IslamicFinance.de

The State Bank of Pakistan (SBP) rejected request of Jehangir Siddiqui and Company Limited (JSCL) to review its decision to disallow Dubai Bank to sell out its shares to its sponsor shareholders of BankIslami. JSCL approached the central bank in September 2015 to submit an application to the central bank with suggestions in order to getting additional shares in BankIslami. However, the central bank retained its decision and disallowed the management of BankIslami to sell its stakes of Dubai Bank to JSCL in pursuant to Founding Shareholding Agreement under which sponsor shareholders are not allowed to increase its shareholding. Earlier in August 2015, a consortium led by Ali Hussain of JSCL and Alkaram Group offered Dubai Bank to purchase its 144.200 million in the BankIslami.

The Central Bank of West Africa’s CFA-franc zone (BCEAO) has signed an agreement with the Jeddah-based Islamic Corporation for the Development of the Private Sector (ICD), to help finance Small and Medium-sized Enterprises (SMEs) through a $100 million Islamic fund. The ICD will commit an initial $30 million for the SME fund and will help seek additional investors to increase the amount to $100 million while the implementation monitoring was entrusted to the BCEAO. The Central Bank also committed to supporting SMEs by providing incentives to credit institutions, as well as developing complementary leasing and venture capital instruments.

The Securities and Exchange Commission (SEC) has reached an agreement with the Debt Management Office (DMO) to issue Nigeria’s maiden sovereign Sukuk. The decision by the two government agencies to collaborate to issue the Sukuk was a major outcome of the visit of the Director General of SEC, Mounir Gwarzo to the DMO on Wednesday. The visit was a return gesture to a similar exercise by the Director General of DMO, Abraham Nwankwo, in November last year. Mr. Nwankwo revealed that issuing a sovereign Sukuk has been part of the institution’s strategic plan drawn three years ago, urging Nigerians to support SEC to building capacity in order to realize the goal of issuing Nigeria’s first sovereign Sukuk in 2016.

Tasked with managing the kingdom's non-oil and gas investments, Mumtalakat seeks to turn around state-owned enterprises by promoting private sector-style transparency and sound corporate governance. The $11.2 billion fund holds stakes in 38 enterprises, including many of the country's largest employers, with a total value of about $8 billion. It has undertaken major restructurings at several of these companies, including two of the most critical: Aluminum Bahrain and Gulf Air. Mumtalakat is also beginning to flex its muscles as a portfolio investor, taking significant minority stakes in three foreign companies over the past two years in a bid to diversify its holdings and provide knock-on benefits to the Bahraini economy.

There’s so much more to finance than just returns, says alternative finance expert Tiara Letourneau (Cambridge Judge Business School MFin 2014). She believes that, used wisely, financial systems can make the world a better place, on both an individual and a global level. Letourneau is now based in Seoul, South Korea, in a new role – strategist at the Green Climate Fund. It’s a global platform, accountable to the United Nations, set up by 194 governments to respond to climate change by investing in low-emission and climate-resilient development. The private sector is needed to invest in projects that will enable the switch to low-emissions technologies, says Letourneau. It’s a big challenge – one of the biggest. And to Letourneau, it’s yet another opportunity to use financial systems to make the world a better place.

It took a Malaysian lender more than 10 years to complete its conversion to a fully-fledged Islamic bank, highlighting the challenge for countries such as Indonesia in their bid to become Shariah funding hubs. Agrobank would have given up its ambition to be Shariah-compliant had there been no commitment from employees and directors, said Chief Executive Officer Wan Mohd Fadzmi Wan Othman. The process was “grueling,” involving numerous meetings with staff and customers, and redoing all documentation, he said. The plan was first announced in 2004, derailed and then revived in 2012. Agrobank’s experience with complex approvals and legal hurdles brings to focus the uphill task for nations seeking to become financial centers for the $2 trillion industry.

Kenya is preparing to allow the use of Islamic finance, and is even preparing to launch its first sukuk. Speaking at the International Islamic Finance conference of Africa in Nairobi on Monday, Treasury Secretary Henry Rotich said that the Kenyan government would adopt legislation that would make Islamic finance possible. The conference is intended to aid developing countries in Africa to tap into the $2.1 trillion market of Islamic finance, using it as a catalyst of economic growth. Kenya can learn about the application of Islamic finance by taking advice from Muslim countries, Rotich said. Policymakers’ business leaders and government officials spent Monday and Tuesday speaking on how Islamic financial principles can help combat poverty and alleviate poverty in Africa.

