IslamicFinance.de

IdealRatings Inc. has announced the launch of the first ever Sukuk Shariah Screening Solution. The research-based online screening service is designed to serve Islamic investors and treasuries aiming to balance their portfolios with low risk fixed income instruments yet conform to the mandates defined by their Shariah boards. The Sukuk Screening Solution enables investors to screen Sukuk against different Shariah guidelines in the market such as AAOIFI, OIC, Malaysia Securities Commission (SC) as well as defining their own custom composite Shariah guidelines. IdealRatings has also designed and launched a series of Sukuk indexes, to empower the Sukuk service clients with benchmarks essential for Islamic fixed income portfolio management. The Index Family constitutes Five US Dollar indices with different segmentations.

Dubai Islamic Bank has ruled out seeking a controlling stake in Bank Panin Syariah, and its plans are limited to raising its stake in the Indonesian lender to 40 percent from 25 percent now, its chief executive Adnan Chilwan said. Dubai Islamic bought 2.42 billion shares in the listed sharia-compliant lender in June, its first foray into southeast Asia. In May, the bank said it hoped to reach 40 percent before the end of the year, using its own cash to fund the purchase. Under Indonesian rules, foreign ownership of local lenders requires regulatory approval to go above 40 percent. Last month, Indonesia's financial services authority said it was preparing a five-year industry blueprint that would address foreign ownership limits.

Kazakhstan's Al Hilal Islamic Bank may expand into neighbouring countries as legislative efforts to develop Islamic finance gather pace across the region. Legislation is being redrawn in Kazakhstan, after the first set of Islamic finance rules in 2009 failed to spur much activity. Almaty-based Al Hilal, whose parent is wholly owned by the Abu Dhabi government, is considering increasing its geographical presence as part of its 2015 business plan, chief executive Prasad Abraham said. A draft amendment, currently awaiting discussion in Kazakhstan's parliament, would provide the bank with a clearer framework that could translate into better commercial opportunities, Abraham said.

Bank Muamalat Malaysia Bhd expects to launch Islamic Private Banking within a year to cater to the growing demand for the service. Chief executive officer Datuk Mohd Redza Shah Abdul Wahid said the bank is currently studying the product concept and expected to complete the framework in the next six months. Mohd Redza signed a memorandum of understanding with the Bank of London and the Middle East to penetrate the new segment in a wholesome approach. He also said that the Bank of London and the Middle East had the expertise in dealing with private banking customers, therefore it was a good opportunity for Bank Muamalat to work together with the bank.

The creation of a mega Islamic bank must fulfill the objectives of being able to undertake international business and facilitate cross border financial flows, said Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz. She said that such a mega bank must also be able to support international trade and cross border investment activity. She was responding to a question about the license for the proposed mega Islamic bank as a result of a merger between CIMB Group Holdings Bhd, RHB Capital Bhd and Malaysia Building Society Bhd. Dr Zeti said Bank Negara wanted to see the internationalisation and enhancement of Malaysia’s financial and economic connectivity with other countries.

Islamic banks can offer customers spot value date transactions, which are for settlement in two working days, or at a pre-agreed date and price in the future, which would be covered under the "foreign exchange wa'ad". Islamic foreign exchange swap is a contract that is designed as a hedging mechanism to minimise market participants' exposure to volatile and fluctuating market of currency exchange rates. The FX swap involves two stages of exchange at the beginning when the first currency exchange takes place and the dollar or other currency is converted to the other currency based on the spot rate. On the same day, both sides will sell a forward contract to other currency back to the dollar or other exchanged foreign currency at a forward rate.

A revival of international bond issues from the Gulf is set to draw heavy demand from local and foreign investors, despite the latest geopolitical upheavals in the Middle East and the approach of higher US interest rates. Gulf bond issuance has dried up since early July, because of a traditional summer lull in local investor activity as well as global market instability due to the crisis in Ukraine. But the vast majority of investors have decided that the geopolitics do not come close to posing any existential threat to the rich Gulf Co-operation Council economies. More than geopolitics, the biggest threat to the Gulf’s primary bond market may be expectations for US interest rates. The currency pegs mean eventual US rate hikes are expected to feed through into official Gulf interest rates quickly.

