IslamicFinance.de

Bankers and officials from Bahrain to Indonesia are standardizing documents and bond structures to limit impediments caused by varying interpretations of Shariah law. Due to the lack of standardization, there is indeed too much reliance on scholars. A well-respected expert can charge between $500 and $1,000 an hour in the Middle East. The scholars' reputations can heavily influence the success of a product, driving demand for a select group of experts and leading to inflated earnings. A central Shariah board at the central bank level could easily take care of it or an international standards setter.

Emirates District Cooling LLC (Emicool) has signed a $245 million 12-year facility with Dubai Islamic Bank (DIB) which will largely refinance its existing debt and also fund the company’s expansion plans. The refinancing agreement was signed by Mr. Abdulaziz Bin Yagub Al Serkal, Chairman of Emicool, and Dr. Adnan Chilwan, CEO of Dubai Islamic Bank, recently in the presence of Mr. Adib Moubadder, CEO of Emicool, and DIB executives. Mr. Moubadder said that there is a huge potential for growth in the district cooling industry, and as one of the major players, Emicool is looking at investing in infrastructure, which will assist to offer quality products to capture a significant share of the market.

Bahrain-based Gulf Finance House plans to list its upcoming $200 million (Dh734 million) sukuk on Nasdaq Dubai. The company said in a statement to Dubai Financial Market that it has signed a Memorandum of Understanding with the Dubai bourse to list the Islamic bond. GFH said it plans to use the proceeds from the sukuk to repay current outstanding sukuk of $84 million and undertake business acquisitions for financial consolidation and project development in Bahrain and Dubai. The $200 million sukuk will take place in the coming months and a date will be announced later after the approval by the regulatory authorities.

London-based Gatehouse Bank is developing new business lines and widening its investor base as the Islamic wholesale lender looks to build a more stable revenue stream. The bank remains focused on real estate in Europe and the United States but wants to expand its investor base beyond Kuwait, its traditional source of funds, while generating more deals outside the British property market. New chief executive Henry Thompson, who joined in April this year, says he wants to reduce the bank's dependence on transaction fees. This comes after fee and commission income dropped more than two-thirds during last year, partly because of lower deal activity in Britain. The bank also plans to launch an online retail deposit product in December and is considering structuring private investment funds.

The National Bank of Pakistan (NBP) has sought regulator’s approval to conduct due diligence of Burj Bank, as the bank wants to continue its footprints in the Islamic banking industry. The NBP had already initiated the process of converting its existing branches into Islamic ones, which will increase to 175 by the end of this year. The acquisition of Burj Bank provides NBP with the opportunity to become a key player in the Islamic banking industry of Pakistan. Burj Bank is the smallest of five full-fledged Islamic banks in Pakistan with a network of 75 branches. The State Bank of Pakistan is stepping up its push to develop Islamic banking, encouraging lenders to expand their operations in the world’s second most populous Muslim nation.

Curtis Law Solicitors were one of the lead sponsors for the Srebrenica Memorial event held at Blackburn Cathedral earlier this month. It aimed to remember the victims of July 11 1995, when 8,000 Bosnian Muslim men and boys were killed. Earlier this year, Noordad Aziz, a councillor and head of finance at Curtis Law Solicitors, visited Bosnia and paid witness to the, still devastating effects of the Srebrenica genocide. This trip fuelled Noordad with a passion to raise awareness and recognition of this modern tragedy in Britain. Following Noordad’s trip, Curtis Law Solicitors worked in partnership with Hyndburn Borough Council on organising an event to demonstrate the official ‘Remembering Srebrenica’ historic memorial programme.

The community and social initiatives launched by Dubai Electricity and Water Authority ( DEWA ) are an integral part of its strategy to serve the public good. DEWA is not only concerned with the provision of power and water, but also making efforts to enhance growth and prosperity in Dubai and the UAE through its social programmes and initiatives. Dubai's first Earth Hour was in 2008, and is one of the many initiatives organised by DEWA to raise awareness about the importance of rationalising consumption of energy. Besides, DEWA organised several environmental activities and awareness programmes to mark World Water Day. Moreover, DEWA organises the Consumer Award to encourage customers to reduce their consumption of electricity and water and follow environmentally-friendly practices.

