IslamicFinance.de

The Bahrain-based Al Baraka Banking Group (ABG) has obtained the approval of the Bank Al Maghrib (the central bank of Morocco) to establish a new bank in Morocco. The Group is now represented in all countries in the Maghreb. The Group now owns banking subsidiaries in Algeria, Tunisia, Libya and Morocco, as well as the African continent in Egypt, Sudan and South Africa. The Group has already obtained the approval of the Central Bank of Bahrain to establish the Morocco bank and will carry the name of Al Baraka Bank Morocco. The new bank will be under the management of Al Baraka Banking Group and will operate within its network of subsidiary banking units, which are currently located in 15 countries and in turn own more than 700 branches.

Five Islamic banks are set to open in Morocco after Bank Al-Maghrib, the country’s Central Bank, approved five applications. A further three banks have been given permission to sell Islamic products. A Shari’ah committee which will govern all Islamic finance activities will also be established. The five banks are: CIH Bank in partnership with Qatar International Islamic Bank; BMCE Bank of Africa jointly with the Saudi/Bahraini group Dalla Al Baraka; Banque Centrale Populaire with the Saudi group Guidance; and Crédit Agricole du Maroc in partnership with the Islamic Corporation for the Development of the Private Sector (ICD). Attijariwafa Bank is currently in talks about a future partnership. Banque Marocaine du Commerce et de l’Industrie, Crédit du Maroc and Société Générale have all been given the green light to sell Islamic products.

The Federal Board of Revenue has proposed Shariah-compliant criteria for companies whose shares are traded on a stock exchange to avail the reduced rate of tax under Income Tax Ordinance 2001. According to the SRO.1173(I)/2016 issued by the FBR, the Board has proposed amendments to the Income Tax Rules, 2002. To avail reduced rate of tax, the FBR has proposed Shariah-compliant criteria for a company whose shares are traded on a stock exchange.

Firstly, the business of the company should be Halal i.e. it shall not include processing or manufacturing of pork, liquor, non-Halal products, pornographic material or any other activity not permitted by Shariah. Secondly, there should be Riba-free (interest-free) financing on the balance sheet of the company; however, the company may be leveraged through Islamic modes of financing obtained from licensed Islamic financial institutions.

Thirdly, all the investments made by the company should be one hundred per cent Shariah compliant; therefore, it would not be permissible for the company to acquire non-Shariah compliant instruments/securities which yield interest or income that is not Halal.

The Christian Association of Nigeria (CAN) on Thursday condemned the appointment of the governor of Nigeria’s central bank as leader of the International Islamic Liquidity Management Corporation (IILMC). In a statement by CAN’s president, Samson Ayokunle, the association described the appointment of Godwin Emefiele as the IILMC chairman, as unconstitutional and totally unacceptable.
According to CAN, the government’s decision to accept the appointment amounted to denouncing Nigeria as a secular state, in negation of section 10 of the 1999 constitution. “There have been reports that the IILMC recently appointed the Governor of Central Bank of Nigeria (CBN), Mr. Godwin Emefiele as its Chairman during its 17th Governing Board meeting in Jakarta, Indonesia. “Section 10 states that The Government of the Federation or a State shall not adopt any religion as State Religion. This action by Nigeria’s government is in clear negation of the constitution, especially this section,” the statement said. The association re-emphasised its earlier allegation that the Nigerian government plans to make the country an Islamic state.

#Malaysia Building Society Bhd (MBSB) has received Bank Negara’s approval for talks on a proposed merger with Asian Finance Bank (AFB). MBSB will soon start negotiations with the existing Middle Eastern shareholders of AFB, namely Qatar Islamic Bank (66.67%), RUSB Investment Bank (16.67%), Tadhamon International Islamic Bank (10%) and Financial Assets Bahrain (6.67%), for the merger. The negotiations are to be completed within the next six months. For the nine months ended Sept 30, 2016, AFB reported a net profit of RM4.54 million, an 18.8% drop compared with RM5.58 million in the same period last year. MBSB has a goal to become an Islamic financial institution by 2020 through merger with an Islamic lender. It centres his business efforts on six areas, namely, business focus, right pricing, asset quality, cost cutting, retail collection and information technology initiatives.

Emirates NBD has launched the new edutainment mobile simulation game Banki in its efforts to promote financial literacy in the #UAE. Banki will target the country’s youth to become economically aware at a young age and consider careers in the banking and financial services sector. Banki allows users to play five engaging games that help them understand the concept of savings, trading, simple financial transactions and digital banking. They can learn about the basics of banking products, financial services, stock markets, economics and additional topics aligned to the Ministry of Education’s curriculum. Husam Al Sayed, Chief Human Resource Officer at Emirates NBD said the launch of Banki aims to communicate the benefits of being financially literate to the next generation of customers. Available on both the Google Play and Apple stores, the edutainment game can be downloaded for free and can be used by registering with an email ID.

