Europe

London judge postpones decision on Dana Gas #sukuk hearing

A London High Court judge will decide on Friday whether to continue proceedings on the validity of $700 million sukuk issued by Dana Gas. United Arab Emirates producer Dana Gas started proceedings in June to have its sukuk declared invalid and unlawful because of changes in the interpretation of Islamic finance. A last-minute injunction obtained by some shareholders prevented Dana Gas from participating in the trial. High Court judge George Leggatt on Tuesday adjourned the trial and decided to reserve judgement until Friday. The outcome of the trial could have significant repercussions for sukuk issuers and investors worldwide, as it could set a precedent for other issuers. The case is being disputed in UK and UAE courts because while the purchase undertaking is regulated by English law, the mudarabah agreement underlying the sukuk structure is regulated by UAE law.

#Brexit suspense casts shadow over #UK as an Islamic finance hub

Uncertainty over the UK’s future status as a financial hub after leaving the European Union (EU) is already casting a shadow over London’s Islamic finance sector. It is estimated that London would lose at least 10,000 banking jobs and 20,000 roles in financial services as clients move €1.8tn of assets out of the UK. The banking exodus would also hit the Islamic finance sector in London, which is the largest globally in a non-Muslim jurisdiction. London currently hosts more than 15 large banks that operate Islamic finance windows and dozens of related service providers. A banking lobbying group has already urged the UK government to introduce post-Brexit laws that make sure that demand for Islamic finance services does not diminish. As long as the UK gives no clear direction whether and how it would excel as a financial hub, competitors will continue positioning themselves as alternative locations. Within the EU, Luxembourg and Dublin, and partly Frankfurt, have good chances to take on roles as Islamic finance hubs for Islamic finance institutions with business in the EU.

QInvest invests in #Spanish #marina OneOcean Port Vell

#Qatar's QInvest has invested in OneOcean Port Vell in Barcelona, Spain. Originally built for the 1992 Olympic Games, the marina recently completed its transformation to a luxury facility, creating the ultimate destination for yachts up to 190m. QInvest will work with the city and port authorities in Barcelona to increase the profile of the marina by investing additional resources in the port infrastructure. OneOcean Port Vell is QInvest's second investment in Spain this year, having earlier invested into a Spanish real estate strategy focused on land developments in Madrid, Barcelona, Valencia and Marbella. The objective is to acquire well-located land parcels across Spain and develop residential apartments for first home owners. QInvest’s revenues from all business lines were QR209mn, resulting in an operating profit of QR113mn and net profit of QR34.6mn in the first half of this year. The bank’s global assets stood at QR4.7bn at the end of June 30, 2017.

#Turkish participation banks' #profit #soars 36 pct in first half

The Participation banks achieved a profit of approx. $223.29 million in the first half of 2017 with an increase of 36 % compared to the same period the year before. According to information put together by the non-consolidated financial statements of Albaraka Türk, Kuveyt Türk, Türkiye Finans Participation Bank, Vak?f Participation and Ziraat Participation, the total assets of participation banks increased by 7.7 % compared to the end of last year, exceeding $41.52 billion. In the first half, the net profit of the sector increased by 36 %.
Among the participation banks, Kuveyt Türk achieved the highest net profit in the first half, followed by Türkiye Finans Participation Bank, Albaraka Türk, Ziraat Participation and Vak?f Participation. By the end of June, Kuveyt Türk was the leader of the sector, followed by Türkiye Finans Participation Bank and Albaraka Turk.
Speaking to Anadolu Agency regarding the first half results and expectations of the participation banks, Melik?ah Utku, chairman of the Participation Banks' Association of Turkey (PBAT), stressed that the participation banking sector is in a significant development process and has serious potential in Turkey.

The #continuing allure of #Islamic #finance

The total Islamic finance industry was estimated at around $ 1.9 trillion in assets for the year end of 2016, and it pales into insignificance compared with traditional finance. However of special interest is the growing popularity of Islamic finance from both the Muslim and non-Muslim financial institutions and investors. Islamic assets are very much concentrated in the banking sector which holds $1.5 trillion in total, with the Islamic bonds or sukuks worth $320 billion, and investment funds and insurance or so called takaful worth $56 billion and $25 billion respectively.
The majority are purchase and sale or murabaha and leasing or ijara transactions. Some major Gulf companies are turning to the sukuk market to raise funds, with Saudi Aramco and the Government of Saudi Arabia both successfully launching sukuk tranches which were heavily oversubscribed.

#Master in Islamic Finance

The Islamic Corporation for the Development of the Private Sector (ICD) in collaboration with IE Business School offers a training program for the development of executives across the Islamic finance industry. The Master in Islamic Finance program has a blended format, combining on-site periods in Spain and Saudi Arabia with dynamic, interactive online modules to minimize the time away from work. The length of the training is 13 months and intake starts in October 2017. Throughout the program, participants will obtain practical knowledge of high-level financial tools, develop practical Islamic Finance technical skills and acquire leadership skills. Upon program completion participants receive a University Private Degree from IE Business School and IE Universidad. IE Business School is a school within IE Universidad, which is a University officially accredited by the Spanish education authorities.

