IslamicFinance.de

Emirates REIT, one of the UAE’s first regulated Shari'ah compliant Real Estate Investment Trusts listed on Nasdaq Dubai, saw a 13% increase in total portfolio value. The total portfolio value stood at $742 million, a year-over-year increase of $85 million, making it the largest Shari’ah compliant REIT globally. The total property income for the nine months also increased 22% to $36.3 million. The net asset value increased to $1.60 per share, or $480.7 million. CEO Sylvain Vieujot thanked the UAE’s leaders who established a stable financial ecosystem with solid laws and regulations that have allowed the United Arab Emirates to become a world leader in Islamic finance.

According to #Indonesian Economic Coordinating Minister Darmin Nasution, the development of the country’s sharia finance industry will increase female participation in the economy. He said Indonesian fashion and halal cosmetics were among the well-performing industries and most businesspeople in the two industries were women. Indonesia is one of the top five Islamic fashion industries in the world, with a total spending of US$12.7 billion annually. It is also in the world's top five regarding the sharia cosmetics/pharmaceutical industry with an average spending of $4.8 billion per year, according to data from Bank Indonesia (BI). BI deputy governor Hendar said inspite of the global slowdown, Indonesia's sharia industry was still giving positive signals.

According to Finance Minister Ibrahim al-Assaf, Saudi Arabia may follow its first international debt issuance with an Islamic bond sale. The size of future borrowing hasn’t been determined, but it will not be limited to bonds. Assaf said that part of it will be by the way of sukuk, but he didn’t specify whether the sukuk sale would be local or global. Saudi Arabia raised $17.5 billion this month in the biggest-ever foreign bond from an emerging-market nation. The kingdom is seeking to finance a budget deficit that ballooned to about 15 per cent of economic output last year.

Two successful investment funds have facilitated the Secura Investment Management, the first SEBI registered and Shariah compliant venture capital fund, to come out with a third fund – Realty AIF – with a target to raise 200 crore. The first scheme Secura India Real Estate fund Domestic Scheme 1 has completed with a pay back record of 18%, while the second fund is in the investment stage and its tenure will be over next year. Managing Director M.A.Mahaboob said funds will be invested in equity modes, quasi-equity and equity related instruments, investment in a co-investment capacity with development companies and other promoters. The minimum investment under the scheme is 1 crore which is to be paid in instalments in three years with a down payment of 10% of the capital commitment.

Bank Indonesia (BI) unveiled a waqf-based sukuk, aimed at developing social property assets to be commercially self-sustaining. BI Deputy Governor Hendar said the sukuk could further finance the development of commercial buildings such as office towers or shopping centers over waqf land. The coupon will be paid from the recurring income of the assets. According to Muhammad Anwar Basori, BI head of the sharia economic and finance department, waqf land was traditionally used for social and public purposes such as cemeteries, mosques, or schools. Waqf-based sukuk could be a solution and could provide cash to cover maintenance costs. Basori added there are 400,000 hectares of waqf land in Indonesia, 90% of which are cost centers. In Kuwait and Singapore, they have built many productive assets on waqf land.

Istanbul Sabahattin Zaim University (IZU) is opening its International Research Center for Islamic Economics and Finance (IRCIEF) on Oct. 28. The IZU hopes to become a center for academic studies in the field. Launched by Kuwait, Turk and Albaraka Turk participation banks, the International Research Center for Islamic Economics and Finance will offer market-based education to its students. By offering courses in Turkish and Arabic, the IZU will enable Turkish and foreign students to be specialized in the field. University rector and professor Mehmet Bulut said the center will train equipped students in undergraduate, postgraduate and doctorate programs. He promised that students will be educated in this center with the understanding of making Turkey stronger and noting that the accomplished projects will be carried out in collaboration with the participation banks.

Shareholders of Jaiz Bank unanimously voted for its shares to be listed and traded on the Nigerian Stock Exchange. The bank disclosed that this development will now open windows of opportunities for numerous individuals who desire to own shares in Jaiz Bank. Chairman of the Bank, Alhaji Umaru Abdul Mutallab, said the Bank’s authorized Share Capital has been sub-divided from 15, 000, 000, 000 Ordinary Shares of N1.00 each to N30, 000, 000, 000 Ordinary Shares of 50k each. Also speaking at the event, CEO Hassan Usman said once listed on the Nigerian Stock Exchange, existing shareholders can trade their shares while new investors can also invest by buying the shares.

