Islamic Banking

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Inma Bank eyes SAR 10.5 bn in biggest Saudi IPO

Trade Arabia reported on 5 April based on Reuters that Inma Bank plans SAR 10.5 bn (USD 2.8 bn) in biggest Saudi Initial Public Offering (IPO) from April 7 to 16 selling 1.05 billion shares representing 70 % of the bank's capital SAR 15 bn capital. The Public Investment Fund, General Organisation for Social Insurance (Gosi) and the Public Pension Agency will each hold 10 %.

The IPO was previously delayed. Start of operations of the new Islamic bank is planned for the second half of 2008 with 15 branches.

The CEO is Abdel-Mohsen al-Faris. Lead Manager is Samba Capital.

Source: http://www.tradearabia.com/news/BANK_141332.html

New IFSB documents on Capital Adequacy and Liquidity Management

The Islamic Financial Services Board (IFSB) released on 1 April that the IFSB Council adopted two documents to further facilitate efforts towards enhancing the soundness and stability of the Islamic financial services industry.

In its 12th meeting held at the Islamic Development Bank's (IDB) headquarters in Jeddah on March 26th 2008, the Council of the Islamic Financial Services Board (IFSB) resolved to approve two documents that aim to further facilitate efforts towards enhancing the soundness and stability of the Islamic financial services industry. The two documents are:

Guidance Note in Connection with the Capital Adequacy Standard: Recognition of Ratings by External Credit Assessment Institutions (ECAI) on Shari'ah-Compliant Financial Instruments (Guidance Note)

Technical Note on Issues in Strengthening Liquidity Management of Institutions Offering Islamic Financial Services: The Development of Islamic Money Markets (Technical Notes)

Guidance Note in Connection with the Capital Adequacy Standard: Recognition of Ratings by External Credit Assessment Institutions (ECAI) on Shari'ah-Compliant Financial Instruments (Guidance Note)

New Islamic Private Bank in Switzerland planned

Andrew England and David Oakley wrote a short briefing on 30 March in the Financial Times about a new Islamic private bank planned in Switzerland. National Bank of Kuwait is supposedly partnering with a Saudi-Arabian institution.

Source: http://www.ft.com/cms/s/9bbfce9e-fe8c-11dc-9e04-000077b07658,Authorised=...

Saudi mortgage law awaits confirmation

AME Info reported on 30 March that the long awaited Saudi mortgage law is being considered by Saudi-Arabia's Consultative Council.

Islamic financing will play a promiment role in housing finance and it is expected that also the takaful industry will benefit from this move.

Full Text: http://www.ameinfo.com/151657.html

Al Rajhi licensed to open branch in Kuwait

Kuwait News Agency reported on 24 March that the Saudi-based Al-Rajhi bank, the largest Islamic bank globally, received approval to open a branch in Kuwait.

Full Text: http://aawsat.com/english/news.asp?section=6&id=12201

Bahrain: Islamic stock market and mega bank

Bahraini and GCC investors plan to establish an Islamic stock market in Bahrain. The stock market is part of the proposed Islamic mega bank project, which is said to have received licence from Central Bank of Bahrain.

Businessman Shaikh Saleh Kamel is quoted to have said that the bank aims for a capital of USD 11 bn, of which USD 1 bn are administrative shares for the bank's strategic investors, among them Al Baraka Group, a Kuwaiti bank, Saudi Investment Bank, Islamic development Bank and Bahrain Islamic Bank.

The mega bank is supposed to launch USD 33 bn worth of investment funds in regional and international markets.

Source:
http://www.gulf-daily-news.com/Story.asp?Article=212659&Sn=BUSI&IssueID=...

State Bank of Pakistan issues updated guidelines

The new standards of the State Bank of Pakistan (SBP) cover appointment of Shariah advisers, conflict resolution in Shariah rulings, use of charity fund and introduction of new products, reported The News Pakistan on 26 March.

Currently, total assets of Islamic banking industry in Pakistan had exceeded Rs 200 bn and the branch network of 18 Islamic banking institutions (i.e. six full-fledged Islamic banks and 12 conventional banks having Islamic banking branches) has expanded to 47 cities.

