IslamicFinance.de

Family businesses must adapt faster, innovate sooner and become more professional in the way they run their operations if they are to remain successful. These are some of the findings of the second PwC survey of 44 family firms in the Middle East, titled The family factor: Professionalising the Middle Eastern family firm. Overall, this year’s survey indicates that family firms remain dynamic and resilient. Indeed, family businesses in the Middle East have been markedly more successful than their global counterparts. Middle East family businesses are also more ambitious in the medium term. The report can be downloaded at www.pwc.com/familybusinesssurvey.

Kuveyt Türk Participation Bank has been licensed by the Federal Financial Supervisory Authority (BaFin) to offer banking services in Germany. Thus, the first bank based on an interest-free Islamic business model is licensed in Germany.

Kuveyt Türk has obtained its license from the Federal Financial Supervisory Authority (BaFin) to provide fully-fledged banking services in Germany according to the interest-free Islamic banking principles. Kuveyt Türk is the first Islamic bank that has been fully licensed to operate its deposit and debt business in Germany. With this license, Kuveyt Türk is the pioneer that introduces the Islamic banking model in Germany.

KT Bank AG with headquarters in Frankfurt am Main and as a 100 percent subsidiary of Kuveyt Türk Participation Bank, will start to offer its reliable, high-quality, fast and user-friendly services from July 01, 2015 onwards. KT Bank AG will provide its private and commercial clients with products and services according to interest-free Islamic banking principles.

“KT Bank AG is an ethical, innovative and socially responsible bank”

Turkey's Capital Markets Board has approved issuance of ringgit-denominated Islamic bonds by Turkiye Finans Katilim Bankasi and a debut lira-denominated deal by Zorlu Energy. Islamic lender Turkiye Finans will raise up to 2.05 billion ringgit ($553.7 million) via sukuk, issued by its wholly-owned unit TF Varlik Kiralama. Separately, Zorlu Energy received approval to raise 100 million lira ($38.4 million) via sukuk. So far the bulk of sukuk issuance has come from the government and the country's four Islamic banks. Islamic lender Kuveyt Turk also plans to issue a debut sukuk in the Malaysian market, through a 2 billion ringgit programme.

Bank Muscat's shareholders have approved the Board's recommendation for the setting up of a RO 500 million (or its equivalent in US Dollar currency) Meethaq Sukuk Programme for the issuance of sukuk in various tranches in the domestic and international markets through public subscription or private placement. The Sukuk tranches under the Meethaq Sukuk Programme will be in different amounts, maturities, and profit rates, issued on different dates with varying terms and conditions of subscription. All Sukuk will be issued within five years. Approval was also given to the Board's recommendations to issue convertible bonds.

The decision of State Bank of India (SBI) to put off the launch of a Shariah-compliant equity mutual fund has once again sparked debates on whether India should open doors to the concept of Islamic finance and facilitate a market for Shariah compliant financial products. The fund was designed to invest in Shariah compliant companies. Dinesh Kumar Khara, managing director and CEO of SBI Mutual Fund, said that SBI’s decision to defer the fund launch, originally planned in December, was a commercial call. On the other hand, Congress' member K Rahman Khan said in Parliament that the decision was due to political intervention.

Russian lawmakers have introduced to parliament a draft bill to support Islamic finance, aiming to attract capital inflows at a time when an economic slowdown is intensifying and Western sanctions show no sign of being lifted. The draft law, sent to parliament's lower house, the State Duma, this week, proposes allowing banks to engage in trade activities, a concept central to many of the structures used in sharia-compliant financial products. While many other obstacles remain, the bill is seen a first step to spur development of the sector. The draft law must pass three readings in the Duma before it moves to the upper house and then to President Vladimir Putin's desk to be signed into law.

Nigeria and Ivory Coast are looking to emulate Senegal's successful move into the market for Islamic bonds, Khaled Al-Aboodi, head of the Islamic Corporation for the Development of the Private Sector (ICD), said. The ICD helped arrange Senegal's debut 100 billion CFA francs ($208 million) Islamic bond, also known as sukuk, last June. Al-Aboodi added they were exploring with Nigeria and Ivory Coast. The issuance by Senegal has opened up the whole region, he said. The ICD hopes to support at least two countries in 2015 to issue a sukuk. Meanwhile, Niger has signed up for a sukuk programme worth 150 billion CFA francs ($260 million), although the timing has yet to be determined.

The High Sharia Supervisory Authority held its inaugural meeting at the Central Bank of Oman HQ in Muscat with Sheikh Dr Kahlan bin Nabhan Al Kharoosi, Sheikh Dr Abdullatif bin Mahmood Al Mahmood, Dr Said Bouheraoua, Ahmed Suhaimi bin Yahya and Dr Yaqoob bin Mohammed Al Waily in attendance. The formation of the High Sharia Supervisory Authority is considered pivotal to the CBO's efforts to introduce Islamic banking to Oman in a way that is likely to match demand. Both standalone Islamic banks as well as Shari’ah compliant windows are allows in Oman, unlike neighbouring Qatar.

Chief Executive of Islamic Corporation for the Development of the Private Sector (ICD), Khaled Al-Aboodi, says Nigeria and Ivory Coast are looking to emulate Senegal's successful move into the market for sukuk. Senegal, meanwhile, is discussing another sukuk after the ICD helped it arranged its debut $208 million Islamic bond last June. Nigeria's neighbour Niger has signed up for a sukuk programme worth 150 billion CFA francs ($260 million), although the timing has yet to be determined. Al-Aboodi said they hoped to issue the sukuk before the end of the year, adding that the tenor depended on its structure and investor appetite.

