IslamicFinance.de

According to UN resident co-ordinator and UN Secretary General’s representative in Bahrain Amin El Sharkawi, the world needs financing of about $5 trillion each year to make the necessary progress towards achieving Sustainable Development Goals (SDGs). Discussions are on to set up a Bahrain-UN trust fund where banks can contribute to projects that focus on education, health coverage, access to energy, social housing and environmental protection. Mr El Sharkawi was speaking on the sidelines of the first General Council for Islamic Banks and Financial Institutions (CIBAFI)-United Nations joint forum themed The Role of Islamic Finance in Achieving Sustainable Development Goals: Opportunities and Challenges. The first day of the forum was concluded with the third session titled Zakat and Waqf as Tools for Financial Inclusion and Shared Prosperity.

Pakistan sought financial and technical assistance from Islamic Development Bank (IDB) to establish an export-import bank to improve trade among Muslim economies. International Islamic Trade Finance Corporation (ITFC) is an autonomous body under the Islamic Development Bank that aims to promote trade to improve the economic condition of the people of Muslim countries. Minister for Economic Affairs Hammad Azhar said ITFC has provided financing facility to Pakistan to cover its oil and liquefied natural gas imports over a period of three years. Furthermore, he asked ITFC to develop training tools in Islamic banking as Islamic banking is very popular in the country.

Présentée comme un nouveau pilier de la place financière il y a quelques années, la finance islamique était en veilleuse. L’organisation du deuxième Sukuk Summit au Luxembourg le 11 novembre dernier l’a remise en lumière. Bandar Hajjar, président de la Banque islamique de dévelop­pement a annoncé que son institution allait installer une «présence légale» au Grand-Duché pour développer les sukuk en Europe. Aujourd’hui, le Grand-Duché est le cinquième pays pour la domiciliation de fonds d’investissement conformes à la charia.

The overall macroeconomic conditions, geopolitical tensions and the threat of trade wars have all contributed to a slowdown in economic and banking growth. The Islamic finance industry is no exception. As the industry reaches maturity in established Islamic finance markets in Malaysia and GCC, experts have predicted that growth would be mostly driven by emerging and frontier Islamic finance markets. Despite this, these markets have not demonstrated the level of growth that was expected, and a number of structural challenges continue to persist, such as standardization, awareness and access to information and expertise. To address these challenges, the industry must come together to create a global ecosystem for Islamic finance.

UAE real estate developer Deyaar Development has partnered with Dubai Islamic Bank (DIB) to benefit from the bank’s attractive and customised home financing solutions. The solutions will enable customers to make full payment on handover of their property through flexible home financing programs, with monthly installments up to 25 years with options to further extend their home payments at competitive rates. Handover of Afnan District, the first of six districts within Deyaar’s Midtown integrated urban development, began in early November. Comprising seven buildings ranging from seven to 16 floors, Afnan District has a total of 659 apartments, including studios, one-, two-, and three-bedrooms, all of which are sold out.

According to a new report "The Evolution of Wealth Management in the World of Islamic Finance 2019", demand for Islamic finance solutions is set to increase in the GCC and Middle East in the next five years. The report highlights that promoters of Islamic wealth management are gearing up to offer a greater array of wealth management solutions to a client base that is generating private wealth at a remarkable rate. The report finds that socially responsible investing (SRI) and products offering environmental, social and governance (ESG) standards are driving the increase in demand for Islamic wealth management solutions. The report also shows that Islamic finance is no longer a niche product for Muslim investors alone; more and more non-Muslim families and institutional investors are seeking both performance and long-term value.

On November 27 the Islamic Development Bank (IDB) raised 1 billion euros in green sukuk. The 5-year sukuk was raised under IDB’s $25 billion sukuk programme and was priced at a profit rate of 0.037%. Proceeds from the issue will be channeled to climate change and green projects in IDB's 57-member countries. These include projects for renewable energy, clean transportation, energy efficiency, pollution prevention and control, environmentally sustainable management of natural living resources and land use and sustainable water and wastewater management. The joint lead managers and joint bookrunners for the sukuk were Citi, First Abu Dhabi Bank, HSBC, Landesbank Baden-Württemberg, Natixis, Société Générale, Warba Bank, and Standard Chartered Bank.