Qatari banks Masraf Al Rayan, Barwa Bank and International Bank of Qatar have begun initial talks for a potential merger. This deal would create the Gulf state's second-largest bank and it would have assets worth more than 160 billion riyals ($44 billion). If the deal goes ahead, it would be a rare example of consolidation among banks in the Gulf, which have previously been reluctant to tie up. The previously lavish state spending is now being trimmed to adjust to lower oil prices and the argument for consolidation is now more compelling. Though negotiations have begun, there is no guarantee any agreement will be reached. The proposed merger of Rayan, Barwa and IBQ depends on financial and legal due diligence, as well as securing approvals from regulatory authorities and shareholders of all three banks.

Bahrain-based Bank Alkhair has obtained approval from the State Bank of Pakistan to sell its stake in Pakistan’s Burj Bank to Al Baraka Pakistan Limited (ABPL). This transaction follows the announcement on 5 September 2016 about the merger of Pakistan’s Burj Bank and ABPL, creating an institution with assets totaling more than $1.1 billion. Ayman Sejiny, Group CEO of Bank Alkhair said the bank was pleased to sell its stake in Pakistan’s Burj Bank to Al Baraka Pakistan Limited. Bank Alkhair has completed several landmark transactions since its inception, including the establishment of t’azur, a regional Takaful company and the acquisition of Bahrain Financing Company, the oldest foreign exchange and remittance houses in the GCC.

Iran and Venezuela inaugurated a joint bank to finance their development projects. The opening ceremony took place in Tehran during a visit by Venezuelan President Hugo Chavez. The Tehran based Iran-Venezuela Joint Bank has an initial capital base of 200 million dollars, with each nation providing half of the funds. The Export Development Bank of Iran, which is under sanctions from the US Treasury, was tasked with creating the joint bank. The joint bank will work within Iran’s banking regulations and its activities will be overseen by the Islamic republic’s Central Bank. The board of directors comprises four Iranians and four Venezuelans. A joint investment fund will also be launched in Venezuela.

Dawood Islamic Bank Limited (DIBL) has received Rs1 billion (US$12.9 million) investment from Bahrain-based Unicorn Investment Bank Limited. Unicorn already had a 22.2% equity stake in DIBL prior to the current investment. Unicorn Managing Director Aamir Khan said that the decision to invest in Dawood Islamic Bank is based on excellent opportunities that are available in the Islamic banking sector of Pakistan. DIBL Chairman Rafique Dawood said the investment by Unicorn would further boost the bank's ability to provide support to trade and industry through its various Riba-free banking products. DIBL has a network of 21 branches spread over the major cities of Pakistan including Karachi, Lahore, Islamabad, Faisalabad, Multan, Sialkot, Iqbalabad and Joharabad.

The assets in #Bahrain’s Islamic banking sector have risen from $1.9 billion in 2000 to $25.1 billion in 2015 and account for around 13% of the kingdom’s total banking assets. According to Director & Group CEO of Al Salam Bank-Bahrain, Yousif Abdulla Taqi, the bank is particularly appealing to a growing number of international clients. Investors are attracted to Islamic finance products for various reasons such as: diversification, ethical investments and asset-based investments. Al Salam Bank-Bahrain (ASBB) has a 6% market share of total Bahraini bank financing. The bank recently signed an agreement with Eagle Hills Diyar and Diyar Al Muharraq to set up an escrow account for the real estate development projects in the kingdom.

In #Turkey the insured participation funds at the Bank Asya are being paid to the rights holders through the state-owned Vakif Participation Bank. On May 29, 2015, the Banking Supervisory and Regulatory Authority (BDDK) ruled for a complete takeover by the Savings Deposit Insurance Fund (TMSF) of all Bank Asya shares. According to yesterday's announcement, up to TL 100,000 ($28,247) of the total of insured participation funds at the Asya Participation Bank have been paid to the right holders in Turkish liras. The banks operating permit has been abolished. It was put on sale by the Fund Board, but did not receive any offers despite the extension of the bidding period.

In #Kenya the Sharia-compliant lender First Community Bank (FCB) has laid off a third of its workforce as effects of the recent capping of interest rates continue to shake the banking industry. The lender’s staff costs stood at Sh241.4 million as at June 2016 which rose to Sh365.2 million at the end of September, prompting action by the bank’s management. The bank, which received a regulatory approval in May 2007 to start Sharia-compliant banking, last week reported a 16.2% jump in quarter-three net profit to Sh74.4 million. FCB is one of four banks that recently announced staff cuts as a reaction to the biting interest regulations on loans and deposits. The other three banks are Sidian Bank, Family Bank and Ecobank.