The Silk Road Economic Belt and 21st Century Maritime Silk Road, or the One Belt, One Road (OBOR) initiative is central to China’s evolving role in the global economy. OBOR, unveiled in 2013, is China’s ambitious policy of revitalising the infrastructure of the ancient Silk Road trading routes and forging new trade routes. It offers great opportunities for the GCC in terms of inbound investments from China as well as the chance to deepen economic, cultural and diplomatic ties with Beijing. For the UAE is particularly important to showcase Dubai’s ability to provide China with a gateway to accessing regional liquidity and its expertise in Islamic finance. However, there are constraints arising out of stakeholders’ lack of familiarity with Islamic finance and the current Chinese policies and laws, which only cater for conventional financing methods.

The Islamic Development Bank (IDB) has appointed nine banks to arrange a new Islamic bond issue likely to be in excess of $1 billion. The mandated banks include Boubyan Bank, Credit Agricole, Gulf International Bank, JP Morgan, Mizuho, Natixis, NBAD, RHB and Standard Chartered for a five-year debt issue. The mandate was given at the end of last week and the notes will be sold only after the U.S. elections on Nov. 8. IDB sold its last U.S. dollar-denominated sukuk in March. That issue, of $1.5 billlion, offered 50 basis points over midswaps and was priced at par at 1.775 percent.

A l’occasion de la rencontre préparatoire du Salon International de la Finance Ethique et Participative SIFEP Mohammed Tahri, directeur général adjoint à la Société Générale Maroc a annoncé que son institution envisage de créer une dizaines d’agences dédiées à la banque participative. Dans l’attente de l’agrément de Bank Al-Maghrib, la Société Générale Maroc se prépare à exercer l’activité de banque participative à travers des succursales pour tester le marché. Le responsable de la Société Générale Maroc a annoncé que les résultats d’une étude de marché confiée par la banque à un cabinet marocain en coopération avec un cabinet français spécialisé en finance participative indiquent une attente manifeste du public marocain vis-à-vis de la finance participative.

The UNEP Finance Initiative Global Roundtable 2016 was held at the Grand Hyatt Hotel in Dubai. The panel of Islamic bankers and investors highlighted that the heart of sustainability lies in ethical business practices such as those espoused by Islamic financing. The experts mentioned that most Islamic institutions were under increasing pressure to integrate environmental impact and sustainability into their decision-making process. CEO of Abu Dhabi Islamic Bank, Tirad Al Mahmoud, said ethics themselves were the answer to everything. He added that financial regulators often failed to properly apply incentives and disincentives, and suggested ethical investments could be rewarded by discounts on capital. Panellist Nida Raza, Director of Advisory Services at the Islamic Centre for Development of the Private Sector, said she believed Islamic finance bodies must become more inclusive.

Deputy Prime minister in Charge of the Economy Mehmet Simsek said the size of the Islamic banking sector globally was projected to grow to $3.5 trillion in the next five years and Turkey aimed to manage a sizeable portion of this huge sector. He said the government was committed to help the sector thrive in Turkey. Furthermore, he indicated that the total size of assets of participation banks reached $183.93 billion by the end of 2015. Pointing out that the participation banks' share in the overall banking sector was 5.1%, he stressed the goal set by the representative of the sector was to attain 15% by 2025. The Turkish Treasury elaborated on the action plan called "Strengthening Interest-free Finance and Participation Banking" as a component of the Istanbul International Financial Center (IFC Istanbul) program. It was decided that the board would work on the issues raised at the meeting to develop the interest-free finance sector.

Grameen Foundation and Freedom from Hunger have joined forces to form a single unified organization. Its mission is to enable the poor, especially women, to create a world without hunger and poverty. Both organizations have roots in the earliest movements for microfinance, and today conduct programs that tackle poverty and hunger from multiple directions. Nobel Laureate Muhammad Yunus, founder of Grameen Bank in Bangladesh endorses the integration under the banner of Grameen Foundation. To better execute the integration, a newly reconstituted Board of Trustees will draw half of its membership from each organization. The new Executive Staff includes members of each organization. Over the coming months the two organizations will bring together their core programs and develop new approaches.

