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Bahrain-based Ithmaar Bank has announced that its retail banking subsidiary in Pakistan, Faysal Bank Limited, has registered a record profit for 2015. Faysal Bank registered a profit, after tax, of US$ 41mn (PKR 4.2bn) during 2015, a 70 percent increase over the profit reported for 2014. During the year, the bank's operating income increased by 95 percent, growing from US$ 35mn (PKR 3.5bn) in 2014 to US$ 67mn (PKR 6.9bn) in 2015. Total assets increased by 11 percent to US$ 4bn (PKR 430bn) as of 31 December 2015, compared to US$ 3.7bn (PKR 388bn) as at 31 December 2014. Faysal Bank also announced a cash dividend of PKR 1 per share (10 percent of share par value) for 2015.

Iranian banks have opened more than 480 million euros of credit through Iran-Europe Commercial Bank (IECB). An amount of 108 million euros of the total €480 million belongs to Bank of Industry and Mine while the rest are owned by other banks in the country including Mellat and Tejarat banks. The Central Bank of Iran (CBI) has announced that the Society for Worldwide Interbank Financial Telecommunication (SWIFT) is up and running and there exist no barriers to opening LCs via SWIFT. Registered in Hamburg, Germany, the IECB officially welcomed international banking relations with Iran.

Resetting Priorities - Redefining Roles

Five years ago, the Global Donors Forum was convened in Dubai to take on a challenging task: to define the roadmap for Muslim giving into the next decade. As a growing network of philanthropists, grantmaking foundations and socially responsible corporations, the Forum lead a consultative dialogue among the thought leaders from which, it was hoped, a new social compact could emerge.

Half a decade on, with the world having changed dramatically as events in the Middle East would attest, the Global Donors Forum 2016, has a new set of issues to focus upon. Foremost among these is the need to rigorously analyse the past decade in order to ascertain how best to formulate strategies to counter emerging challenges. The GDF 2016 will, therefore, attempt to set new priorities as it looks to redefine the role of philanthropy, with a focus on the Muslim world in a radically changed global landscape.

Thousands of Pakistani households are turning to microfinance institutions which provide loans based on Islamic law, or Sharia. The available video looks at micro financing solutions in Pakistan provided by Achuwat which provides interest free loans. Religious lending is expected to grow in the coming years, and this video looks at case studies of a school teacher and tailor. The majority of clients of micro financing solutions are women.

European banks are showing eagerness to resume activities in Iran now that the sanctions are being lifted against the Islamic Republic, according to Ali Divandari, director of Iran’s Monetary and Banking Research Institute (MBRI). Divandari made the remarks in a press conference on Tuesday to expound on programs and objectives of “The 2nd Business and Banking Forum Iran Europe” which will be held in Tehran from March 5 to 7. The forum is to strengthen ties between Iranian and European banks and also boost cooperation between Iranian banks and foreign investors, Divandari stated. Divandari further stated that the forum will host about 60 foreign participants mainly from Germany.

For sale: One bank with 114 branches in war-torn country; defrauded out of almost all its money; occasional target of terrorists. Ready to bid? That’s what Ashraf Ghani, president of Afghanistan, is hoping. He’s seeking a buyer for Kabul Bank, once the country’s largest. The government took it over in 2010 after its owners were accused of embezzling $825 million. The privatization is a test for Ghani, who wants to show the foreign donors who provide most of his budget that he’s committed to fighting corruption. Mohammad Aqa Kohistani, director general of Afghanistan’s Treasury Department, said he has received four expressions of interest since starting the sales process in October, including three from foreign firms. He wouldn’t identify them.

Islamic Business and Finance Development Fund and REDmoney Group are jointly organizing IFN CIS & Russia Forum on 15th of March 2016 in Moscow. Islamic finance should become one of the strongest driving forces toward effective development of an international market that unites more than 182 million people of the Eurasian Economic Union. Participation in the Forum has already been confirmed by representatives of the largest Russian and international financial institutions.

http://www.ifncisrussiaforum.com

The government of Azerbaijan announced that it is in talks with the Islamic Development Bank (IDB) on application of Islamic banking instruments in the country. Deputy Economy Minister Sahil Babayev also said that the Bank is ready to provide technical assistance to Azerbaijan, which has a predominantly Muslim population. The primary scope of our model’s project has already been outlined, he added. Azerbaijan, alongside Kazakhstan, is among several central Asian countries creating a more welcoming framework for sharia-compliant banking to attract investments and financing from the Islamic capital market. Babayev faced difficulty to name the exact date of introduction of Islamic banking model in Azerbaijan, explaining it with the number of issues to be solved.

Iran’s leading financial conglomerate and senior members of Iranian government bodies met over 150 international investors in Muscat, Oman today to discuss inward investment opportunities across a range of Iran’s sectors and industries. The roadshow was hosted by Sina Financial & Investing Holding Co, Iran’s leading financial holding company. The agenda focused on opportunities created by the re-opening of the Iranian economy to foreign participation, as well as an in-depth discussion of Iran’s capital markets. The roadshow concluded with a business-to-business networking between Iranian and international delegates.

Azerbaijan could see the launch of its first standalone Islamic bank as early as next year as the government makes progress to introduce legislation to facilitate interest-free finance. Azerbaijan, alongside Kazakhstan and Tajikistan, are among several central Asian countries creating a more welcoming framework for sharia-compliant banking with the help of the Jeddah-based Islamic Development Bank. A working group of cabinet minsters and the IDB is making progress on the legislation, which would allow the proposed Islamic bank to launch next year, said Behnam Gurbanzada, chief executive of Islamic finance consultancy BEST Solutions.

