A statement from the deposit insurance fund (DIF) that Islamic lender Bank Asya would either be sold or liquidated by the end of May has no legal basis and its shareholders will never agree to such forced maneuvers, Süleyman Ta?ba?, a lawyer for Bank Asya shareholders said. Selling the bank is not legally possible according to banking law, he explained, adding that the bank's equity capital ratio is still strong; it has TL 1.35 billion in equities and another TL 1.4 billion deposited with the central bank. Plus, the shareholders still hold ownership. Ta?ba? criticized DIF's irresponsible statements, adding that all parties should respect the judicial process that is currently under way with regards to the bank's future.
The European Bank for Reconstruction and Development (EBRD) has announced it is co-financing the development of a 318 million-euro high-tech hospital in Konya, a city in Turkey’s central Anatolian region. As part of a comprehensive long-term financial package, the EBRD has arranged a 147.5-million-euro-of syndicated loan under its A/B loan structure, with 67.5 million euros for the Bank’s own account and 80 million euros of syndicated to UniCredit Bank Austria AG and Siemens Financial Services. The Black Sea Trade and Development Bank and the Islamic Development Bank are providing parallel financing of 50 million euros and 67.5 million euros respectively.
Adnan Ahmed Yousif, the head of Al Baraka Banking Group, said Turkey, and especially Istanbul, had the potential to become a hub for financial services. Yousif, who is the president and CEO of the Bahrain-based group, said Turkish economic administrators were aiming to broaden the services offered to customers, with special focus on participation banks. He also said Turkey's huge potential might facilitate the interest of investors from the Gulf countries as well as create new opportunities for the recently expanding sukuk market in Turkey.Turkey and especially Istanbul, is very close to participation banking markets, such as the GCC and Europe.
Euris Group wants to develop Islamic Finance in Europe. The firm designed a banking concept and is now promoting its project, a Shari'ah compliant private bank in Luxembourg. The European market remains fragmented and far from comprehensive. To fill the gap, it's necessary to build a pure player, i.e. a fully fledged Islamic bank in the Eurozone. From there, a lot will remain to be done: entering the retail and commercial banking space, providing Takaful solutions to European customers and exploring the relevant investment banking opportunities, especially when it comes to European Sukuk. Euris Group chose Luxembourg because it occupies a central position at the heart of the Eurozone.
A new Bank of England consultation, which closes on 29 April, builds on a feasibility study carried out last year and sets out two possible deposit facilities, and two possible liquidity insurance models. The idea behind the proposals is to help firms that are prevented by Shari’a law from undertaking activities involving interest to manage fluctuating liquidity demands and ride out periods of particular stress. Although the consultation sets out options for both Shari’a compliant deposit facilities and liquidity insurance, the Bank of England said that it was prioritising the former as the area of greatest demand. Following the consultation and further analysis, it will decide whether any of the proposals are feasible, it said.
There are a growing number of transactions in the Turkish market that are financed by GCC institutions; and the Gulf States are steadily rising investors in Turkey. Among the lastest crop of deals, Qatar’s QInvest has provided a five year $30m murabaha mezzanine finance facility for Turkish private equity firm Crescent Capital to fund its acquisition of a 100% stake in Akocak HPP, an operational 81 MW hydro-electric power plant in Turkey. QInvest has structured and invested in the transaction. The deal also shows that traditional project finance structures are giving way to alternative financing structures, with Islamic finance showing potential for further growth in the funding of capital goods projects.
Since reaching the nuclear agreement that lifted economic sanctions on Iran, President Barack Obama has pledged to continue to punish foreign companies that do business with the regime’s powerful Islamic Revolutionary Guards Corps. In theory, this will chill European investment in Iran because the IRGC, along with its front businesses, controls major portions of Iran’s economy in vital sectors such as oil, construction and banking. But despite recent reports of billions of dollars worth of new European investment in Iran, the US Treasury Department has seen no evidence that European companies are conducting transactions with the IRGC. Many sanctions experts question whether this is really possible.