A delegation of the Qatari Businessmen Association (QBA) visited Kenya last week to enhance bilateral business relations between the two countries and open up new areas of investment. The delegation was headed by Sheikh Dr Khalid bin Thani bin Abdulla al-Thani, second deputy to QBA chairman and Ezdan Holding chairman. The delegation included Ezdan Holding CEO Ali Mohamed al-Obaidly and Vodafone Qatar CEO Kyle Whitehill among other businessmen and QBA members. The delegation was received by Kenya’s Minister of Foreign Affairs and International Trade, Amina Mohamed, who brought them together with senior officials from the Kenyan Ministry of Foreign Affairs and members of Kenya’s business community. Sheikh Dr Khalid said Kenya has become a promising and attractive business environment.

The Islamic banks in Qatar outpaced conventional banks in the country in terms of growth in net profit during the second quarter of 2014 (Q2,14). Qatar Islamic Bank (QIB) reported a 15.0 percent YoY bottom-line growth in Q2 14, mainly due to improvement in top-line as well as fee income. Masraf Al Rayan reported 12.1 percent YoY growth in its bottom-line due to strong growth in net financing income, Global Investment House (GIH) noted in its Q2, 14 “GCC Banking Sector” analysis. The GIH analysts who covered five major Qatar-based banks said the loan books of banks in Qatar grew the most in the region, by registering 15.4 percent growth on year-on-year basis, followed by the banks in Saudi Arabia (9 percent), UAE (4.8 percent) and Kuwait (4.6 percent).

International credit rating agency Moody's has downgraded the long-term deposit rating of Turkey’s Bank Asya to Caa1 from B2, placing the note on review against any further deposit volatility at the bank. Bank Asya's financial strength was also adjusted downward. According to Moody's statement, the downgrade reflects increasing external pressures that may exacerbate the bank's deposit volatility, which has already shown evidence of significant outflows this year. Depending on the existent deterioration of the bank's financial fundamentals, the bank would need to receive external support, and it would face higher potential losses in case of a deterioration in the quality of the bank's assets and its ability to pay its depositors, Moody's also said.

The Obama administration unveiled a host of new sanctions Friday against more than 30 companies and individuals doing business in or with Iran, seeking to thwart that nation’s nuclear ambitions, its support for organizations the United States deems as terrorist groups and mute its support for the embattled regime of Syrian leader Bashar Assad. The sanctions come at a period where the United States needs Iran’s help in trying to defeat the Islamic State (ISIS). Friday’s additions to the list include more banks, providers of equipment to Iran’s state oil company, banks that help to funnel U.S. currency to Iran’s central bank and transport-related businesses that have helped the Syrian and Iranian governments.

Al Baraka Bank Pakistan aims to play an active role in social and economic development, by way of contributing to secure the welfare, balance and solidarity of financially and socially challenged segments. Setting the ethical standards for a sustainable society A Group of Volunteers from Al Baraka Bank spent a day, celebrating the Independence Day, with the Children at The Citizens Foundation (TCF) School. Concluding the ceremony, Gift hampers were distributed amongst the attending children. Al Baraka is a sponsor of The Citizen’s Foundation (TCF) Schools. Development of Education sector, through various activities and funding is one of the primary concerns of Al Baraka, in the longer run.

Takaud, the Bahrain-based specialist savings and pensions provider for the MENA region, has announced the appointment of an experienced sales management team, which will be based in Bahrain. The new appointments include Loay Ragheb as Chief Distribution Officer and Jason Reeves and Nabil Karameh both as Senior Managers responsible for regional distribution. Eric Van Biesen, Acting Chief Executive Officer TAKAUD, said, that the new appointments underpin the company's focus on expanding direct and third party distribution channels (banks, financial intermediaries, professional consultants), in order to support the on-going rollout of innovative savings and pension solutions for both Retail and Corporate clients across the region.