Ready to be taken to the next level, the burgeoning sector of Islamic finance is ready to take root in new regions through Turkey, Malaysia and Qatar. According to Yousuf Al-Jaida, CEO of the Qatar Financial Centre, Malaysia could act as a gateway for Islamic finance into Asia, with Turkey into Europe and Qatar the Middle East and Africa. He stressed that Malaysia was ready with its legal framework to facilitate the sector, while Qatar and Turkey need to step up and do more for the sector. Al-Jaida said these three countries could form a large platform to share experience, technology and knowledge. He is optimistic and sees a bright future, as Islamic finance is now growing at an even quicker pace than conventional finance.

According to UNICEF, investing in children is the fundamental solution to end child poverty and inequality and set the foundation for sustainable and inclusive economic growth. The statement was made during the Africa-China Poverty Reduction and Development Conference at the 10th Forum on China-Africa Cooperation (FOCAC). The 10th FOCAC Africa-China Poverty Reduction and Development Conference, co-hosted by China’s State Council Leading Group Office of Poverty Alleviation and Development (LGOP) and the Uganda Ministry of Agriculture, Animal Industry and Fisheries, had the theme of "Partnership for Transformation in Africa". Delegates expressed the urgent need to invest in social policies and infrastructures which combat child poverty in Africa, where around three out of every four children are affected by multi-dimensional poverty.

Al Salam Bank-Seychelles (ASBS) has announced the appointment of Alhur Mohammed Al Suwaidi as Chairman of the Board of Directors. Mr. Al Suwaidi currently serves as a member of the Board of Directors and brings over 15 years of experience in investment strategy to the role. Mr. Al Suwaidi also serves with the Abu Dhabi Investment Authority, where he has held various positions since 2004. Mr. Al Suwaidi has also served on a number of advisory boards of General Partners. He holds a bachelor’s degree in Business Administration from Chapman University, California, USA.

Nearly 17 years after its entry into Pakistan’s financial space, Islamic financing has grown considerably. Its acceptance has cleared up the initial mist, scepticism and suspicion associated with the concept. The effort to introduce Islamic banking started in early 2002 with the granting of licence to the Meezan Bank. The growth has resulted in five full-fledged Islamic banks namely Meezan Bank, Al-Baraka Bank Pakistan Limited, Dubai Islamic Bank, Bank Islami Pakistan and MCB Islamic Bank. Many conventional banks are also operating Islamic banking branches. However, there is still a low level of awareness about opportunity and economic benefits. Pakistan's present government has decided to initiate a comprehensive plan for the promotion of Islamic banking in the country.

According to the State of the Islamic Economy Report 2018/19, Malaysia has been the leader of the Islamic economy ecosystem for five consecutive years. In addition to Malaysia’s impressive performance as the front-runner in the commercial sector of Islamic finance, perhaps it is time for the country to gear itself up to also lead the revitalisation of Islamic social finance instruments. These instruments could play a vital role in reducing poverty and addressing challenging socio-economic problems such as education, unemployment, malnutrition and health issues. In Malaysia, the utilisation of philanthropic Islamic social finance instruments such as zakat and waqf seems to be restricted because of regulatory hurdles. The concept of sadaqah seems to be underutilised, although there is a huge potential in it. A product called Sadaqa House, initiated by Bank Islam Malaysia Berhad (BIMB), is an example of its application.

The "green is the new black" sustainability trend has reached the financial world as investors are slowly turning to invest in environment, social and governance (ESG)-compliant assets in Indonesia. Rising awareness of the mounting environmental and social problems has prompted global investors to invest in sustainable assets that comply with ESG standards. Although this type of investment has been gaining popularity in the developed markets for the past several years, Indonesia seems slow in adopting the trend. For BNP Paribas Asset Management Indonesia, sustainable mutual funds only accounted for 4% of its total assets as of September 2019. The fund manager currently offers three ESG-compliant mutual fund products to its clients that adhere to sustainable and responsible investment.

