IslamicFinance.de

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.

Dubai Dubai Islamic Bank (DIB) recorded a net profit of Dh739 million in the first half of this year, up 25 per cent from Dh592 million during the same time a year ago. Net profit for the second quarter of this year reached Dh437 million, up 31 per cent from compared to Dh334 million registered during the corresponding time last year. Net revenue for the first half of the year amounted to Dh2.1 billion, an increase of 10 per cent from Dh1.9 billion recorded during the same period in 2012. As of the end of June, the bank’s total assets reached Dh111.1 billion, customer deposits grew by 23 per cent to Dh82.4 billion. The bank’s gross investing and financing assets rose 1.4 per cent to Dh59.6 billion. During the first half of the year, the bank expanded its retail franchise to include three branches and 23 ATMs to its network. Additionally, it completed its acquisition of Tamweel, an Islamic home finance provider.

According to a recent focus group held in Dubai by ACCA (the Association of Chartered Certified Accountants), a common definition of what sustainability is and what it means in the UAE would help to encourage more companies to invest in creating their own corporate sustainability reports on a regular basis. The UAE focus group brought together 11 high level delegates representing a range of organisations. Whilst the level of sustainability reporting is currently low in the UAE, it was felt that sustainability reporting should play an important role in the development of the UAE in the years to come. Represantatives of the ACCA hope that these discussions will make a difference in helping to change perspectives and show just how important corporate sustainability reporting is to helping the UAE’s growing economy maintain its momentum.

Ramadan 19, named as “Emirati Humanitarian Work Day”, is an annual event in memory of the late Shaikh Zayed Bin Sultan Al Nahyan and aims to inculcate the spirit of giving and philanthropy nationwide. As many as 1,500 charitable activities will be organised across the country by 270 local and federal departments to mark the day. The activities will feature presenting refrigerators and air conditioners to the needy families, setting up a chocolate factory to offer jobs to people with special needs, workshops for needy families, a day for orphans and distribution of Ramadan rations and Eid Al Fitr gifts. Moreover, the UAE has launched the “Egypt in Our Heart” campaign, which will contribute to infrastructure development in Egypt, Besides, other initiatives have been launched, to help Syrian refugee children and to combat blindness and visual disability, among others.

The UAE Central Bank had ordered banks and financial companies to adhere to its Notice Number 237/2013 dated July 18, 2013, with regard to issuance and marketing of mutual funds. The Central Bank has asked all banks and investment companies to complete a sheet in respect of mutual funds issued or marketed by the bank/company in the UAE since inception up to February 24, 2009, in order to provide information to Securities and Commodities Authority (SCA). According to Article 2 of the Regulations, mutual funds established in a free zone within the UAE are treated as foreign funds. The regulations define a mutual or investment fund as essentially a financial vehicle for the purpose of investment against the issue of investment units of equal value and rights. As per the law, no local mutual fund may be established and no foreign mutual fund may be promoted within the UAE, prior to obtaining a licence for establishment or approval of the promotion of the mutual fund from the SCA.

Capital Intelligence (CI) has maintained Sharjah Islamic Bank's (SIB) Financial Strength Rating (FSR) at 'BBB+', with SIB's exceptionally sound capital adequacy ratio (CAR) and good liquidity being major supporting factors. Rising non-performing Islamic financing facilities (NPIFFs), a low coverage ratio and high customer concentrations are major constraining factors. While profitability had been under some strain in the recent past, the Bank's good Q1 2013 operating performance is a favourable development. A 'Stable' Outlook is appended to the FSR on the expectation that some of the impaired IFFs will move off the non-performing list later this year, and that the coverage ratio will improve. However, if ratios remain unchanged or worsen, the FSR could be further adjusted downwards at the next review. The Foreign Currency Ratings are affirmed at 'A-' Long-Term and 'A2' Short-Term with a 'Stable' Outlook.

Abu Dhabi Islamic Bank (ADIB) opens its annual Ramadan exhibition this year at the Emirates Palace in Abu Dhabi. The Road from Jerusalem to Mecca and Medina follows last year's exhibition Discovering Ka'aba withtwo more replicas of central landmarks in Islamic history. The exhibition portrays a historical journey through three holy sites of historical and religious significance. The Road from Jerusalem to Mecca and Medina includes a replica of the Ka'aba which illustrates both the Ka'aba's outer façade and its inner structure. Rare photographs of the Ka'aba that depict its various architectural and design elements will also be on display. In addition, the exhibition showcases the Al-Nabawi Mosque and a model of the Al-Aqsa Mosque. The exhibition is open to the public every day from 08:30am to 12:00 midnight throughout the whole month of Ramadan.