Full text: http://www.thenews.com.pk/daily_detail.asp?id=102998

Lawyer Michael McMillen joins Fulbright & Jaworski

The reknown Islamic finance specialist lawyer, Michael McMillen, joins Fulbright & Jaworski as partner to lead its global Islamic finance practice. He used to work previously for Dechert and King & Spalding.

Source: legalweek.com

Dubai Financial Market Sharia Board issues first Islamic standards for classifying listed companies

Business Intelligence reported on 18 March that the Sharia Board of the Dubai Financial Market (DFM) has issued the first standards for trading shares. The establishment of such standards is in line with DFM becoming an Islamic exchange as decided on the Annual General Meeting in 2007. Since then the Sharia Board with its Chairman, Dr Hussain Hamid has focused on the establishment of criteria to classify listed companies in terms of Sharia-compliance and accounting practices.

The standards are divided into five sections and cover the following areas: definitions of terms and criteria; implications for brokers and investors; guidelines for compliance for conventional firms; conventional income guidelines; and general rules and regulations.

Mr Essa Kazim is Chairman of the DFM.

Source: http://www.bi-me.com/main.php?c=3&cg=2&t=1&id=18389

Qatar Islamic Bank studies expansion into Egypt and Turkey

Matthew Martin reported on 18 March that Qatar Islamic Bank (QIB) is evaluating opportunities to acquire a conventional Egyptian bank and convert it into an Islamic bank, and is also applying for a banking licence in Turkey.
Qatar Islamic Bank will likely follow its strategy of independent brands, like before in regard to European Finance House in London, Asian Finance House in Malaysia and Arab Finance House in Lebanon.

Source: meed.com

CIMB to latch on Islamic banking expertise in China expansion

Joyce Goh reported in The Edge Daily, Malaysia about plans of Bumiputra-Commerce Holdings Bhd (BCHB), parent company of CIMB Group, will use its 20% stake in Bank of Yingkou (BOYC) of China as a springboard to expand its business there, particularly latching on its Islamic finance expertise to carve a niche for itself in one of the world’s fastest-growing economies. China has a larger Muslim community than China. BOYC is looking to expand to Shenyang — the city in Liaoning province earmarked to be an Islamic finance hub of China. Just three months ago, BOYC received the approval from the Chinese government to transform itself from a local commercial bank into a regional bank, thereby giving it the green light to expand its services in the Liaoning province.

Stanchart applies for Malaysia Islamic bank

Saeed Azhar reported on Reuters on 18th March, that Asia-focused Standard Chartered Bank has applied for a license to set up a separate Islamic banking unit in Malaysia, aiming to capture growth in a business that has escaped global credit turmoil.

Standard Chartered had $1.4 billion (699 million pounds) of Islamic banking assets in Malaysia at the end of 2007, more than double the year ago period, he said.

HSBC and Singapore's third-biggest lender, Oversea-Chinese Banking Corp , have already received regulatory approval to set up Islamic banking units in Malaysia.

Source: http://uk.news.yahoo.com/rtrs/20080318/tbs-uk-standard-chartered-malaysi...

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Peer to Peer in Banking & Development

Recently I came across the website www.kiva.org - which happened to be an Internet based charity. What they do? They connect those people who need a microfinance with those small scale donors previously not accessible. It brings together people willing to lend a 25 $ with those who need a 500 $ for a cow, and syndicates it with different lenders globally. A fascinating technology, showing where you contribute and could make difference.

My belief is, that this peer to peer concept using institutional infrastructure for distribution but relying on a high number of small donors, has a great future. People have confidence to make a difference.

Have a look and think about, how this platform could be used in other ways as well!

Once more: www.kiva.org

German: Vortrag - Ansätze in Europa zur finanziellen Einbindung von Muslimen

Der Vortrag zeigt vergleichsweise die Grösse und die Spezika des deutschen im Vergleich zum britischen Finanzmarkt für Muslime auf. Desweiteren werden Produktvorschläge, welche die Zielgruppe in Deutschland benötigt und Schlüsselbegriffe des Islamic finance erläutert. Ziel von Islamic finance ist somit die finanzielle Einbindung von Muslimen in Deutschland (financial inclusion).

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