IslamicFinance.de

The South China Sea reportedly holds 11 billion barrels of oil and 190 trillion cubic feet of natural gas; some experts estimate even more. Unfortunately, there's no clear way to define who "owns" these resources, as China, Vietnam, Malaysia, Taiwan, the Philippines, Indonesia and Brunei all believe some, or all, of these resources belong to them. Many of these countries are forced to import a considerable percentage of their overall demand. Investors need to keep an eye on Southeast Asia, and the South China Sea in particular. The oil in place under that sea, as well as its importance as a trade route, could push some nations to the boiling point as they rush to secure their supply of oil. That's a catalyst for some stocks, while a big risk for others.

Indonesia's central bank estimates growth of Islamic banking assets will slow next year due to rising pressure from trade deficits and a depreciation in the rupiah. The country's authorities now plan to introduce an array of policies to develop the sector, ranging from regulating foreign exchange markets, introducing Islamic repurchase agreements as well as education and promotion initiatives. The central bank said a tighter policy in finance-to-deposit ratio, similar to the loan-to-deposit (LDR) ratio used for conventional banks, and developing a sharia-compliant lender of last resort (LOLR) would be needed to support the stability of the financial system.

Indonesia plans a new law that will require the spin-off of the sharia-compliant units of insurance companies. The move could reshape Indonesia's takaful market by spurring mergers as firms try to meet capital requirements for their full-fledged Islamic units. A draft law is now with parliament but won't be enacted this year as previously anticipated. It covers all areas - licensing, market conduct, corporate governance, consumer protection - for both takaful and non-takaful firms. The law is expected to give three years for insurers to comply with requirements to spin-off their Islamic units. Minimum capital requirements for full-fledged takaful firms would be set at 50 billion rupiah , compared with 100 billion rupiah for conventional insurers. Passing Indonesia's insurance law would close the last market that allows takaful windows to operate, helping develop the country's nascent Islamic finance market.

Indonesia's finance ministry did not receive any winning bids for all offered sharia bonds at Tuesday's auction, the debt office at the finance ministry said. The country offered project-based sukuk with maturities of 7-years, 24-years and 30-years with an indicative target of 1 trillion rupiah. Total bids were 366.3 billion rupiah ($31.7 million).

Police have named two more suspects in an alleged Bank Syariah Mandiri scam implicating three bank officials, bringing the total number of suspects to six. The two latest suspects are Hen Hen Gunawan and doctor Rizky Adiansyah. Gunawan allegedly used the identity cards of his 26 employees to embezzle up to Rp 12.4 billion ($1.1 million) from the bank through its loan scheme. Rizky, meanwhile, allegedly borrowed ID cards of some of his neighbors to siphon Rp 12.2 billion from the bank. These two new suspects were ‘instructed’ by an accounting officer of the Bogor branch of BSM, John Lopulisa. John was earlier arrested, along with the head of BSM‘s primary branch in Bogor, M. Agustinus Masrie, the head of a smaller Bogor branch, Haerulli Hermawan, and Iyan Permana. The fraud is believed to have cost the bank Rp 59 billion.

The Indonesian banking and property mogul Dato Sri Tahir has donated 75 million US dollars towards programs for Indonesia's most needy. Ten million are for family planning, and 65 million for The Global Fund to fight AIDS, Tuberculosis and Malaria. The billionaire's gift is the largest donation the Fund has ever received from an individual in a developing country. Besides, Bill Gates through the Bill and Melinda Gates Foundation is also donating 65 million dollars to the Global Fund. The money will be used for prevention activities against HIV and AIDS. Moreover, the Fund has distributed 8.8 million bednets for malaria and supports detection and treatment of TB. Although philanthropy for social welfare isn't too familiar in Indonesia, wealthy individuals in Asia will be encouraged to give more generously if they see their contribution is being put to good use.

A more systematic endowment management would enhance the strength and potential of Muslims to use their wealth to help the community. The administration of endowment property ought to be conducted in a professional manner to protect its value for the benefit of the Muslim community. It could be done by setting up a special organisation, instead of the current practise of having these properties managed temporarily by various Islamic welfare bodies. The administration of endowment property would need to be re-examined in line with the global economic context to fully maximise its value and to avoid deterioration.

Indonesia’s finance ministry sold Rp 1.055 trillion ($96.22 million) of shariah bonds at an auction on Tuesday, with yields mixed. The country sold 700 billion rupiah of 6-month shariah T-bills, at a yield of 6.71615 percent, down from 6.75000 percent on Aug. 20. It also sold 355 billion rupiah of 30-year project-based sukuk, while its yield rose to 9.43750 percent from 9.24943 percent. Total bids were 9.308 trillion rupiah and the highest bid-to-cover ratio was 12.53 from 6-month shariah T-bills.