HH Sheikh Hamdan Bin Mohammed bin Rashid Al Maktoum has launched the Dubai Center for Islamic Banking and Finance as a new step in support of the efforts towards establishing Dubai as the world's capital for Islamic economy. The centre is a collaboration between the Hamdan Bin Mohammed e-University and the emirate's initiative: 'Dubai: Capital of Islamic Economy'. The new centre will provide support to the initiative through three academic programs on human resources development, scientific research and community service. In the area of Human Capital Development, the Centre offers programs and courses. On the research front, The Centre conducts and facilitates research to advance the professional and theoretical foundation for Islamic Banking and Finance.The Center will also play a role in widening access to Islamic banking and finance education to the wider community.

Household debt poses a growing risk to the financial sector in the United Arab Emirates (UAE). As of June 2012, household debt totalled over US$114 billion, which translates to over US$95,000 in debt per household. 48% of UAE citizens have monthly loan repayment obligations that exceed their financial means. The UAE represents roughly 67% of the consumer debt in the GCC. One reason for the disparity is the difference in lending regulations. The positive news is that the banking sector in the UAE and GCC in general retains a high degree of liquidity. In conclusion, household debt remains an issue of concern in the UAE, and government policy should be directed towards the causes rather than the symptoms. Issuing debt relief must be coupled with stricter regulations on household lending, so that excessive lending and defaults can be prevented.

Ajman Bank partnered with Al Al Ihsan Charity Association as a main sponsor in its 'Ramadan Aman' Campaign. The objective behind this effort is to prevent drivers from speeding during the Ramadan rush hour before Maghreb prayer that often increases the risk of accidents. As part of the campaign Ajman Bank employees will serve as an active volunteer distributing some of the 100,000 iftar kits through the Holy Month in the emirates of Dubai, Sharjah, Ajman, Umm Al-Quwain and Ras Al Khaimah at selected areas. Every year there is a sharp rise in road accidents in the UAE during Ramadan. A considerably large number of these occur shortly before iftar primarily due to speeding.

Dubai Islamic Bank (DIB) has appointed Adnan Chilwan as chief executive. Chilwan, who was previously deputy CEO at the bank, replaces Abdullah Al Hamli who was named managing director. The management reshuffle at DIB comes when the bank is preparing for renewed growth, after it set aside about 5 billion dirhams ($1.36 billion) against bad loans following the 2009-2010 crash of Dubai's real estate market. According to Chilwan and Al Hamli, the bank has dealt with much of its balance sheet weakness and should see profits for 2013 grow in the double digits, allowing it to eye acquisitions in new markets in Asia. DIB, which is in the process of acquiring Islamic mortgage lender Tamweel , became the second Gulf bank to issue a hybrid perpetual sukuk when it priced in March a $1 billion Islamic bond to boost its Tier 1 capital ratio.

On July 1, Abu Dhabi Islamic Bank (ADIB) launched BusinessPulse, a portal aimed at providing advice and support to small and medium-sized businesses in the UAE. www.businesspulse.ae has three main sections: ‘Ignite’ is all about seeding the idea and kick starting the business plan; ‘Enrich’ is about funding the plan and ‘Grow’ deals with facilitating growth and future expansion. A key feature of the portal is a comprehensive library of case studies and videos from successful entrepreneurs. It also features a networking section that will enable SMEs to find the right business partners and contacts. Moreover, visitors can apply for a financing facility of up to AED 2 million through the portal and receive funding advice through interactions with ADIB’s Business banking team. BusinessPulse will be supported by a series of events and seminars, offering SMEs an opportunity to showcase their success stories and learn from others.

Dubai Duty Free (DDF) has successfully concluded the repricing of its $1.75bn debut facility arranged in 2012. The Repricing was well received by the market with support from its existing syndicate of international, regional and local banks, with several institutions also offering to increase their commitments as well as accepting the lower pricing. However, no new commitments needed to be allocated. Citibank, N.A., London Branch acted as sole co-ordinator and bookrunner for the Company in connection with this Transaction. DDF's goal is to increase sales this year to $1.8bn to grow sales to $3bn within five years.

