IslamicFinance.de

Saudi Almarai Co picks NCB Capital to arrange local currency sukuk. The dairy group Almarai is going to hold meetings with the Saudi investors over next two weeks.

A new initiative to transform Dubai into a global hub for sukuks is aimed at positioning the UAE as a top-ranked economy in the world, according to His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai. Dubai is planning to achieve its goal through a series of initiatives and programmes which in turn will activate the role of Islamic economy in the economy. Moreover, the necessary organisational framework will be completed and national cadres and experts mobilised to give this sector the anticipated momentum.

Aljazira Capital Co., the investment arm of Saudi Arabia’s Bank Al-Jazira (BJAZ), hired Samer Al-Jaouni as head of institutional brokerage and assistant general manager. He will start at the bank after regulatory approval. Aljazira Capital is one of about 30 brokerages in Saudi Arabia.

Recep Tayyip Erdogan, the prime minister of Turkey, reinforced his credentials as a political leader of the Muslim world at the Sharjah Government Communication Forum this week. Besides championing of political causes in the region, he used the forum for the enhancement of his country's economic and trade relations with GCC states. A memorandum of understanding signed by investment officials from Turkey and Sharjah aims to extend further the business relationship between Turkey and a UAE emirate. Mr Erdogan certainly seems to have pulled back from full-blown commitment to a Europe-orientated strategy. In contrast, trade and economic relations to the south-east are blossoming.

Dubai Electricity & Water Authority has given initial profit guidance of low 3% on its prospective five year benchmark sukuk. The dollar denominated ijara (asset leasing) deal, which could be as large as $1bn, is set to be priced this week.

The real estate developer Nakheel on Tuesday announced that it paid an additional Dh206 million to its creditors as part of its debt restructuring. The funds, due to be paid at the end of February 2013 in accordance with the developer’s financial restructuring commitments, bring the total loan interest and trade creditor sukuk profit paid to Dh923 million since restructuring. According to Nakheel chairman Ali Rashid Lootah, The company is in a good financial position and has about $600 million of cash on its balance sheet.

Dubai Electricity and Water Authority plans to issue sukuk of at least US$500m this week, after releasing early price guidance for the deal on Tuesday. DEWA is aiming to sell the dollar-denominated sukuk at a profit rate in the low 3 percent area. The sukuk is widely expected to attract strong investor demand. Standard Chartered, Citigroup, RBS and local lenders Emirates NBD, Dubai Islamic Bank and Abu Dhabi Islamic Bank are mandated joint bookrunners on the deal.

Seera Investment Bank yesterday reported a total income of more than $12 million for last year. Net profit for the year was approximately $7m. Chief executive Abdulla Janahi said Seera's existing investments continued to generate income for the bank, and income realised during the year was primarily from recurring revenues from these investments including lease rentals and investment and management fees. Market conditions remain challenging and a quick turnaround appears unlikely he added.

Noor Islamic Bank has announced the appointment of Narendra Swarup as Chief Risk Officer (CRO). Swarup will be responsible for all the risk functions of the bank. These include credit, market, operations as well as compliance and governing information security, protecting against fraud and guarding intellectual property through developing internal controls. Swarup brings with him more than 25 years of international experience in risk management in sovereign funds and international banks.

The UAE insurance market is the largest and most developed insurance market in the Gulf region in 2011 where insurance premiums during the period recorded a 10% increase compared with 2010. UAE's insurance market has doubled in volume and achieved a CAGR of 21% through to 2010. The market, however, remains dominated by non-life insurance, which still accounts for 85% of total premiums. A total of 61 insurers operated in the country in 2011. The UAE government is working on reforms to implement a comprehensive legal framework in order to expand the insurance industry in its different forms.

In recent years the GCC financial service regulators have given importance to corporate governance and have come up with rules and regulations to implement the same. Qatar Central Bank (QCB), Qatar Financial Centre ( QFC) and The Saudi Monetary Agency are among the institutions that provided principles of corporate governance. Regulation in the GCC region has been strengthened to promote risk governance and financial stability in the financial services sector. Corporate governance promotes financial stability and can attract foreign direct investment, support the development of the bond market and encourage the production of more high quality research.

