Financial Institutions

Egon Zehnder executive search assigned to find new EON Bank head

Yap Leng Kuen reported in the The Star that the International search firm Egon Zehnder International has been appointed to find a replacement for former EON Bank CEO Albert Lau Yiong.

Islamic Bank of Britain launches mortgage product in Scotland

Jane Bradley reported in the Scotsman on 3 April that Islamic Bank of Britain is introducting its mortgage product to Scotland. It is understood the launch is just the beginning of a wider push into Scotland – which is likely to include the opening of a physical branch and back office operations as well as the introduction of online retail banking for Scottish customers.

Two Islamic banks in Kenya founded, but first year of operations not yet profitable

James Makau reported in Business Daily on 31 March that the Gulf African Bank and First Community Bank became the first fully fledged Islamic banks in Kenya but both had to record losses in their first year of operations as operating expenses and heavy set-up costs took a heavy toll on earnings.

Gulf African Bank recorded a loss of Sh281 million last year while First Community Bank (FCB) posted a loss of Sh307 million within the same period despite both players recording increases in net income during the year.

ADIB converts USD 599 mn to regulatory capital

Stanley Carvalho reported in Arabianbusiness on 29 March that Abu Dhabi Islamic Bank became the fourth Abu Dhabi bank to announce it has secured financing from the Ministry of Finance. ADIB secured AED 2.2 bn of government deposits and converted it into regulatory capital following similar moves by rivals in the credit crisis.

With the conversion into Tier 2 capital, ADIB's total equity increases to AED 11.02 bn and its capital adequacy ratio (CAR) will be 19.75 percent.

Tiras Mahmoud is CEO of ADIB.

AGM Al Baraka Group

Albaraka Banking Group B.S.C (ABG) held its Ordinary and Extra Ordinary General Meetings today in Manama, the capital of Bahrain. A cash dividend of USD 27.9 mn was decided, which represents 4 % of the issued capital further bonus shares were approved in an amount of USD 46.5 at the rate for one share for every 15.

After deducting all the expenses, the total net income amounted to USD 201 mn in 2008, reflecting an increase of 37.1 % over the income in 2007 after excluding the effect of the extraordinary profit arising from the IPO of the Group's unit in Turkey from the profits of 2007.

First Islamic Bank in Sri Lanka

The Amana Group was recently given a Letter of Provisional Approval by the Central Bank (CB) to establish a licensed commercial bank named Amana Bank Ltd., among the conditions is to raise a minimum capital requirement of Rs 2.5 bn.

Dubai Islamic Bank sets up JV in Jordan this year

Dubai Islamic Bank is set to implement this year its joint-venture with Jordan Dubai Capital and Dubai International Capital to invest in Industrial Development Bank and convert it to the Jordan Dubai Islamic Bank.

Malaysian Rating Corp. plans to offer Sharia Ratings

Malaysian Rating Corp. starts offering from July 2009 onwards services to rate the degree of Sharia compliance of Islamic financial institutions. The audit will review the risk management culture and frequence of Sharia meetings aside from management skills.

The Agency targets fund managers, insurers and banks in Malaysia first before it plans expansion to South-East Asia.

Mohd Razlan Mohamed is the CEO of the Malaysian Rating Corp.

Unicorn Malaysia announces maiden net profit

Unicorn International Islamic Bank Malaysia Berhad has reported a net profit of MYR 812,546 (USD 223,993) for 2008, its first full year of operation with an international Islamic bank license awarded under the Malaysia International Islamic Financial Centre (MIFC) initiative. Unicorn Malaysia is a wholly-owned subsidiary of Bahrain-based Unicorn Investment Bank.

The bank, with the BNM’s approval, has also increased its paid-up capital via a non-renounceable rights issue. As of year-end 2008, the Bank’s paid-up capital stood at MYR 71.9 million (USD 19.8 mn), versus a MIFC minimum capital requirement of MYR 10 million (USD 2.7 mn)

Unicorn Malaysia has four business lines: Treasury, Corporate Banking, Investment Banking and Strategic Acquisitions/Direct Investment.

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Ithmaar Bank outlines 2008 achievements

Ithmaar outlines 2008 achievements and concludes that due to good diversification the global crisis has been well mastered. Ithmaar reported USD 85.2 mn in consolidated profits for 2008.