Ashraf Piranie, deputy chief executive and finance director at The Nottingham, has received an accolade for his contribution to finance and banking at the British Muslim Awards. Mr Piranie joined the board of The Nottingham in 2007 and was previously the finance director and joint managing director at the Islamic Bank of Britain and director of finance at Alliance & Leicester Plc. One of his most notable achievements was the proactive part he played in introducing Islamic finance legislation to the UK's Finance Acts. He continues to play an important role on UK banking regulation and since 2013 has been a member of the PRA's Practitioner Panel representing the building society sector.
La chaire éthique et normes et de la finance (CENF) de l'Université Paris 1 en partenariat avec le laboratoire d'excellence sur la régulation financière (LabEx RéFi) organisent une table ronde sur "La religion dans la finance : risques, marketing et réalités" le 10 février 2016 à 18h. Cet évènement aura lieu dans la salle 1 du Centre Panthéon (12 place du Panthéon) et accueillera Frédéric Baule (consultant indépendant), Nicolas Hardy (Analyste financier, Standard & Poor´s Ratings Services) ainsi que Edouard Fernandez-Bollo (autorité de contrôle prudentiel et de résolution) et sera modérée par Pierre-Charles Pradier (Paris 1).
Kuwait Finance House Turkey (KFH-Turkey) issued Tier 2 capital-boosting sukuk worth $350 million to support its capital situation. The bank has set the yield at 7.9 percent for 10-year tenure. The sukuk will be listed on the Irish Stock Exchange for trading. The credit rating agency "Fitch" assigned an expected rating of BBB- to this tier 2 Basel III-complaint issue. The bank targets boosting its capital adequacy ratio so it can grow and enhance its presence in the international markets, said CEO- KFH -Capital Abdulaziz Nasser Al-Marzouq. KFH -Turkey mandated international banks and financial institutions led by KFH -Capital as a global coordinator, manager and syndicator, in addition to other lead managers and syndicators which are HSBC, Dubai Islamic Bank (DIB), Nour Bank, QInvest Investment Bank, Emirates NBD, and KAMCO Investment Company.
Contrary to popular opinion, Sharia law is not taking over Britain. It is seen as a rule of law that contributes to the way Muslims live. Most importantly, the principles of Islamic finance encourage fairness. The presence of the likes of Allen & Overy, Hogan Lovells and Norton Rose Fulbright shows how far Islamic finance has come. The unwavering investment that has occurred over the Middle East, with offices springing up in Saudi Arabia, Oman, Qatar, United Arab Emirates and Kuwait is a testament to firms taking the Islamic practice seriously. Trainees can develop leadership skills by undertaking research and ascertaining what works for clients.
The central London offices must be run in line with Islamic principles because of a deal with rich Middle Eastern investors. They demanded the buildings be audited by Muslim scholars and subject to special rules in exchange for lending the Government £200million. The deal currently only covers three buildings - Richmond House, Wellington House and a property on Whitehall - and is almost unheard of outside of the Middle East. But Treasury officials hope hundreds of Western companies will follow their lead and turn over buildings to Islamic financiers in similar deals. The exact restrictions under which the buildings must be run which were not spelled out in the text of the deal struck with overseas investors.
Kuwait Finance House (KFH) will set up a sharia-compliant asset management unit under its Turkish bank branch, the lender said on Monday. Kuwait Finance House Turk will establish five sharia-compliant investment funds and offer other investment services under KT Portfoy, the new unit, KFH said in a bourse statement. The establishment of the new firm is conditional on approval from Turkey's capital market authority. KFH's chief executive in January said it would issue Islamic bonds to boost capital reserves at its subsidiary bank in Turkey, even as it looks to restructure its global assets.
