms to the tenets of Islam.

Liu Tsung-sheng is president of Polaris Investment Trust.

Source: http://news.cens.com/cens/html/en/news/news_inner_22868.html

USD 158 mn AirAsia sukuk issue approved

Trade Arabia reported on 28 April that the RM 500 mn Sukuk issues is approved by the market regulator.

Bank Islam Malaysia and Kuwait Finance House (Malaysia) are the joint principal advisers, lead arrangers and lead managers for the issue.

Kuwait Finance House shall be the guarantor for the sukuk programme. Malaysian Rating Corp has assigned a long-term rating of AA+(bg) for the issue.

Source: http://www.tradearabia.com/news/newsdetails.asp?Sn=CM&artid=142568

Banks appointed for Pakistani Sukuk

The Guardian reported on 25 April that Pakistan appointed advisers for first domestic Sukuk, being Dubai Islamic Bank and Standard Chartered Bank Pakistan as Managers. The estimated size of the Sukuk might be 20 bn Pakistani rupees.

Ashfaque Hasan Khan is special secretary at the Finance Ministry.

Source: http://www.guardian.co.uk/feedarticle?id=7484821

CIMB to expand Islamic banking in Middle East

The Star Malaysia reported on 22 April that CIMB group intends to expand its Islamic banking business in Dubai and Saudi Arabia via acquisitions.

The group via Bumiputra-Commerce Holdings Bhd recently acquired a 19.99% stake in China-based Bank of Yingkou Co Ltd.

CIMB group chief executive is Datuk Nazir Razak.

Source: http://biz.thestar.com.my/services/printerfriendly.asp?file=/2008/4/22/b...

Takaful Ikhlas Targets RM 70 mn in premium from its government housing loan

Mahanum Abdul Aziz reported on 19 April on Bernama that Takaful Ikhlas Targets RM 70 mn in premium from its government housing loan scheme.

Syed Moheeb Syed Kamarulzaman is president and chief executive officer.

Source: http://www.bernama.com.my/bernama/state_news/news.php?id=327888&cat=st

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