Awqaf and Minors Affairs Foundation (AMAF), has launched an initiative to raise customer service levels and contribute to faster, more effective communication channels through a series of monthly open meetings between senior management and Foundation beneficiaries. The open meetings took place in the Foundation's headquarters since the beginning of January. Ahmed Hassan Nasser, Director of Investment Department met with beneficiaries on each Tuesday of the month, while Huda Al Mannai, Director of the Department of Minors, conducted meetings on Wednesdays.

Dubai-based investment bank Arqaam Capital has hired ex-Credit Suisse banker Wafic Nsouli. He is expected to join Arqaam on March 18 and will take charge as executive director and head of institutional equity sales. Before joining Arqaam, Nsouli was head of Middle East and North Africa equities at Credit Suisse, responsible for the company's offices in Dubai and Saudi Arabia.

The Arab Petroleum Investments Corporation (Apicorp) has set up a $150 million fund aimed at leveraging growth opportunities in the petroleum product tanker charter market. It is the first investment fund to be established by Apicorp and also the first fund in the region aimed at a specific vessel category. The fund has acquired five medium range petroleum product tankers and these will be employed in the regional and international tanker market for five years to help meet the projected upsurge in demand for petroleum product carriers. The fund is co-managed by Tufton Oceanic.

Adib Alzamil has been elected as the new chairman of the board of directors of Jadwa Investment, suceeding Prince Faisal bin Salman. Alzamil is a senior member of the Zamil Group, where he is currently MD of finance and investments and serves on the board of directors and executive committee. He was MD of Zamil Industrial Investments Company from 1998 to 2004, and remains a member of its board of directors. He also serves on the boards of Sanabil Al-Saudia, Bank Albilad, Fajr Capital, Methanol Chemical Company, and Dana Gas. Alzamil holds a bachelor's degree in business administration from Portland State University.

The Investment Corporation of Dubai (ICD) is in talks with banks to launch its first Islamic bond, in order to diversify its funding sources. The deal will reportedly be completed this year. A source at ICD said the fund had no plans for a sukuk, but is turning to the Islamic bond market because of potential legislation capping lending by local banks to government related entities. Separately, ICD is also talking to bankers over a US$2bn loan due to mature in August, with refinancing the likely option.

Oman's Capital Market Authority (CMA) is encouraging consolidation in the country’s crowded financial sector, aiming in the long term for local banks to build a regional presence in the Gulf region. There are now 18 banks in the sultanate, whereas Oman’s three largest lenders account for approximately two-thirds of banking assets. According to Abdullah Salem Al Salmi, CMA’s executive president, the crowded field could lead to cutthroat competition, which would be unhealthy for the market and cause new entrants to struggle. However, he did not specify any ways in which the CMA might encourage consolidation.

Bank Nizwa is going to request the Central Bank of Oman (CBO) for allowing the bank to get relaxation in deploying funds in overseas markets for a certain period, until Sharia-compliant products are available within the domestic market. Dr Jamil Jaroudi, Chief Executive Officer of Bank Nizwa said there are restrictions in the new law that do not allow Islamic banks to achieve their full potential. The law for sukuk and takaful need to be issued, and the banking regulations have to be adjusted in order to attract Islamic investment, he added. The CBO needs to frame regulation for short-term instruments, which will allow Islamic banks to deploy their excess liquidity.

The markets for Islamic banking, insurance and sukuk bonds have all seen solid growth in recent years, but the sharia-compliant fund industry remains tiny. According to Hasan Al Jabri, chief executive of Saudi Arabia’s Sedco Capital, the growth of sharia-compliant investment has been stunted by a reputation for a lack of diversity, poor performance and high fees. Since May 2012, Sedco Capital has been building what is believed to be the largest sharia-compliant fund platform in Luxembourg. Its five vehicles hold $900m of assets. Sedco is currently launching two more vehicles. Mr Al Jabri emphasized that their investments are responsible, help creating value for the economy and jobs.

The CMA Board has issued its resolution approving Bank Albilad’s request to increase its capital from SAR (3,000,000,000) to SAR (4,000,000,000) through issuance of bonus shares. One bonus share will be issued for every (3) existing shares owned by the shareholders who are registered in the shareholders registry at the close of trading on the day of the extraordinary general assembly. Such increase will be paid by transferring an amount of SAR (1,000,000,000) from retained earnings account to the Company's capital. Consequently, increasing the Company's outstanding shares from (300,000,000) shares to (400,000,000) shares, by an increase of (100,000,000) shares.