Ithmaar Bank, a Bahrain-based investment bank with global reach, heads a regional banking and financial services group that comprises more than 20 subsidiaries, associates and joint ventures. Their combined activities, covering investment, private, retail, and commercial banking, private equity, Islamic insurance and assurance, equipment leasing, and real estate development, form a unique 360 degrees value chain that embraces the entire spectrum of banking and financial services.

Michael P. Lee is CEO of Ithmaar Bank.

In February 2009, following a meeting of the Bank’s Board of Directors, Ithmaar reported $85.2 million in consolidated profits for 2008. Of these profits, $22.2 million are attributable to the Bank’s shareholders. Ithmaar also reported significant growth in both its total assets and its funds under management, and said its balance sheet remains strong, with liquid assets at $1.3 billion, representing around 23 percent of its total assets.

Al-Salam Bank Bahrain progressing merger talks with Bahrain Saudi Bank

Bahrain-based lenders Al Salam Bank and Bahrain Saudi Bank said in a joint statement posted on the Bahrain stock exchange that the due diligence and evaluation is expected to be completed in the coming weeks. The planned merger would create a bank with combined market value of USD 400 mn.

The two banks said regulators and shareholders would be approached in April to approve the deal.

Call for Islamic Microfinance in Nigeria

Maje T. Sanusi reported in the Triumph Newspaper on 24 Marcht about the Micro-Finance Investors Forum organized by the Central Bank of Nigeria (CBN) and held in Kano. The Principal of Oasis Associates, Malam Ahmad Dogara has called for Islamic Micro financing in the Nigeria’s banking system.

Annual General Meeting Shamil Bank

Shamil Bank has taken over Faisal Private Bank in Switzerland completely and is itself is a wholly-owned subsidiary of Ithmaar Bank. Shamil Bank also acquired a 34 % stake in takaful company Solidarity.

Shamil Bank reported USD 66.8 mn in total income, and a net profit of USD 22.8 mn last year during their Annual General Meeting.

Faisal Al Alwan is the CEO of Shamil Bank.

ADIB board approves AED 2 bn sukuk

The board of Abu Dhabi Islamic Bank has approved issuing a AED 2 bn (USD 545 mn) sukuk to the government.

Reuters: Dubai Islamic Bank prepares USD 817 mn capital hike

Dubai Islamic Bank is considering raising AED 3 bn (USD 817 mn) in fresh capital and converting emergency government deposits into regulatory capital. The bank's board of directors would discuss the two measures on March 25, the bank said on Tuesday in a statement on the bourse website.

Rival banks, such as Union National Bank, National Bank of Abu Dhabi and Emirates NBD Bank in the UAE have already launched similar moves.

KuveytTürk aims to enter German retail market

KuveytTürk aims to cater for German Muslims from payment services to the whole range of Islamic finance products in the years to come. The application process for a financial services branch with both regulators is ongoing but not yet finished contrary to what media sources were reporting yesterday.

Amlak and Tamweel's future direction is getting clearer

Nadia Saleem reported in the Gulf News that the possible merger of the UAE's largest Islamic mortgage providers, Amlak Finance and Tamweel, is in the final stages of being resolved, while the liquidation option has been taken off the table and quotes Sultan Bin Saeed Al Mansouri, Minister of Economy informing reporters about it.

Aside from merger, keeping them seperate and liquidation was under discussion.

Nigeria circulates draft of Islamic banking regulation

According to Les Afriques the Central Bank of Nigeria is circulating a draft of their regulation for Sharia compliant financial institutions.

IDB plans USD 500 mn sukuk

The Islamic Development Bank (IDB) said that it planned a USD 500 mn sukuk, to finance its 2009 financing program.

Russian VTB Bank to enter sukuk issuance market

Oksana Kobzeva reported on 18 March on ArabianBusiness that Russia's second largest bank VTB may become the country's first issuer of sukuk. VTB Capital and Liquidity Management House, a subsidiary of Kuwait Finance House, on Wednesday signed a protocol of intention aimed at cooperating in the development of Islamic finance in Russia and other former Soviet countries.

VTB Capital is headed Yuri Solovyov

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