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The International Islamic Financial Market (IIFM) has released its IIFM Sukuk Report (3rd Edition) which consists of A Comprehensive Study of the Global Sukuk Market. The research report sheds light on the growth and development of international and domestic Sukuk issuances from 2001 - Jan 2013. According to Mr. Ijlal Ahmed Alvi, Chief Executive Officer of IIFM, the last two years were record years of Sukuk issuances. This year has also started on a positive note and the growth trend is expected to continue in coming years, he added. The report also highlights the different Sukuk structures used by international Sukuk issuers as well as Sukuk structures used at domestic level by various jurisdictions active in issuing Sukuk. Moreover, it contains selected Sukuk case studies in the international Sukuk market and the clarification on the meaning and types of Sukuk Al Istithmar (Investment Sukuk).

Goldman Sachs Group Inc. (GS), which is already providing Arcapita Bank $350 million in bankruptcy exit financing, is now seeking to give the Bahrain investment firm a $175 million bankruptcy loan that would pay off existing lender Fortress Investment Group LLC (FIG). Arcapita said the Goldman loan would pay off the $105 million still owed to Fortress and later convert into the $350 million exit loan that Goldman is already providing. With Arcapita obliged to pay off the Fortress loan by June 14, the company said it needs the Goldman loan approved at a hearing on June 10. Goldman, earlier this month, beat out Fortress in a war over who would provide the exit financing for Arcapita. Fortress's $150 million financing pact, arranged in December for Arcapita, was believed to be the first U.S. bankruptcy loan fully compliant with Islamic Sharia law.

According to the International Monetary Fund, Bahrain must urgently cut spending or risk unsustainable public debt as its fiscal deficit widens and oil prices decline. The smallest Gulf crude producer needs gradual fiscal consolidation equal to 7.7% of economic output over the next six budget years to contain its government debt at 40% of gross domestic product. IMF also recommended that Bahrain pare its fiscal stimulus to 0.9 percentage points of non-oil GDP from 2.1 percentage points. Bahrain’s outstanding debt including interest is about US$11.8 billion, with more than US$3 billion due this year. Moreover, investment in Bahrain’s private sector remains low, which may translate to non-oil growth of less than 4% in 2013. Bahrain is also vulnerable to oil price fluctuations.

BMI Bank , the Bahrain based associate of Bank Muscat , has announced that they have agreed in principle in favour of a merger with Al Salam Bank, an Islamic Bank incorporated in Bahrain. The completion of the transaction, including final share-swap ratio, is subject to satisfactory due-diligence as well as regulatory and shareholder approvals, Bank Muscat said in posting on the website of the Muscat Securities Market. Bank Muscat has a shareholding of 49 per cent in BMI bank.

Last week, Arcapita took on Tide Natural Gas Storage LP's contention that Arcapita's bankruptcy plan shouldn't be approved by a judge because of $70 million it says it is owed.The $70 million lies in an escrow account and stems from Tide's 2010 purchase of natural-gas storage facilities from an Arcapita subsidiary. Tide has been fighting for the money in U.S. district court in Manhattan for two years saying its claim to the $70 million shouldn't be placed behind the claims of other creditors. In its filing made last week, Arcapita says the $70 million claim by Tide should be subordinated to those of other creditors. The filing comes as Arcapita tries to finalize its exit from Chapter 11. Tide lawyers have said they will most likely fight the plan at a hearing next month.

Al Baraka Islamic Bank is raising $200 million through trust certificates in a Sukuk Al Wakala issue which will mature in 2015. The 18-month sukuk is aimed at raising cash to help increase the bank's exposure to Sharia-compliant trade finance. The issue is being promoted through a private placement with participants able to invest a minimum of $100,000. The purchase price for the certificates is 100 per cent of their face amount, plus an amount equal to 2pc of the face amount of the certificates for an agency. The certificates will not be listed or admitted to trading on any stock exchanges or markets. The bank expects a profit return on the certificates of 6pc over the 18- month period.