#Nigerian experts on Islamic finance met in Sokoto to discuss economic solutions, expressing the opinion that Islamic financing principles are the only alternative to end the current recession. The conference was organized by the Department of Management Science of Usman Danfodiyo University, Sokoto and ran under the theme "Management of Nigerian economy: Issues and Perspective in Islam". Lead presenter Dr. Ahmadu Bello Dogarawa said applying Islamic principles in corporate governance would go a long way in addressing Nigeria’s challenges. In his keynote address, Governor Aminu Waziri Tambuwal said Islamic finance was no more peripheral to conventional finances as it was being operated in 75 countries, including western nations.

HSBC Amanah Malaysia has appointed Arsalaan Ahmed as its chief executive officer (CEO). HSBC Amanah announced that Arsalaan will be leading the Islamic banking businesses for retail, commercial and wholesale banking, and reporting to HSBC Bank CEO Mukhtar Hussain. Prior to joining HSBC Amanah, Arsalaan was appointed as the head of capital financing and financial institutions of Barwa Bank in Doha, Qatar, where he led the development of the Islamic debt capital market and wholesale banking platform. Arsalaan has 15 years of experience and has distinguished himself as an expert in syariah-compliant retail, corporate and investment banking.

S&P Global Ratings may not be ready to upgrade Indonesia’s credit rating from junk, concerned by rising bad debts and risks to the growth outlook. Indonesia failed in June to win an upgrade from S&P, which rates the nation’s debt at BB+ with a positive outlook. S&P said at the time that while the country’s fiscal framework had improved, it still faced challenges on its budget performance. Josua Pardede, an economist at PT Bank Permata in Jakarta, said Indonesia still faces fiscal risks. He estimated the tax shortfall for this year will be more than 200 trillion rupiah ($15 billion), causing the budget deficit to widen to around 2.7% of gross domestic product. The government has a deficit cap of 3% of GDP. The ratings company will meet with Indonesian Finance Minister Sri Mulyani Indrawati within the next few weeks before it makes its next assessment due in December. S&P is the last of the three main credit-rating companies to keep Indonesia on junk status.

The President of Kazakhstan, Nursultan Nazarbayev met with the President of the Islamic Development Bank (IsDB), Dr. Bandar Hajjar, on an official visit to the Kingdom of Saudi Arabia. President Nazarbayev praised the cooperation between IsDB and his country and congratulated Dr. Hajjar on his recent assumption of duties as the new IsDB Group President. President Nazarbayev plans to launch the program 100 Steps, which is designed to introduce structural and economic reforms to Kazakhstan. The program also envisages the launching of Astana International Financial Center as a center of excellence for financial services at regional and global level. President Nazarbayev called on IsDB to provide technical support in the fields of development and Islamic finance. Dr. Hajjar assured that the IsDB Group would provide the required technical assistance to support President Nazarbayev’s initiatives.

The Church of Scotland and Islamic Finance Council UK are meeting at a private round table in the British Parliament. As part of the interfaith initiative for a more socially responsible financial system, faith leaders, parliamentarians and finance practitioners gather to agree a shared values framework. The joint venture was launched earlier this year in response to the systemic failure and non-sustainability of the current financial model. The event is the second in a series of three workshops. The first reviewed the theological and philosophical underpinnings of Christianity and Islam in order to identify commonalities. At the second workshop the shared values framework will be reviewed and refined before participants explore the practical obstacles to realising ethical finance. Omar Shaikh of the Islamic Finance Council UK said that bringing the debate to the heart of London sends a strong international message that faith communities can work together for the greater good of society.

Gulf Finance House (GFH) said the negotiations are underway for acquisition of Bank Alkhair of Bahrain. The due deligence is continuing and formalities are yet to be completed. In a separate statement, GFH said that its unit has won a case against its former deputy chief executive. The verdict issued in favour of GFH’s unit is for circa $5 million (Dh18.4 million). Earlier in the month, the GFH board has approved the proposed settlement with assets of an estimated $350-450 million, subject to counterparties’ fulfillment of their obligations. The company said the estimated value of the assets is preliminary and subject to regulatory approvals and will have a positive impact on GFH’s financials for the fourth quarter of 2016.

Qatar-based developer Barwa Real Estate has signed a new facility agreement with Qatar International Islamic Bank (QIIB) worth $165m (QAR600m). According to the official statement, the move is aimed at securing finance for a part of its upcoming projects. This agreement reinforces Barwa’s strategy of strengthening its financial position by funding the upcoming projects through credit facilities with favorable rates, terms and conditions.