GFH Financial Group, the Bahrain-based Islamic investment bank, plans to invest $200 million (Dh734m) in the privately-owned schools sector through its new investment platform, Britus Education. Developed and emerging markets have both seen a surge in private education during the last decade. Britus Education will invest in mid-market schools that can be improved through maximising student capacity, improving academic outcomes and optimising fee structures. According to a report published by Alpen Capital, the total number of students in GCC schools is set to grow at a compound annual rate of 2.3% per year to reach 14.5 million in 2022. Enrolment in private schools is expected to grow at a compound rate of 4.1% per year until 2022, much faster than the 1.3% growth anticipated for public schools.

Australia could be a regional leader in Islamic finance but tax issues are holding the sector back domestically. Talal Yassine, the managing director of Crescent Wealth, said that Australia needed to seize the opportunity of being so close to the world's leading Islamic economy, Malaysia. He said Australia's financial industry should follow the lead of the agricultural industry, which decades ago made the decision to dominate halal exports. Australian Muslims spent $US5.3 billion ($A7.8 billion) on the lifestyle sector in 2018, including $US1.94 billion ($A2.9 billion) on media and recreation and $US1.74 billion ($A2.6 billion) on food. With a growing Muslim middle class, Yassine sees a massive opportunity waiting to happen.

Focusing on "African financial inclusion in the digital era", this event is a continuation of a similar summit held in Tunisia in March 2019. The event in Dakar will address the topics of Islamic finance, financial technology and economic empowerment. Panel discussions will focus on the next generation of fintech and the outlook of Africa, the social impact of fintech and the challenges Islamic finance faces in the era of fintech. Workshop sessions include analysing big data in Islamic banking and understanding how digital payments can support sustainable development. This event is jointly organized by the Islamic Corporation for the Development of the Private Sector (ICD) and the International Islamic Finance Training Institute (IIFTI).

Peer-to-peer lending platform Beehive has released an insightful new report revealing the state of MENA's SME ecosystem. The report is based on a survey of 175 SME owners and senior management and a roundtable of 13 prominent SME founders / CEOs. Key findings from the report include: surveyed MENA SMEs have more women in senior positions than the global average. 28% of respondents see innovation as a priority for growth, yet only 2% of business owners are currently trying to access finance to fund it. SMEs offer young people a great opportunity for development. 48% of SMEs would hire someone under 25 with no experience. The report focused on key areas that impact SMEs such as talent acquisition, innovation and growth factors. The survey results showed positive indicators such as SME appetite for market expansion and the opportunity for women in business.

The domestic capital market is expected to play a critical role in helping Malaysia meet the estimated RM45 billion required to finance its long-term sustainable development goals. Securities Commission Malaysia (SC) chairman Datuk Syed Zaid Syed Jaffar Albar said climate change poses physical and financial risks to companies. The change to more sustainable practices requires investments in new technologies and funding which carries risks with indeterminate outcomes. Malaysia alone is projected to require RM45 billion in the next five years. Therefore, the SC released the sustainable and responsible investment (SRI) roadmap to establish the country as a regional SRI centre. The roadmap identified 20 strategic recommendations based on the SC’s five i-Strategy: the widening of the range of SRI instruments, increasing the SRI investor base, building a strong SRI issuer base, instilling a strong internal government culture and designing information architecture.

Alami started as an aggregator platform in 2018. The firm later obtained a registration from the Indonesian Financial Services Authority (OJK) in May 2019, and since then, the startup has channeled nearly 70 billion rupiah (US$4.96 million) to more than 50 SMEs. Founder Dima Djani hopes to dispense a total of 80 billion rupiah (US$5.6 million) by the end of this year, and he targets to triple the number next year. From fundraising to business operations, Alami is committed to complying with all sharia principles and values. In the near future, Alami plans to reactivate its aggregator platform, and the firm is also currently exploring opportunities to add individual loan services in collaboration with sharia banks.

Dubai Islamic Bank (DIB) has proposed the acquisition of Noor Bank through a strategic investment via a share swap. Noor Investment Group and Emirates Investment Authority will become strategic investors in DIB. The share swap ratio is 1 new DIB share for every 5.49 shares of Noor Bank through the issuance of 651,159,198 new DIB shares in aggregate. UAE’s largest standalone Islamic bank will convene a general assembly on December 17 to seek shareholder approval for the proposal. Dubai Islamic Bank was designated by the UAE central bank in 2018 as systematically important. It is the only standalone and full-fledged Islamic bank out of four financial institutions the regulator considers "too big to fail".