Nigeria-based Jaiz International Bank has won three awards at the 6th Global Islamic Microfinance Forum (GIMF) organised by Centre of Islamic Banking and Economics in Nairobi, Kenya. The organisation and its associated institutions, Jaiz Charity and Development Foundation, Jaiz Takaful Insurance, Jaiz Zakat and Waqf Trust Fund won the awards. The awards are Lifetime Achievement Award bestowed on the Chairman of Jaiz Foundation, Alhaji Umar Abdul-Mutallab, CON; Best Corporate Social Responsibility Award to Ambassador Adamu Babangida Ibrahim, Director General/CEO, Jaiz Charity and Development Foundation and The Best Rising Islamic Microfinance Personality Award was awarded to the Managing Director of Jaiz Takaful Insurance, Mr. Momodou Musa Joof.

Abu Dhabi Islamic Bank Egypt announced its board of directors has appointed Fareed Farouk Al Bilbisi as acting chairman, and Zuhair Hamada Idris as acting chief executive officer of the bank. The statement comes after the death of ADIB Egypt’s chief executive officer, Nevine Lotfy, who was found murdered in her home on Tuesday. Lotfy, whose murder is currently being investigated, became managing director and CEO of ADIB Egypt in 2008.

An unknown group of people have purposefully leaked new allegations surrounding the Turkey-based bank Kuveyt-Turk. A press release published on Nov. 19 claimed that US Senator Dick Durbin would hold hearings to investigate two key banking institutions in Kuwait and whether they helped fund terrorism. The press release read that Durbin would target Kuwait Finance House and its subsidiary in Turkey, the Kuveyt-Turk participation bank. A spokesman at Senator Durbin's office flatly denied the report and said it was completely false. The fake report has surfaced amidst an ongoing court case in California against the two banks on the terror funding charges. Kuveyt-Turk's lawyers dismissed the charges by saying the allegations have no merit because banks are not responsible for the allegations. President Recep Tayyip Erdogan said the allegations over Kuveyt-Turk and Kuwait Finance House were proof of Western double standards.

#Pakistan's Islamic banks are introducing new products and adjusting policies to take advantage of government incentives designed to boost growth in the industry. Shariah-compliant banks in the country held 11.4% of total banking assets in June, which is well below levels of around 25% seen in Gulf Arab states. To change this, the government introduced a 2% tax rebate for shariah-compliant manufacturing firms in July to encourage them to eliminate interest-bearing debt from their balance sheets. Abdullah Ghaffar, head of investment banking at Al Baraka Bank Pakistan, said he detected signs of an increase in demand for Islamic financing. According to Syed Abubakr, sharia board member of Emaan Islamic Banking, there is some demand for new products from conventional banks planning to convert their operations into fully-fledged Islamic banks.

The #Philippines' House committee on banks and financial intermediaries has approved the measures that would pave the way for the expansion of Islamic banking in the country. The new House Bill amends the Philippine’s lone Islamic bank, the Al-Amanah Islamic Investment Bank to regulate and organize an expanded Islamic banking system in the Philippines. Former president Gloria Macapagal Arroyo said the enactment of the measure was very timely as this would help the country’ growth inclusive and sustainable. The consolidated proposal will make the Al-Amanah independent from the Development Bank of the Philippines, be a universal bank with initial paid up capitalization of P10 billion and will be the first in the country to fully engage in Islamic banking that can issue sukuk.

Iran has established correspondent relationships with 230 foreign banks since January 16, following the implementation of the nuclear deal. In addition, Iran's Ministry of Economic Affairs and Finance reported that the Export Development Bank of Iran (EDBI) has begun brokerage relations with numerous banks around the world. This includes 64 banks in 20 European countries, 36 banks in 17 Asian states, four banks in Africa as well as one bank in Latin America. However, the Islamic Republic complains that it still does not have access to global financial markets. Many international banks still shy away from financing trade deals and processing transactions for fear of US penalties.

The CEO of the Abu Dhabi Islamic Bank Nevine Loutfy was found murdered at her home in Cairo. An investigation and forensic team arrived at the murder scene shortly after the incident. With over three decades of banking experience, Loutfy had a diverse background and had worked across the corporate, SME and retail sectors. She had extensive international experience gained in the US, Europe and emerging markets. Nevine Loutfy was the first ever female head of an Islamic bank.