The International Monetary Fund’s (IMF) latest review of Bahrain points out that the size of the financial sector remains a key structural vulnerability of the banking sector. Stress tests indicate that the large wholesale segment is resilient to credit shocks, but there are pockets of vulnerabilities in the retail segment, particularly in Islamic banks because of their concentrated exposures to local and regional real estate. Risks in vulnerable banks could be ameliorated by the buildup of additional capital cushions through earnings retention. Planned adoption of the Basel III capital and liquidity frameworks, the designation of domestically systemically-important financial institutions, and moving the existing deposit insurance scheme to a pre-funded system should be considered.

Goldman Sachs International on Wednesday outbid Fortress Investment Group LLC to provide exit financing to Arcapita Bank BSC worth up to $350 million, money that will allow the Bahraini bank to meet outstanding obligations and work its way out of bankruptcy. U.S. Bankruptcy Judge Sean H. Lane noted that the bank was in the unusual position of having two institutions fighting over which would be able to provide the financing.

Tamkeen and Family Bank announced the launch of 'Mantoojati', a joint initiative aimed at enhancing the growth and sustainability of productive families in Bahrain. Through "Mantoojati", the beneficiaries will receive support to set up kiosks in selected shopping malls around the kingdom to market their products and services to a wider customer base. The support will be around BD6000 per applicant and will cover the cost of renting and setting up a booth. This will be complemented by the advisory services already provided to the beneficiaries by Tamkeen and Family Bank. According to Dr. Atef Elshabrawy, CEO of Family Bank, the programme seeks to encourage and motivate local and home-made goods and crafts, which the bank supports through funding and guidance.

Bahrain-based Al Baraka Banking Group (ABG) announced net income increased by 15 per cent to $66 million, and total operating income by 16 per cent to $233 million in the first quarter of 2013 compared to the same period of 2012. Total assets increased by 2 per cent and amounted to $19.5 billion. Total deposits including equity of investment accountholders grew by 2 per cent while total financing and investments remained unchanged at the end of March 2013 as compared with the end of December 2012. According to the group's CEO Adnan Ahmed Yousif, the good results are due to the bank's initiatives like introducing more innovative products, expanding the branch network of ABG subsidiary units, and entering new markets as well as modernizing and developing the group's infrastructures.

The Board of directors of Jordan Islamic Bank that is represented by Mr. Adnan Ahmad Yousif approved the financial statements of the 1st quarter of the current year. The Bank has achieved net profits after tax that amounted to $14.67m compared to $10.16m during the same period last year. Shareholders' equity at the end of the first quarter of the current year increased by 4.6% to reach about $336.95m. The Bank's assets with the managed accounts added to (restricted investment accounts and Muqarada bonds) amounted to about $4.67bn. Customers' deposits (including managed accounts) at the end of the 1st quarter of the current year reached approximately $4.200bn. Mr. Adnan Ahmed Yousif expressed his satisfaction over the results the Bank.

Bahrain-based Islamic investment bank Gulf Finance House (GFH) reported a 50 per cent increase in net profit at $1.5 million for the first quarter this year. Total income for the period was at $11.1m. Income was primarily from fees from funds under management and a profit of $4.9m from repurchase of debts at discount. The bank's strategy of streamlined operations continued to bear results with a 30pc reduction in operating costs for the current quarter at $8.3m compared with $11.9m in first quarter of last year. GFH acting chief executive Hisham Al Rayes said GFH Capital undertook due diligence on a number of potential strategic investors for Leeds United FC and exit arrangements for Mega City Navi Mumbai focusing on profitable growth.

Bahrain-based First Energy Bank (FEB) plans to build a $1 billion polysilicon production plant in Saudi Arabia with a local partner to cater to rising regional investments in solar power. The project is spearheaded by the strategic partner, FEB and the techno-commercial developer, Project Management and Development Company (PMD). It will cover a total area of approximately 375,000 square meters in Al Jubail Industrial City 2, and is expected to start production in 2013. The project will have a total production capacity of 7,500 tons per annum. It is expected that future expansion of the project facility (in second phase) would include investments in downstream sector. The project has achieved key milestones like the signing of the power supply agreement with Saudi Electricity Company (SEC).