As Italy's demand for mini-bonds grows, Nctm Studio Legale (Nctm), a law firm, has hired Shariyah Review Bureau (SRB) to help it structure an Islamic Bond. Under the agreement, SRB will collaborate with Nctm to help structure and certify the mini-bonds in light of Sharia guidelines. Shariyah Review Bureau team has many years of experience in a range of industries, specializing in Investment Funds, banking, insurance, agriculture, and Asset Management. The demand for their services has quadrupled over the years with 2015 being the most eventful year. SRB expects this Islamic bond to open new venues of connecting capital with businesses in Italy and also help provide new opportunities to the SME sector.
The Malta Stock Exchange (MSE) will launch on Monday an Islamic equity index aiming to attract business from Middle East firms, a move it hopes will also prompt the government to issue Islamic bonds. The launch of an Islamic index, developed alongside Dubai-based sharia advisory firm Dar al Sharia, and a debut sovereign sukuk would mirror steps taken by Britain and Luxembourg to develop their own credentials in the sector. In 2011, Malta's financial regulator issued a guidance note on Islamic investment funds, the first EU member country to do so, although no such funds have been listed yet. The exchange is also launching this month a new capital market for small and medium-sized firms.
Ratings agencies in the European Union, which came under fire during the financial crisis for the verdicts they gave on sub-prime debt, still need to be better supervised, the bloc's auditor said on Monday. The European Court of Auditors said that the European Securities and Markets Authority's supervision of the agencies since 2011 was well established, but not fully effective. Cumbersome registration rules and central bank hurdles are making it harder for smaller credit ratings agencies to compete with the "Big Three" in the EU, the report concluded. Ratings agencies came under the gun during the 2007-09 financial crisis.
Bahrain-based Ibdar Bank has announced that it has made a £8 million investment in a prime new residential project. Angel Gardens, consisting of residential 458-apartments and a total development value of £124 million, forms part of the wider NOMA re-development project aimed at transforming Manchester city centre. The development is being funded through a combination of equity invested by Ibdar and other co-investors and senior debt to be obtained from one of the Banks. Forecasts indicate an expected income return through operations starting at 9.1% on stabilized income, rising to 10.8% per annum after three years of stabilised operations and a targeted IRR of +15% over a five year investment period.
Bahrain's Al Baraka Islamic Bank plans to open a sharia-compliant bank in France next year as the lender seeks to expand into Europe, Chief Executive Adnan Ahmed Yousif said on Sunday. France has one of the largest Muslim populations in Europe but cultural and legal obstacles have impeded the development of its Islamic finance industry. Some Gulf-based Islamic banks that have expanded in Europe have gone elsewhere. Qatar's Masraf Al Rayan owns Al Rayan Bank in the United Kingdom, while Kuwait Finance House's Turkish arm opened its first branch in Germany last year. Al Baraka also plans to acquire a bank in Indonesia either this year or in 2017 and was in talks with the Indonesian central bank governor, Yousif said.
Fixed term deposit accounts, which pay an “expected profit rate” instead of interest, beat the best fixed rate bonds when it comes to earnings. HM Revenue & Customs (HMRC) confirmed that profits from Sharia accounts would count towards the personal savings allowance. Where returns are the economic equivalent of interest (and meet certain other criteria) they are taxed as if they are interest - and will be included within the definition of savings income, according to HMRC. This means Sharia compliant savers will be able to take advantage of the new £1,000 tax free interest earnings allowance if they are a basic rate taxpayer (£500 for higher rate taxpayers).
Many Iranian banks have created a roadmap to open up to the world. Bank Pasargad, the second-largest finance company of Iran with billions of dollars of blocked assets in many countries worldwide, is one of them. According to Mostafa Beheshtirooy, a member of the executive board at Bank Pasargad, the bank has started conducting research into Turkey, Germany, Spain and China, adding that business could be done via a local partner or a take-over of a bank. Beheshtirooy said that, despite the negative impacts of the rising dollar and falling oil prices, the bank's total assets will reach $70 billion; in stark contrast to the current $19 billion it holds.