The United Arab Emirates central bank has asked local commercial banks in the country to provide details of their financial exposure to Turkey by Tuesday. The aim is reportedly to review the investments. The UAE’s financial ties to Turkey have expanded in recent years because Gulf banks are looking to diversify out of the region’s oil-focused economy and are hamstrung by a lack of potential acquisitions at home. UAE banks have also increased their exposure to Turkish debt, particularly sukuk. Sales of Turkish sukuk to Gulf investors may increase further as Turkey expands its offerings. A new regulation limiting exposure to Turkey is not expected despite the UAE's central bank's action unless the data compiled exceeded the norm.

Nakheel made a net profit of AED1.2 billion (US$327 million) in H1 2013, a 57% increase on a net profit of AED767 million reported for H1 2012. Revenues for H1 2013 stood at AED4.23 billion, up 36% on revenues of AED3.1 billion noted in H1 2012. The results for H1 2013 reflect the on-going support of the Government of Dubai and the commitment by Nakheel to delivering the post restructuring plan. They also demonstrate the continuing growth and strengthening of the real estate market in Dubai, and the return of investor confidence and trust in Nakheel and its projects. Besides several Nakheel projects under development, the company is evaluating a number of additional projects. Moreover, Nakheel focuses on meeting its restructuring commitments to its stakeholders by making interest payments to bank lenders and profit payments to its sukuk holders.

Abu Dhabi Islamic Bank (ADIB) has closed a AED 1.32 billion (US$360 million) Syndicated Islamic Facility for Abu Dhabi-based Gulf Marine Services (GMS). ADIB acted as the Mandated Lead Arranger, Sole Underwriter, Sole Bookrunner, Investment and Security Agent for the facility. The deal was tailored by ADIB to meet GMS’ specific financing needs, including re-financing existing facilities and providing finance for the acquisition of 2 additional vessels. The financing will also help GMS achieve its plan to further improve and expand its fleet. The facility was very well received, as evidenced by the strong demand from local and regional banks which resulted in it being 2 times oversubscribed by 10 local and regional banks. White & Case acted as the legal counsel to the financiers, while Gibson Dunn acted on behalf of GMS.

The ebullient GFH Capital general counsel David Haigh speaks to Alex Newman about buying Leeds United, his unorthodox legal career and lofty political ambitions. When David Haigh recounts his first meeting with Ken Bates the anecdote reveals as much about himself as it does about the famously combative ex-chairman of Leeds United Football Club.

Dubai Islamic Bank (DIB) has announced the launch of the Al Islami FlexiBeta Dirham Certificate, a two-year Islamic certificate, providing investors with exposure to either emerging market equities or gold, depending on market conditions. The Certificate is issued by Oasis Certificate Programme Limited, a Special Purpose Vehicle that has been set up and sponsored by Citigroup to provide investors with a wide range of customised Shari'ah-compliant investment solutions. The certificate uses a framework comprising of observation of recent price trends and a forward looking risk indicator to adjust allocation between two asset classes, equities and gold. Investors will enjoy a capital protection without tying all their capital for the whole investment period. They will receive 90% of their total investment within two weeks of the issue date, with returns based on the full investment amount. The certificate is denominated in UAE dirhams with a minimum investment of AED 100,000.

Competitions for cash prizes as well as Islamic lectures will be part of the activities at the Sharjah Islamic Bank’s (SIB) Ramadan Tent this year. For the seventh consecutive year, from July 11 to 25, the tent will feature various religious awareness and entertaining programmes as well as engagement activities, delivered by an elite group of Muslim scholars and experts. As part of this year’s programme, SIB has prepared a wide range of cultural activities and competitions titled “Who will encash the cheque”, and allocated several cash and material prizes. There will also be a Quran recitation competition, a “Social Awareness Night”, a children’s night, an Emirati evening with religious singing, an evening dedicated to people with special needs and radio broadcasts on Sharjah Radio.

JPMorgan Chase & Co. is advising clients to buy Nakheel PJSC’s Islamic bonds as new projects boost the Dubai developer’s earnings, while government backing makes a default improbable. State-run Nakheel’s 4.27 billion dirhams ($1.2 billion) of sukuk yielded 9.88 percent at 12:30 p.m. in Dubai, down seven basis points this month, after surging 179 basis points in June. That’s more than twice the average gain in yields on corporate Islamic debt tracked by HSBC/Nasdaq Dubai indexes. JPMorgan listed Nakheel in a July 4 research note as its “top overweight recommendation” among Dubai real-estate debt. Nakheel will manage to pay or refinance as much as half of the $3 billion of debt due in 2016 as it generates at least $1 billion from new projects and land sales.