Many Iranian banks have created a roadmap to open up to the world. Bank Pasargad, the second-largest finance company of Iran with billions of dollars of blocked assets in many countries worldwide, is one of them. According to Mostafa Beheshtirooy, a member of the executive board at Bank Pasargad, the bank has started conducting research into Turkey, Germany, Spain and China, adding that business could be done via a local partner or a take-over of a bank. Beheshtirooy said that, despite the negative impacts of the rising dollar and falling oil prices, the bank's total assets will reach $70 billion; in stark contrast to the current $19 billion it holds.

Takaud and Bahrain-based Takaful International are partnering to provide Takaful’s individual and corporate life insurance clients with Sharia-compliant investment solutions. The new partnership will enable Takaful to provide customers of its unit-linked savings policies with the opportunity to invest the savings portion of their policy in Shari’ah-compliant growth, balanced or prudent investment strategies. In support of the agreement, Takaud will provide a complete range of services, along with tools enabling customers to identify their investment profiles. Takaud will also provide marketing assistance and training for Takaful agents and others who will be presenting these new investment strategies to customers. The Memorandum of Understanding was signed by Takaud’s CEO Mr Luc Métivier and Takaful’s CEO Mr Younis J. Al Sayed.

Financial experts and researchers at international conference on Islamic financing have emphasised the need for framing a holistic vision for inclusive growth and promotion of Islamic mode of financing essentially with focus on poverty alleviation, access to loans to small growers, and reducing income inequalities. The two-day international moot titled “Towards Financial Inclusion: Developments in Islamic Economics, Banking and Finance”, held under the auspices of Centre for Excellence in Islamic Finance (CEIF), IMSciences, in collaboration with the State Bank of Pakistan, and the UK Department for International Development (UK-DFID), aimed at promoting academic, research, and best industry practices of Islamic finance as joint venture with commercial banks, regulators, universities, Islamic financial resources centers.

President Uhuru Kenyatta is hosting two leaders of Africa’s Ieading economies, Muhammadu Buhari of Nigeria and Abdel Fattah el-Sisi of Egypt. These visits are to be viewed within the prism of Uhuru’s broader strategy of economic, trade, and cross-cultural bridgebuilding. They underline his growing clout not just in trade and commerce, but also in the cut-throat arena of global geopolitics and nuanced national interests. The booming African Islamic economy provides an opportune vehicle to ameliorate the deprived conditions and lack of economic opportunity. It is a perfect fit for our infrastructure financing needs. Uhuru signed three agreements and four MoUs to promote trade between Kenya and Nigeria in June 2014 – on Trade and Agricultural cooperation, immigration and drug trafficking. A Joint Business Council was formed.

Bahrain's central bank said on Tuesday it is taking steps to close down Iranian-owned Future Bank, which is based in the Gulf state. Bahrain's central bank has not elaborated on its reasons for the action. Future Bank, based in Manama, is a commercial bank which was founded as a joint venture between two Iranian banks - Bank Saderat and Bank Melli - and Bahrain's Ahli United Bank. The bank's assets stood at 569.4 million dinars ($1.51 billion) at the end of September 2015. On Monday, Ebtisam al-Arrayed, head of regulatory policy at the central bank, said that the regulator had yet to make a decision about Future Bank after placing it under its administration last year, along with Iran Insurance Co - the Bahrain branch of an Iranian insurer.

Hosted by Operation HOPE in January in Atlanta (Georgia, USA), the 2016 Hope Global Forums Annual Meeting convened to Reimagine the Global Economy with a focus on 'Inclusive Economics'. Setting forth a goal to outline a solid vision for today's global economy, the meeting connected global leaders and Nobel Prize winners with government officials and the private sector. Leading the efforts to deliver youth financial literacy in the region with the Riyali financial literacy program, SEDCO Holding Group participated in this fourth edition of the Hope Global Forums. The three-day Annual Meeting topics covered the new and modern global economy, and demonstrated how community can serve as a call to action to inspire innovation and thought leadership to achieve economic growth and financial stability.