Azerbaijan could see the launch of its first standalone Islamic bank as early as next year as the government makes progress to introduce legislation to facilitate interest-free finance, Behnam Gurbanzada, an advisor to the new venture said. Azerbaijan, alongside Kazakhstan and Tajikistan, are among several central Asian countries creating a more welcoming framework for sharia-compliant banking with the help of the Jeddah-based Islamic Development Bank. A working group of cabinet ministers and the IDB is making progress on the legislation, which would allow the proposed Islamic bank to launch next year, said the independent Islamic finance consultant. The proposed Islamic bank would be able to launch operations as soon as the legislation is passed, said Gurbanzada.

The European Court of Justice ruled on Thursday that the assets of Iran's Bank Mellat should not have been frozen from 2010, dismissing an appeal brought by the European Council. The Council, the grouping of the EU's 28 member states, froze the funds of a number of Iranian financial entities from 2010 to combat Iranian activities that could have led to it developing nuclear weapons. In Bank Mellat's case, the Council said that it engaged in conduct which supported and facilitated Iran's nuclear and ballistic missile programmes. The court ruled that the reasoning set out did not enable Bank Mellat to establish which banking services it provided to which entities, particularly as the persons whose accounts it managed were not identified.

Many prospective banking customers cannot easily discriminate between the convential and the Islamic banking system. Despite this lack of clarity, the number of Islamic banks and Islamic banking counters of conventional banks have increased by the day. The question to ask is as to how exactly are they operating here and what models are they adopting in the presence of a well-established interest based banking system. Around 99 per cent Islamic banking in Pakistan revolves around lending and buy-back model and not even one per cent is based on profit and loss sharing. A physical asset is involved in deals. The real challenge for Islamic banks is how to cater to the borrowing needs of the government that are huge.

Iran remains essentially off limits to US banks, despite the lifting of some US sanctions. The Obama administration in mid-January eased several restrictions on doing business with Iran, including former “secondary” sanctions that had threatened to penalize companies outside the US for their business with Iran, as well as some restrictions on Americans seeking to make inroads in the oil-rich country. Nevertheless, most “primary” sanctions tied to accusations that Tehran supports terrorism remain in effect, blocking US businesses from joining a rush by non-US companies to cash in on Iran’s potential revival. It means that US banks have little access to the oil-rich country compared to their rivals in other countries.

Since reaching the nuclear agreement that lifted economic sanctions on Iran, President Barack Obama has pledged to continue to punish foreign companies that do business with the regime’s powerful Islamic Revolutionary Guards Corps. In theory, this will chill European investment in Iran because the IRGC, along with its front businesses, controls major portions of Iran’s economy in vital sectors such as oil, construction and banking. But despite recent reports of billions of dollars worth of new European investment in Iran, the US Treasury Department has seen no evidence that European companies are conducting transactions with the IRGC. Many sanctions experts question whether this is really possible.

UBL Fund Managers Limited (UBL Funds) announced the launch of the Al-Ameen Islamic Active Allocation Plan–IV, under the Al-Ameen Islamic Financial Planning Fund. This Plan is now open for subscription. The plan actively allocates investments between Islamic equity and Islamic income/money market classes with an aim to achieve potentially high returns. It has a term of two years and is ideal for investors who wish to benefit from the equity market and desire active management of their investment portfolios. Mir Muhammad Ali, Chief Executive UBL Funds, said that the Al-Ameen Islamic Active Allocation Plan series has been well received by investors with initial investments of Al-Ameen Islamic Active Allocation Plans I, II and III totaling more than Rs. 6.3bn.

IFC, a member of the World Bank Group, has released a study that finds overwhelming demand for Islamic finance among smaller business in the Kyrgyz Republic. The report revealed that 80 percent of micro, small, and medium enterprises (MSMEs) are interested in Shariah-compliant financing, a market that could be worth up to $456 million for lenders. Despite that potential, the study "Islamic Banking and Finance: Opportunities across MSMEs in the Kyrgyz Republic" found that Islamic finance was not widely available because of a lack of awareness and the high cost of structuring transactions. Yet Kyrgyz officials are working to overcome these challenges.

A fraud of around Rs 30 billion in Islamic investment system of Mudarba and Musharaka has been committed by the Elixir Group of Companies, reveals an investigation by National Accountability Bureau. The fraud, which has victimised over 35,000 people across the country, was committed by a group of so-called Islamic scholars through a large number of mosque imams, seminary managers, madrassa students, their families, relatives and acquaintances. The scam planners are all settled abroad and most of them have dual nationalities, according to a NAB officer who is close to the investigation process.

Freed of international sanctions, Iran has asked India to reactivate its accounts with Indian banks and allow Iranian banks to open offices here. Keen to quickly normalise banking and commercial relations with the world, Tehran also wants UCO BankBSE -3.50 % to open a representative office in Iran. Tehran has already opened an account with IDBI Bank. Central Bank of Iran's vice governor Gholamali Kamyab has conveyed to Indian authorities that Bank Pasargad and Parsian Bank were keen to open representative offices in India while Saman Bank was interested in opening a subsidiary, they said. State Bank of India (SBI) has accounts of 11 Iranian banks including Central Bank of Iran (CBI).

Iran currently accounts for more than 40% of the world’s total Islamic banking assets, or around $482bn. Iran could easily cross the $1tn-asset mark by 2018 given the urgency for cash-strapped Iranian public and private companies to raise liquidity after years of isolation from the international finance industry. Analysts expect that a large number of sukuk and other Islamic financing vehicles will hit the world market soon. Adding to private companies, the country requires funds for its infrastructure development programmes earmarked for the next decade worth an estimated $1tn. However, analysts point out that the road back into the global finance system for Iran could be bumpy as the long isolation withheld Iranian banks from implementing globally accepted reporting and compliance standards, and restoring ties of its formerly stand-alone banking system to global financial institutions could prove regulatory and technically difficult.