The Japan International Cooperation Agency (JICA) and the government of Jordan will begin work in the coming weeks on a debut issuance of Islamic bonds. In October, JICA signed an agreement with the Islamic Corporation for the Development of the Private Sector (ICD), to develop its Islamic finance capability. Jordan is JICA's first target. JICA and ICD will start their joint technical assistance to the country within a month, Tetsutaro Kon, director in charge of Middle East operations at JICA, said. The consultation would continue over the next six months and address details such as currency and tenor of the sukuk.

More than US$718 million will be invested in roads, power generation, water supply, sanitation, agriculture and rural development projects in a number of countries after the Islamic Development Bank (IDB) approved a funding partnership with the Bill and Melinda Gates Foundation. The projects will be in Turkey, the Sultanate of Brunei, Uganda, Uzbekistan, Cote d'Ivoire and Benin. Technical assistance will also be given to projects in Bahrain. The first tranche of funds under the agreement will see $100m worth of grants issued before the end of this year. Operations are expected to begin in 2016.

Oman's Bank Nizwa has launched a pioneering educational platform entitled 'Islamic Finance Knowledge Series', which aims to raise the community's awareness about Islamic banking across Oman. Jamil El Jaroudi, the bank's chief executive officer, noted that the new initiative is seeking to address the misconceptions about the concept of Islamic banking. El Jaroudi said that one mistaken belief is that it is more expensive to obtain financing from an Islamic bank than a conventional bank, which is not necessarily true. The sessions of the series will be delivered to both the public and private sector individuals, as well as college and university students.

Al Rayan Bank PLC, formerly known as Islamic Bank of Britain (IBB), has announced the appointment of Tim Sinclair as senior head of marketing and retail sales at its Birmingham office. Sinclair has played a role in the realignment of the bank’s sales channels, towards a more direct model. This has been achieved by developing the bank’s online capabilities, resulting in a 439% growth in direct sales between 2011 and 2014. Sinclair has also championed several research projects, which have helped Al Rayan Bank to develop a clearer understanding of the British Muslim consumer and business marketplace, a previously under researched area.

Life insurer AIA Bhd sees a huge growth opportunity in the family takaful business and investment-linked products in Malaysia, a market viewed by the industry as being relatively under-insured compared with its more developed neighbours. To tap into this growth opportunity, chief executive officer Bill Lisle said that the group, which is in the midst of completing its integration with ING Group’s domestic insurance operations, plans to employ more full-time agents and leverage on new technology. He added that the company would leverage on its Point of Sale (iPoS) technology driven by iPad.

Fast-paced economic growth in Qatar is supporting the takaful sector along with a keenness from policy makers to support the insurance market. At the same time, most of the mainstream takaful and retakaful companies in the region are currently undervalued compared to other sectors of the economy. Year 2015 continues to hold high hopes for takaful in Qatar and promises increased market penetration. However, sector executives appear not to be optimistic, with the Qatar Financial Centre’ Mena Insurance Barometer reporting that only 21% of participants expect the takaful segment to outgrow total insurance premiums in the next twelve months in 2015 same as in 2014, but compared with 32% in 2013.

Fundamental change is only achieved by a congruence of change, both from the bottom, and from the top, a double reconfiguration of classes to a new system. Socialist proposals cannot account for this. The owners of capital have zero interest in such a radical change of ownership, while the workers cannot point to any successful alternative patterns that could form the basis of a new society, instead having to opt for radical but unproven social experiments. The key problem therefore was that it could not point to any other proven alternative that would be more productive, and elicit congruent change both from the top and from below.

In a speech marking the end of a three-day economic conference, Egypt's president Abdel Fattah Al Sisi reiterated his commitment to peace and growth as he sought more investments from the international community, after receiving commitments worth billions of dollars. Egypt signed investment deals worth more than $138 billion on the first two days of the conference, while its Arab Gulf neighbors—Saudi Arabia, Kuwait and the United Arab Emirates—pledged another $12 billion to help stabilize its economy. But Mr. Sisi, in his concluding remarks, said his country would need a lot more, as much as $300 billion over the coming years, to make its economy strong enough to give its vast population a genuine chance to prosper.

According to the recently released “Global wealth management outlook 2014-15: New strategies for a changing industry” by Strategy&, the GCC has been the most consistent of the emerging markets, recording growth of 16 percent or more each year since 2010 and doubling total private wealth from $1.1 trillion to $2.2 trillion for an overall compound annual growth rate (CAGR) of 17.5 percent. The UAE led the GCC countries with 25 percent CAGR, followed by Oman (21 percent) and Bahrain (18 percent), which grew from much smaller bases. Not surprisingly, high-net-worth individuals (HNWIs) continue to account for the largest chunk of the region’s wealth at 41 percent.

In celebration of Global Money Week (GMW), SEDCO Holding Group is organizing the Second Financial Dignity Summit under the theme — Money and business — on March 17, in King Abdulaziz University (KAU). The summit will encompass several activities around financial dignity to raise awareness about saving and budgeting. The week-long summit has already simultaneously begun on March 10, during GMW. The summit agenda includes presentations by local successful entrepreneurs. During the summit, 5 shortlisted candidates for the Riyali Young Entrepreneurs’ award will be presenting their projects for a chance to win a substantial financial prize.

Qatar has called for a global regulatory framework for the industry, saying it is needed to ensure the sector's stability. An important task of the authority would, naturally, be to collect data on credit risks of Islamic financial institutions so that those risks could be identified, said the Governor of Qatar Central Bank (QCB). There are certain high-risk areas in the Islamic banking and financial sector and they, for example, include real estate and consumer lending to certain categories of people, H E Abdullah bin Sauod Al Thani said. Efforts have indeed been made to diversify Islamic financial products, but they are not enough.