Arcapita Bank has lined up $350 million in financing to take it out of Chapter 11 protection this summer. The Bahraini investment firm is seeking bankruptcy-court approval to move forward with a deal under which Goldman Sachs International will arrange and syndicate up to $350 million in financing, which court papers show will be structured to be compliant with Islamic Sharia law.

According to Omar Al Mardi, Managing Director, Bahrain Financial Harbour, Bahrain depends on direct foreign investment. However, when there is political instability there is risk of having little foreign investment. Bahrain Financial Harbour ("BFH") has recently signed a 7 year BD90.5 million (US$ 240 million) Ijara facility for the Financial Center Project with several banks. The transaction was subject to Shariah Law and to English law. With this financing, the intention is to complete the infrastructure systems and facilities in Bahrain and to support the businesses within the Financial Harbour complex to eventually become the business location of the choice in the Middle East, Al Mardi said. Within the next six months to a year BFH will seek new targets and projects, he added.

Shari’ah-compliant Al Salam Bank-Bahrain reported a net profit of BHD 3.053 million in the first quarter of 2013, up 68 per cent. The bank also reported a rise of 32 per cent in total operating income to BHD 6.184 million. Total operating expenses fell BHD 122,000 to BHD 2.63 million, mainly as a result of an 8.5 per cent cut in staff costs to BHD 1.38 million. Provisions and write-offs were BHD 501,000 against BHD 117,000 in the same period last year. Al Salam Bank-Bahrain reported total assets of BHD 989.293 million, up from BHD 942.218 million in Q1 2012. Total liabilities rose from BHD 715.877 million to BHD 766.633 million.

Liquidity Management Centre (LCM) has announced its results for the first quarter ended 31st March 2013. The insitution recorded a net profit of USD 1.427 million compared to a net profit of USD 0.511 million for the same period of the year 2012 resulting in a 179.25% increase in the net profit. The average interbank rate remains below 0.5%. Moreover, the total operating income recorded an amount of USD 3.181 million in comparison to USD 1.958 million for the same period in 2012. The positive results were due to various advisory services provided for transactions for Islamic Banks and corporations in the region and a portfolio of Sukuk and equities with a diversified investment approach. The Bank's balance sheet witnessed significant improvement in quality and liquidity. Furthermore, the Shareholders' equity increased by 2.7% during the same period.

Arcapita Bank yesterday announced that a US court has approved the disclosure statement for the amended Chapter 11 plan of reorganisation. The court's decision relates to the adequacy of the disclosures in the disclosure statement about the company and the plan, and the process for voting on it. In early May, the plan will be submitted to creditors for a vote, and following this, presented to the US court for confirmation. A hearing to confirm the plan has been scheduled before the US court for June 11. The provisions of Chapter 11 allow the filing companies to continue to operate their businesses and manage their properties under the direction and control of their boards and management.

Bahrain-based Al Baraka Bank wants its new five-year global expansion strategy to put more emphasis on Africa, particularly North Africa. The bank already has ventures in the Middle East, Asia and Africa. Its goal is to grow group assets and income almost twofold in the next five years. This five-year expansion plan will certainly include investments in Libya and Morocco. The bank could splurge up to $100 million this year in Libya. In Morocco, the financial services firm will launch a separate operation with a $100 million initial capital outlay within 12 months. Moreover, the group is thinking about having an Al Baraka Bank Africa brand presence.

Global Banking and Finance Review has announced Medgulf Allianz Takaful BSC (c) as the winner of the award 'Best Bancassurance Distribution Network Bahrain 2013'. The award honours the company's distribution network and regional presence. Medgulf Allianz Takaful was selected by the judging panel of Global Banking & Finance Review considering quality, performance and community commitment.