Islamic #FinTech Strengthens Ties with European Partners

Abu Dhabi Global Market (ADGM) has announced two new partnerships with non-profit organizations from London and Zurich. The first alliance is with the Swiss Finance and Technology Association (SFTA). The second one is the British think tank Responsible Finance and Investment Foundation (RFI). The Swiss partnership will strengthen the collaboration between local FinTech businesses and will provide new opportunities for knowledge transfer. ADGM also signed an agreement with the London-based RFI. Both parties will work together to assist young FinTech entrepreneurs in testing and introducing innovative products under the ADGM Reglab program. In addition to that, RFI and ADGM will also set up an open platform to share knowledge and expertise. According to Blake Goud, the CEO of RFI, FinTech can have a leading role in transforming the way Islamic institutions connect with their clients. In his view, this partnership can encourage and support emerging FinTech companies to adopt ethical, responsible and Islamic approaches.

#IIRA Maintains #Ratings of #Kuveyt #Turk Participation Bank

The ratings on Kuveyt Turk Participation Bank continue to reflect its overall sound risk profile. IIRA’s assessment on Kuveyt Turk Participation Bank encompasses sponsor support from its key shareholders that include Kuwait Finance House, Islamic Development Bank and other quasi-sovereign entities such as the General Directorate of Foundations – Turkey and Kuwait Public Institution for Social Security.

#Dana #Gas takes offer to #creditors off the table in $700m #sukuk row

Dana Gas has withdrawn an offer to creditors to exchange its debt of $ 700 million Islamic bond for new notes. Thereby ending the chance of a consensual resolution to a case that could shape the future of the global Islamic finance industry. The gas company is refusing to repay holders of its Islamic bond which matures in October. It said last month it had received legal advice that the bond was no longer Sharia-compliant in the UAE because of changes in Islamic finance interpretations over the recent years, and was therefore not lawful. But creditors say Dana has to pay them back and argue if the sukuk was legal when the deal was struck, it holds, and if it was illegal then it would mean the company is in default.

#Abu #Dhabi #Islamic #Bank praises #UAE #Central #Bank clampdown on mis-selling #investments

Central Bank issued a notificaiton in May this year about mis-selling of investments. The UAE‘s largest Sharia-compliant lender, Abu Dhabi Islamic Bank, has welcomed efforts by the central bank to clamp down on unscrupulous sales of investment plans to UAE expats It said, the reputation of the industry as a whole had been damaged by dishonest brokers.
“More regulation is a good thing and we work very closely with the central bank” and other wealth management institutions who wish to improve their services, said Daffer Luqman of Abu Dhabi Islamic Bank. “At the end of the day the reputation of the business affects everybody. If an institution does a bad job of promoting or marketing a service it affects the whole industry so it’s very important that this business is regulated, that it’s regulated effectively and that everybody plays by the rules.”

Gatehouse Bank appoints ex-Shawbrook director

Gatehouse Bank has appointed former Shawbrook Bank director Tim Blease as its new chief operating officer (COO). Tim Blease’s previous roles include new business strategy and innovation director at Shawbrook and head of retail credit risk at Metro Bank. The bank has also appointed Sharron Harvey as its executive vice-president head of HR. Sharron has previously worked for Habib Bank Zurich and has 20 years of HR experience, mainly in the financial sector. Both Tim and Sharron will report to Charles Haresnape, CEO of Gatehouse Bank. The appointments come after Gatehouse revealed a number of changes to its board last week.

Bosna Bank International, Una-Sana Canton sign deal to back business

The government of Bosnia's Una-Sana Canton said it has signed a deal with Bosna Bank International (BBI) to fund business entities in the area. Under the deal BBI will provide financing to businesses in the canton under favourable conditions at a subsidized rate of 2.3%. BBI has secured 12.49 million marka ($7.4 million/6.4 million euro) for the project. The maximum amount that can be approved per business is 1 million marka, with a repayment period of three to seven years depending on the size of the loan.

The future of Islamic finance in #Spain

In Spain the Muslim population exceeds two million being higher than that of Qatar or Bahrain and similar to the population of Kuwait. However, there are no Shari'ah compliant services or assets under management. Europe advances in this type of financing. The United Kingdom was the first non-Muslim country that held in 2014 an emission of sovereign Sukuk bonds amounting to 200 million pounds. In 2015 Kuwait Finance House (KFH) opened a subsidiary in Germany, Habib Bank Zurich will operate in the UK at the end of 2017. There is a clear tendency that Islamic banks are expanding their activities in Western countries and continue introducing their products in these markets. In Spain there is an excellent opportunity to implement Islamic finance as currently there is no market operator offering Shari'ah compliant products or services.