A new guide by the World Wide Fund for Nature (WWF) has been launched to help banks in Singapore implement environmental, social and governance (ESG) practice into their frameworks and develop sustainable solutions to risks of climate change and resource scarcity. The ESG Integration for Banks: A Guide to Starting Implementation gives advice to financial advisors and lenders in socially responsible banking. The guide maps out ‘how to’ steps for financial institutions in the earlier stages of their ESG journey. It shows them how to manage their risk exposure to unsustainable business practices and lead the trend toward green business.

Kuwait’s Burgan Bank has chosen banks to arrange meetings with investors ahead of a potential issue of a capital-boosting bond. The lender will hold roadshows in Asia, the United Arab Emirates and Europe from Sept. 4, with a bond issue that enhances the bank’s Tier 1 capital ratio to follow, subject to market conditions. Should the US dollar-denominated bond issue happen, it will have a perpetual lifespan and be of benchmark size. Burgan Bank’s chief executive, Eduardo Eguren, said in March that the lender wanted to raise its capital before the end of the year to help it comply with Basel III guidelines, with perpetual bonds a potential route. The investor meetings will be arranged by HSBC as global coordinator and Citi, JPMorgan and National Bank of Abu Dhabi as lead managers.

The South African government plans to raise at least $500 million in its first issue of Islamic bonds, a Treasury official indicated on Thursday. Five years is the most popular tenor for major international sukuk issues, and South African officials said last year that the country was leaning towards that tenor for its U.S. dollar-denominated sale. The government has said it was issuing a sukuk in order to diversify its fund-raising. It has hired BNP Paribas, Standard Bank, and KFH Investment, a unit of Kuwait Finance House, to handle investment meetings in Europe, Asia and the Middle East starting on Sept. 8. A sukuk issue may follow but the timing will depend on market conditions.

Harris Irfan is an insider on two fronts. He is a Muslim and also an expert in finance and commerce. He has worked as an investment banker in Europe and the Middle East and been head of Islamic finance at Barclays; he also founded Cordoba Capital, an Islamic finance advisory firm. Mr Irfan wants to show that Islamic finance might be able to make a real contribution to our economic woes. He asks the reader to consider whether the Islamic world can bring something of benefit to the Western world, and vice versa. While this book isn't full of jargon, it helps to know something about how the investment industry works. The last chapter ponders the future of Islamic banking after some sharia-compliant finances were unfairly equated with funding terrorism, Worth reading.

Construction Week's Leaders in Construction Summit is set to take place on September 3 in Dubai. IHCC, a turnkey solutions provider that specializes in healthcare, education and mixed-use projects, will participate in the Summit by organizing a panel discussion on designing and managing diverse social infrastructure projects including hospitals, schools and universities. IHCC's CEO Sultan Sobhi Batterjee will share insights at a panel discussion that will mull diverse emerging issues in the real estate sector such as the rise in spending on social infrastructure across the GCC, how contractors can win work in this area, what special capabilities are required and best ways to partner with leading international education and healthcare providers.

Managing Director of Egyptian Takaful Company (Life) GIG Hisham Abdel Shakour revealed that the company plans activating marketing its products through Audi and Abu Dhabi Islamic banks by October. Abdel Shakour explained that GIG obtained the initial approval of Egyptian Financial Supervisory Authority ( EFSA ) to start activating its various products via the two banks' branches along with obtaining the approval of the Central Bank of Egypt (CBE). GIG is still waiting EFSA 's final approval to activate this new marketing activity in Egypt, Abdel Shakour added. The company is planning promoting new five products according to the new marketing system as it contributes to facilitate for the customer to obtain automatically policies with high speed.

BIMB Holdings Bhd’s net profit for the second quarter ended June 30 increased 86.4% to RM129.67mil from RM69.58mil a year ago. The banking group's revenue for the period rose 3.8% to RM734.59mil while earnings per share (EPS) for the period stood at 8.68 sen. For the second-half period, the group said as a result of the acquisition of the 49% interest in Bank Islam Malaysia Bhd, the net profit attributable to the shareholders increased by RM109.4mil or 76.1%. Consequently, the EPS for the period under review also increased by 25.8%. To attract deposits, BIMB said greater focus would be placed on individual and retail deposits with new product features.