IslamicFinance.de

#UAE-based airline Etihad Airways tapped the Islamic finance market with the largest ever sukuk issuance in the MENA region’s aviation history. In November 2016, Etihad Airways made its debut on the debt capital markets with a benchmark US$1.5bn sukuk deal. Etihad was initially rumoured to be raising US$500mn, but there was strong demand and the company’s debut US$1.5bn sukuk became the highest rated paper from an airline issuer. The book consisted of high-quality investors from the MENA region, Asia and Europe, creating significant price tension that enabled Etihad to optimize pricing and issue size. Banks dominated the distribution cross-section (77%), while 13% of the notes were allocated to fund managers, 5% to private banks, 4% to insurance and pension funds, 1% to other investors. The 5-year sukuk was launched under the newly established Islamic Trust Certificate (Sukuk) programme and represented a landmark debt capital market transaction.

Global law firm Baker McKenzie has successfully acted for Dubai Islamic Bank in its defence of a $2 billion claim brought against it in the English Commercial Court. The claim was brought by Plantation Holdings, a holding company owned by an Argentinian-resident property developer. The allegation was breach of contract related to plot of land on the outskirts of Dubai, which Plantation had planned to develop into a high-end luxury lifestyle and equestrian complex. The Bank took security over the project as part of the restructuring of a $500 million debt owed to it as a result of a complex receivables financing fraud. The case was heard in an eight week trial, with evidence from witnesses from seven jurisdictions. The court ruled that Plantation's principal director had made up evidence and that another of Plantation's witnesses had manufactured documents, Plantation has been ordered to pay 70% of the Bank's costs on the indemnity basis. The nature of the case also resulted in examining the volatility of the Dubai property market and the functionality of its property registration system, as well as the Dubai authorities' approach to financial misconduct.

Debt issuance from the GCC is expected to surge in 2017 with sovereign issuers leading while conventional bonds outstripping sukuk both in terms of amounts raised and number of issues. The key drivers to bond issuances in the GCC during 2016, which more than doubled to $66.5 billion (Dh244.5 billion), was primarily the sovereign bond issuances by Saudi Arabia, UAE and Qatar. Saudi Arabia’s first international bond issuance valued at $17.5 billion in October last year was the biggest recorded emerging market bond. Saudi Arabia has indicated further bond issuances in the near term and the Kingdom has a target debt-to-GDP ratio of 30% by 2020 as compared to 13.2% for 2016. Banking sector contribution to bond issuance witnessed a steep decline from 22% in 2015 to 15% in 2016, although the size of the total offering increased by 36% $11.7 billion.

Qatari Islamic banks’ short-term high quality liquidity assets to cover monthly net cash outflow is comparable to those of their conventional peers and their funding pressures are to some extent mitigated by frequent bonds and sukuks issuance by the government, according to Moody’s, a global credit rating agency.

“In Qatar, the LCRs (liquidity coverage ratios) of Islamic banks are comparable to those of their conventional peers. This situation reflects the absence of sizable retail deposit franchises among the Qatari banks, coupled with heightened systemic liquidity pressures that had led to banks relying more heavily on market funding,” Moody’s said in a report. The funding pressures are mitigated somewhat by the frequent issuance of bonds and sukuk by the Qatari sovereign, a situation, which provides local Islamic banks with the same good access to HQLAs (high quality liquid assets) as their conventional peers, it said.
The rating agency found that five of the six GCC countries are Basel III compliant and have introduced LCRs, namely Saudi Arabia, Qatar, Kuwait, Bahrain and Oman; only the UAE has yet to adopt a LCR framework for its banks.

As the referendum on whether to leave or remain in the European Union looms in the UK, voices are getting louder, particularly in the country’s financial industry that it would not necessarily be a good idea to vote for a Brexit. Since the weight of the UK in the global financial market is substantial – the financial sector of the City of London has a 20% share in the global market for trading foreign securities and a sizeable part of it depends on the UK’s access to the internal EU market – such a strong position would be certainly threatened.
This could have serious impact on the growing role of Islamic finance in Europe which is entrenched in the UK and from there makes its way into the continent. Since the 1990s, when the first mortgages in the UK were set up in line with Shariah law, the country has aggregated the most advanced experience in Shariah-compliant finance in the Western world. Corporate sukuk followed a decade later, and in 2014, the UK became the first country in the EU to issue some sovereign sukuk and listed them on the London stock exchange. From then on, Islamic finance steadily entered the rest of Europe.

Turkish Islamic bank Albaraka Turk has received initial pricing feedback in the 10 % area for a potential U.S. dollar-denominated sukuk issue which would bolster its supplementary or Tier 2 capital, sources familiar with the matter told Reuters on Thursday.
The lender has received indications of interest totalling over $250 million, including those from joint lead managers, for the ten-year non-call five sukuk, the sources said. A potential deal is expected early next week subject to market conditions, they said.
Albaraka Turk, a unit of Bahrain-based Al Baraka Banking Group, has chosen Barwa Bank, Dubai Islamic Bank, Emirates NBD, Nomura, Noor Bank, Standard Chartered and QInvest to arrange the sukuk issue.