Indonesia’s need for dollars to defend the plunging rupiah will see the country pay the highest yield since 2009 when it sells global sukuk. The nation will offer around $1 billion of Shariah- compliant bonds after investor meetings. A yield of between 6.5 percent and 7 percent for 10-year securities is expected. Bank Indonesia announced measures aimed at increasing the supply of foreign-exchange on Aug. 23 to stem an 8.5 percent plunge in the rupiah this quarter. Moreover, the country raised its overall sales target to 231.8 trillion rupiah ($21 billion), from 180.4 trillion rupiah, as it set its budget deficit goal at 2.38 percent of gross domestic product. Besides, more shipments of unprocessed minerals will be allowed in order to narrow the current-account deficit.

PT Bank Muamalat Indonesia posted Rp372.20 billion (US36.1 million) in net profits for the first half of 2013, a 51.27 percent increase from the same period of last year. Bank Muamalat’s net earnings as of June 2013 reached Rp 1.25 trillion, compared to Rp 868.33 billion in June 2012. Margins for murabaha totaled Rp 925.23 billion, or an increase of 47.22 percent from the 2012 figure. Muamalats earnings from musharakah, or partnerships, reached Rp 746.65 billion, higher than the Rp 461.64 billion in June 2012. As of the first semester of 2013, Bank Muamalat managed Rp 47.92 trillion in assets, or up 46.59 percent from the same period in 2012. Meanwhile, PT Bank Ekonomi Raharja (BAEK) on the other hand reported a fall in net profits to Rp 105.33 billion, down 23.34 percent from last year’s Rp 137.4 billion. Bank Ekonomi Raharja recorded Rp 26.59 trillion in assets as of June 30 2013.

In September last year, Noor issued an invitation to the world to help shape the future of banking, with the launch of its Bank of the Future initiative, aimed at creating innovative ways of banking. As part of the initiative, Noor created an online Shape Your Bank competition to solicit people’s expectations of banks in the future, with prize money of $20,000 for the best idea on enhancing the banking experience. Nurul Iksan from Malang, Indonesia, won the first prize in Noor’s online competition. With the $20,000 in cash, plus an iPad he can begin pursuing some of his business ideas. He will use part of the money to open a fashion shop in nearby Bali. Iksan’s suggestion was to introduce a family account that is held by the head of the family with supplementary cards and limited budgets assigned to all family members. Such a concept has not been implemented in the region yet.

Syarikat Takaful Malaysia remains in the hunt for a strategic partner in Indonesia to help expand its distribution network there. The takaful operator was in talks to sell a stake or issue new shares in its Indonesian unit to a local partner last year, but the deal fell through. According to Takaful Malaysia Group managing director Mohammad Hassan Kamil, the group has not given up on its search for a strategic partner and is still actively scouting. Takaful Malayisa needs a strategic partner to put in the capital as well as provide the necessary expertise and people to help run the company. The Indonesian operations currently contribute less than 15% of the group's total revenue and less than 5% of its earnings. However, analysts say that the group's operations in Indonesia are poised for explosive growth of high double-digit rates in the next two to four years.

Indonesian Bank Muamalat has implemented Oracle FLEXCUBE Universal Banking to streamline its core business processes and to enhance productivity. Oracle FLEXCUBE is now live across all of Bank Muamalat's branches and e-channel network (ATM, EDC, etc) including mobile branches. It covers its retail and corporate banking business, including treasury and trade, all in compliance with Shariah Laws. The implementation was completed well within time and within Budget. By implementing Oracle FLEXCUBE Universal Banking, the institution has been able to improve business processes and significantly reduce processing times required for financial and administrative transactions. FLEXCUBE has helped to support 24-hour banking operations as well as enable enhanced customer insight and simulations to deliver excellent customer service.

Baittul Maal wa Tamwil (BMT) Microfinance system which is being working in Indonesia should be introduced all-around the globe as the best system to eliminate poverty, Chief Executive Officer of Al-Huda Center of Islamic Banking and Economics Mr. Muhammad Zubair Mughal said. He was speaking at the International conference for “ Empowering SMEs for Financial Inclusion and Growth” held in Indonesia. During his address Mr. Zubair Mughal said, BMT has played an important role for the alleviation of poverty in Indonesia but unfortunately, these methods are being limited to Indonesia only. He stated that new Islamic Microfinance methods of BMT should be available along with Murabaha, Salam, Mudarabah, Qarz-e-Hasna and Waqf to Islamic Microfinance Institutes globally. He further added that Islamic Microfinance is very important along with branchless banking, product innovation and financial literacy in order to achieve financial inclusion for the Muslim population. The Global Islamic Microfinance Forum is going to be held on October 16, 2013 in Dubai, to compile the strategy to strengthen the Islamic Microfinance industry, he ended.