Le combat de la ville de Nice contre une enseigne de «finance islamique»

Alors qu'une société souhaitait installer des enseignes lumineuses avec la mention "finance islamique", le tribunal administratif de Nice a validé le refus de la mairie. Un nouveau dossier communautaire à gérer pour la ville, un an après l'affaire des burkinis. Le dossier pourrait raviver les tensions. Le tribunal administratif de Nice a débouté aujourd'hui jeudi 6 juillet la société Noorassur de sa requête contre la mairie de Nice, et a validé le refus par la mairie que la société appose deux enseignes lumineuses. Le juge a estimé que la décision de la mairie ne pouvait être regardée comme portant atteinte. Dans un communiqué, Christian Estrosi s'est félicité de la décision du tribunal. Du côté de la société Noorassur, l'ordonnance rendue en référé ne clôt pas l'affaire.

London court to hear Dana Gas #sukuk case in September

London's High Court plans to hold a full hearing in September on efforts by Abu Dhabi-listed Dana Gas to restructure $700 million of its outstanding sukuk. Dana Gas declared the bonds invalid last month, saying they were no longer compliant with changing interpretations of the Sharia law. The judge upheld an interim High Court injunction blocking holders of the bonds from enforcing claims related to the securities against Dana Gas. However, he imposed restrictions on asset sales by Dana and its ability to raise more debt or pay dividends. The case has worried the Islamic finance industry as it has raised the prospect that other firms could justify not honouring obligations by claiming sharia-based financial standards had changed.

Market-leading Sharia #savings #accounts: should you consider them?

A number of Sharia savings products are beating competitors and are playing their part in kick-starting small rate increases. Currently in the fixed bond market, Sharia savings accounts top every single category. As well as top returns, they also appeal to the more ethical saver or investor as the money is invested, not lent out. According to James Blower, managing director of Savings Guru, Sharia-compliant savings have developed their niche very well and will grow in popularity. He says there are three reasons why Al Rayan is one of the most successful Islamic banks in the UK. It has a low minimum entry level, wide range of options for customers to deal with it and it rebranded from Islamic Bank of Britain to Al Rayan Bank. An interesting point to note is that 86% of Al Rayan customers are non-Muslim. In the UK Al Rayan, BLME and Milestone are all regulated by the Financial Conduct Authority (FCA) and are members of the Financial Services Compensation Scheme (FSCS) which protects deposits of up to £85,000.

Why London Will Remain The Islamic Finance Hub Of The West

London’s popularity as an Islamic finance hub emerged in 2013, when Prime Minister David Cameron unveiled plans to develop the city into the Western capital of Islamic finance. In 2014, London took a step further when Britain became the first country outside the Islamic world to issue sovereign Sukuk. The key benefit of this policy was attracting additional liquidity from investors in the Middle East and Asia adhering to Islamic finance principles. The London Stock Exchange is a key global venue for the issuance of Sukuk. According to the LSE Group official website, over $48bn has been raised through 65 issuances. Other centres such as Dublin and Luxembourg also have ambitions to attract Islamic financial services. Furthermore, in April this year Saudi Arabia listed its biggest ever sharia-compliant bond on the Irish Stock Exchange, so the competition between the Western financial centres is more intense than ever.

Gassner's picture

Bitcoin Mania versus Tulip Mania?

Dear Reader,

regular readers may remember my critic on bitcoin from an Islamic perspective missing intrinsic value. The former blog entry you find here: http://www.islamicfinance.de/?q=node/7840 - almost two years ago.

So far bitcoin just went up higher and higher, with wild fluctuations but nevertheless.

It reminds on how bubbles work, think about the tulip mania in 1637 a nice piece of economic history. A single tulip bulb was traded and bought on credit. Check the Wiki page on it:

https://en.wikipedia.org/wiki/Tulip_mania

As bitcoin has even less value than a tulip except for payment purposes, it is the payment functionality, which can lead to destruction. What happens if a new alternative currency is becoming en vogue, which has a better usability and faster transaction time? In my view this is most likely trigger to burst the bubble.

FT Alphaville covers now the difficulties coming up with bitcoin's increasing transaction numbers causing inconvenience in using the digital currency:

https://ftalphaville.ft.com/2017/05/17/2188961/the-currency-of-the-futur...

#UK slowly progressing towards providing Shariah compliant #student #finance

The UK Government has been thinking about the possibility of introducing Shariah compliant student finance since 2011. The Higher Education and Research Bill is currently before Parliament. However, the Bill contains no time-scale for when a Shariah compliant system is likely to be in place. When the Bill was reviewed in the House of Lords, Lord Sharkey proposed an amendment to give a deadline of the 2018-2019 academic year for the introduction of such a scheme. This proposal was rejected by the Government. Lord Sharkey instead proposed an amendment requiring quarterly progress reports from the Secretary of State. The final outcome is that the Bill will proceed forwards and once it has completed all stages, the Secretary of State for Education will have the power to implement a Shariah compliant student finance system.

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