MicroDahab MFI, the microfinance subsidiary and corporate social responsibility initiative of the United Arab Emirates-based conglomerate Dahabshiil Group; and SolarGen Technologies, a Somalia-based distributor of renewable energy technologies, have announced a joint energy project in Somalia. The project will allow low-income Somali farmers and entrepreneurs to acquire a “solar-powered water pump” under a “lease to purchase” agreement. The African Enterprise Challenge Fund (AECF), a Kenya-based fund that promotes for-profit enterprises operating in Africa, has provided unspecified support to the initiative. MicroDahab will bear both the capital cost and risk of asset ownership, while its clients reap the benefits of using the water pumps, at minimal rents.

According to the official statistics, nearly 85 percent of the Kuwaiti population is still employed by the government. While the last decade has showed a surge in entrepreneurial initiatives, roadblocks and barriers remain. There have been many initiatives for and by entrepreneurs, such as support organizations, bazaars, and farmers markets that were geared toward small businesses and entrepreneurs, many of them just in their first or second year of operation. In 2010, Kuwait passed its first long-term development plan in almost 25 years. The government planned to spend $104 billion over four years to diversify the economy away from oil, and to boost private sector participation in the economy. Young business people are extremely supportive of the government’s initiative and focus on SMEs.

For over 6 million Pakistani smallholders with 10 acres of land or less, financing options are very limited and prevent them from building assets over time. Thus, farmers tend to do what has been done for centuries: use Artees, middlemen who have long responded to their agricultural and personal financial needs. Artees directly provide farmers with seeds and fertilizers, and collect the equivalent amount in crops at harvest time. According to some estimats, Artees finance at least 50% of smallholders in Pakistan. Since 2009, farmers in Punjab have had another financing option called Salam, which seeks to give them a bigger role in the decision-making. It is offered by Wasil Foundation.

Griffon Capital, a Tehran-based firm set up by a group of international and Iranian investors in anticipation of Iran’s nuclear deal, is seeking to raise 100 million euros ($108.2 million) by the end of the year for a new offshore fund specializing in the country’s stocks. Griffon’s Iran Flagship Fund, domiciled in the Cayman Islands, is an open-ended vehicle investing mainly in the Tehran Stock Exchange and Iran Fara Bourse, the company said. Griffon will start pitching the fund in the U.K. next month. Iran is opening up to foreign investors after the lifting of international sanctions earlier this month ended a decade of isolation. Last week Charlemagne Capital Ltd. and Turquoise Partners started an institutional fund to buy Iranian securities.

The government of Qatar is in talks with banks about a sovereign sukuk issue, sources aware of the matter said on Monday, as the Gulf nation returns to international debt markets to shore up state finances pressured by low energy prices. Bond sales, both in international and loan markets, were identified as the way Qatar would cover its 46.5 billion riyal ($12.8 billion) 2016 deficit, and talks are underway with a small group of banks to select arrangers for the first of these deals, according to three sources with knowledge of the talks. The government may issue the dollar-denominated sukuk as soon as March or April, two of the sources added.

Indonesia's Finance Ministry sold rupiah-denominated Islamic bonds on Tuesday, 26/01. The ministry set an indicative target of IDR 4 trillion (approx. USD $288 million). Proceeds from the bond sale will be used to finance the government's budget deficit. This deficit is estimated to reach 2.15 percent of gross domestic product (GDP) in the 2016 State Budget. Despite having the world’s largest Muslim population and forming a dynamic emerging economy, Indonesia plays a minor role in the global Islamic banking industry. Not only does Indonesia's Islamic finance industry lag far behind Islamic finance industries in other countries that contain a big Islamic community, but it also lags far behind the country's domestic conventional banking industry.

Mina Mehrnoush, the head of planning at Iran’s Organization for Trade Development, said three Russian banks have voiced their readiness to promote banking relations with the Islamic Republic in the near future in a bid to boost commercial cooperation between Tehran and Moscow. Mehrnoush also said that during a recent visit to Russia by an Iranian trade delegation, “good meetings” were held with three Russian banks, namely Mir Business Bank, Tempbank and RFC Bank. Mir Business Bank, which is the agent bank of Bank Melli Iran, agreed to provide good facilities and open proper credit lines for Iran, she said. The Iranian trade official went on to say that other issues were also discussed in her meetings with Russian banking officials, including opening accounts for Iranian companies without having to make a trip to Russia.