Currently, there is $65.9b of outstanding in labelled green bonds, with transport and energy remaining the dominant themes. Countries such as the UAE and Malaysia have shown the willingness to issue green sukuks, and advisers such as Climate Bonds Initiative hope to have at least one [issued] in 2016, the chief executive officer of the advisory firm told Gulf News.
“Dewa (Dubai Electricity and Water Authority) has said that they are considering issuing a green sukuk for clean energy,” said Sean Kidney, chief executive officer of Climate Bonds Initiative. The firm has a sukuk advisory group in the UAE, trying to promote issuance.

Hamdan Bin Mohammed Smart University (HBMSU) and Paris Dauphine University (UPD) have entered into a landmark agreement to extend cooperation in Islamic Finance education and training. Both parties will work closely to design programs and initiatives in Islamic Finance tailored for the GCC and MENA regions. They will also jointly develop curricula that will give full credit for courses taken in either of the institutions.

The Middle East conflict raises concerns over the general outlook for the sukuk market. But portfolio managers remain positive both on fundamentals and technicals for sukuk as they also offer a potentially attractive alternative amid prospects of rising interest rates. Sukuk are considered as an attractive option for those whose mandate allows to test new boundaries. Mohieddine Kronfol, chief investment officer of Global Sukuk and MENA fixed income at Franklin Templeton Investments said, that "the lower duration and persistent strong demand from Islamic financial institutions should continue to support the market and allow it to perform well relative to other fixed income sectors, particularly those that have higher average durations."

Fujairah has launched its first dedicated Islamic bank, NBF Islamic. It will offer a suite of retail banking products catering to key customer financial requirements and will be available across the UAE through NBF's branch network. The smaller emirates are already represented in the Islamic banking arena through Sharjah Islamic Bank and AMAL Rakbank.

Fitch Ratings has cautioned that the ratings of Gulf Cooperation Council (GCC) privately-owned corporates are being constrained by relatively weaker corporate governance than their developed market peers. The ratings agency said in a statement that this is mainly due to the absence of an effective independent board, weak transparency and limited disclosure practices and a move in this direction will still take time.

Fitch Ratings has assigned Al Hilal Bank's USD2,500,000,000 trust certificate issuance programme an expected Long-term rating of A+ and expected Short-term rating of F1. Key rating drivers are solely Al Hilal's Issuer Default Ratings.

Growth of Shariah-compliant banks in Qatar is poised to outpace that of the UAE lenders as borrowing rises amid $200bn in government spending for the 2022 soccer World Cup. Qatar's four Islamic lenders will almost double their asset base to $100bn by 2017, Standard & Poor's has said in a report. Last year, the assets of the largest Shariah-compliant bank in the country, Qatar Islamic Bank, grew five times faster than those of the biggest one in the UAE, Dubai Islamic Bank. Spending for the world's most-watched sporting event will spur lending for roads, stadiums and hotels.

Contribute to originate and potentially lead a variety of buy and sell side corporate finance mandates, dealing with potential buyers and sellers in terms of project execution. This person will also be responsible for day to day management of the transaction including direct liaison with key client stakeholders.

In this role, you should have an international background and have experience working for an international bank or Big 4 (M&A or corporate advisory).

[...]

Maintain good relationship with all the constituent in the market to ensure that quality business is referred to the bank on a regular basis.
• Pro-actively call on showrooms and customers and promptly respond to their calls in order to negotiate and finalize business deals within the targeted turnaround time and shariah guidelines.
• Analyze documents submitted by the customer and prepare credit proposals for submission to appropriate approval authority.
• Ensure portfolio quality by exercising sound credit judgement and complying with credit, shariah and product parameters.
• Obtain and provide market, customer and competitor's information and feedback.
• Address customer complaint within 24 hrs.

Job Purpose
• To assist the Relationship Team in achieving the assigned financial goals, in maintaining and managing a portfolio consisting of borrowing and non-borrowing relationship, resolving day to day issues and ensuring that relationship managers' in operational

Job Purpose
· Apply database technology and database analytic skills to support CVI lift through:
o Development and enhancement of marketing friendly customer and prospect databases through specialized knowledge and skills of database technology and platforms.
o Insightful database analysis of customer information for profitable cross-sell, up-sell and deep-sell and retention marketing.
· Provide data for database marketing campaign effectiveness and learning.
· Provide data to deepen customer and prospect knowledge.
· Facilitate and enable business managers to understand product ownership

Job Purpose
· To manage and enhance the existing commercial portfolio of Emerging Corporate customers and solicit acceptable new Emerging Corporate relationships in order to meet the pre-set financial / non-financial objectives with necessary assistance from ARM/CSO.

• To provide Transaction banking and trade services to Corporate, SME and Mashreq Gold segments.
Key Result Areas
• Ensuring account planning for entire Corporate and SME portfolios to support maximum cross sell penetration.
The incumbent is responsible for assisting in the Sales, development, implementation, rollout, marketing and maintenance of global transaction services, including but not limited to

This role is significant in growing our position as Top 3 GTS bank in the UAE and the GCC, bringing together effective product management and development disciplines across all Trade & Supply Chain as well as PCM product sets including collections, disbursements, channel and liquidity management, demanding in-depth knowledge and understanding of the entire cash management customer value proposition as is detailed in the Key Result Area section.