Standard Chartered Plc will start offering Islamic banking in Kenya as a springboard into the rest of Africa, Wasim Saifi, its global head of Islamic consumer banking said. Moreover, it may expand services in Indonesia. He said the bank would offer the services through its Islamic banking brand, Standard Chartered Saadiq, targeting the country’s official Muslim population of 4 million people, as well as non-Muslims. The new products will first be launched in Kenya, then in other countries in east Africa and west Africa, as well as further afield. Especially Indonesia is interesting to the bank because Islamic finance is set to triple or quadruple in the next five-ten years in the country. Standard Chartered currently offers Islamic banking in Indonesia through associate Bank Permata

Since the Government of Indonesia issued the Sharia Banking Law in July 2008, the Islamic banking industry has shown a strong growth. According to data from Bank Indonesia, between 2008 and 2012, Islamic bank assets tripled, increasing by an average of 31.5% annually. But despite their growth, Sharia-compliant financial service providers accounted for only 4.5% of total banking sector assets. Policy discussions around Islamic bank development in Indonesia have largely taken place in the context of increasing financial access, especially to micro, small, and medium enterprises, or MSMEs. Bank officers are the key to stimulate demand for Sharia-compliant financing since they are the main source of education on Islamic products. Empowering Islamic financial service providers to reach more clients is not only good for business, but it is also smart policy.

LGT Venture Philanthropy is proud to launch its second call for applications for the Smiling World Accelerator Program(SWAP) 2013 in Indonesia.

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LGT Venture Philanthropy, dengan dukungan GEPI mengumumkan pembukaan pendaftaran kedua untuk Smiling World Accelerator Program (SWAP) 2013.

SWAP merupakan program khusus selama 9-24 bulan bagi para pengusaha di bidang kesehatan, pendidikan, energi yang berkelanjutan dan diperbaharui, pertanian, serta Teknologi Informasi dan Komunikasi, yang melayani atau bermanfaat bagi orang yang kurang mampu dan yang sedang berjuang kearah level pertumbuhan dan dampak positif yang lebih tinggi.

SWAP menyediakan bantuan dana sesuai kebutuhan (sampai dengan USD 50,000 per organisasi), mentor bisnis di lapangan dan juga akses ke berbagai jaringan internasional.

LGT Venture Philanthropy telah memilih dan membantu 6 organisasi yang masih dalam tahap permulaan dengan rata-rata investasi masing-masing sebesar USD 35’000, dan memberikan dukungan berupa bimbingan teknis melalui satu konsultan bisnis tetapnya di lapangan.

Asuransi Allianz Life Indonesia plans to double its takaful, market share in five years as it joins insurer Sun Life Financial Indonesia in forming partnerships with banks to tap rising Muslim wealth. Asuransi Allianz made an agreement with HSBC Holdings this year to offer its services. Sun Life will seek to boost business in rural areas via telemarketing campaigns and bank alliances. The takaful market share may climb to 7.9 percent in five years, from 3.9 percent currently. Islamic insurance assets in Indonesia, which has the world’s biggest Muslim population at 216 million, increased an average 53 percent in the last five years to Rp 11.4 trillion ($1.1 billion).

Bank Muamalat Indonesia delayed an up to $177 million initial public offering because of recent stock market declines. The sharia lender hasn’t decided on a new timetable for the IPO. Muamalat had already lowered the indicative price range on the deal to Rp 575-675 from the original Rp 625-975, to try and drum up demand. CIMB and Bahana Securities were hired to underwrite the IPO.

Issues raised and discussed at length during “International Workshop on Zakat, Waqf and Islamic Microfinance” and the idea of “Strengthening Islamic Social Finance Sector” were presented by Arshad Ajmal, Vice President of Sahulat Microfinance Society, at a programme organised by Forum for Discussion on Economic Issues. The event is a joint forum of Sahulat and Radiance Viewsweekly which was held in the national capital on 26 May. Mr. Ajmal, who was the only person invited from India as a resource person on Islamic Microfinance, shared his experience which he gathered and the points he raised during the workshop. Another notable point discussed was whether an Islamic Microfinance institution should and can be treated as a banking institution. Moreover, it was pointed out that Islamic finance places itself heavily on debt instruments and less on equity instruments.