Islamic economies are set to become more important over the next decade with assets estimated to grow at 15 to 20 per cent a year. There are three powerful forces driving the growth: demographics, devotion and disposable income. Firstly, the Muslim population globally is 1.6 billion, or about 23 per cent of the global population. Secondly, this diverse and dispersed group of people, who span several continents, are drawn together by the devotion to their religion. Thirdly, with the inexorable shift in growth and wealth creation from the West to the East, and the rise in oil prices, the disposable income of this group is increasing. The Islamic economy, on the back of its value system, has the potential to cross religious boundaries and to attract participants with diverse backgrounds who are seeking ethical practices and values in all aspects of commerce-related activities.

Le cabinet d’avocats d’affaires international Clifford Chance conseille la République du Sénégal sur sa première émission de Sukuk de 100 milliards de francs CFA (environ 200 millions de dollars US). Il s’agit de la première émission souveraine de Sukuk importante réalisée en Afrique. Le Sukuk a été structuré sous forme d’Ijara. La République du Sénégal a accordé un usufruit de 99 ans sur certains de ses actifs et a décidé de les louer en retour pour effectuer des paiements de loyers aux investisseurs. L’opération a été garantie par la République du Sénégal. Les arrangeurs de cette opération sont la Société islamique pour le développement du secteur privé et Citi.

Demand for Islamic finance training from non-Muslims rose more than fourfold in the past seven years as students seek to enter an industry whose assets are set to double to $3.4 trillion by 2018. Malaysia’s International Centre for Education in Islamic Finance had 2,000 people enrolled on its courses this year, of whom about 14 percent are from nations with small Muslim populations. That compares with 3 percent in 2007. While students from South Korea, Japan and the U.S. dominate the enlistees, those nations have yet to introduce Shariah-compliant legislation. The industry needs 1 million people with Islamic finance knowledge by 2020 as Shariah-compliant assets are set to reach $6.5 trillion by then.

Trading in the shares of Turkey's third-largest Islamic lender, Asya Katilim Bankasi AS, was temporarily suspended Thursday after its share price whipsawed in the last 24 hours amid conflicting government statements about a takeover of the bank. Bourse Istanbul made the announcement just as the afternoon session commenced. Shares of the lender known as Bank Asya plummeted by as much as 9% on Thursday after Prime Minister Recep Tayyip Erdogan’s chief adviser, Yigit Bulut, decried talks of an acquisition by the state as a farce, reversing a 7% rally from Wednesday. The stock was down 5.3% at 1.24 liras ($0.57) at midday before trading in the shares was halted. Bank Asya was also hit Thursday by the Presidency of Revenue Administration and the Social Security Institution, which canceled agreements.

The European Association for Islamic Economics, Banking and Finance (EUIEBF) and the Islamic Research and Training Institute (IRTI) is organizing Sarajevo's third Islamic Finance Conference. The conference will take place in Sarajevo, Bosnia and Herzegovina from 20-21 November 2014. This conference aims to gather Islamic banking, economics, and finance experts and students to discuss a wide range of topics and fill this gap in research. It will continue the development and acknowledgment of Islamic banking's increasing role in the world. Papers about relevant areas in Islamic economics and finance can be submitted for this conference. Please find detailed information in the attached document.

Hong Kong, Indonesia and Pakistan are banking on pent-up investor demand as they look to raise up to a combined US$3.5bn in the fast-growing Islamic bond market. The three sovereign sukuk issues, including a planned US$1bn debut from Triple A rated Hong Kong, are set to launch before the end of September. Indonesia is Asia’s only regular in the global sukuk market, having issued annually since 2010. Pakistan has sold Islamic debt overseas only once before, in 2005, while Malaysia has typically preferred to target its own domestic market. Hong Kong, in particular, is looking to promote itself as a regional hub for Islamic financing to capitalise on growing trade links between Greater China and the Middle East.

Islamic credit unions are expanding in Thailand and offering investors sharia-compliant services. Worawit Baru, a former senator from Pattani, heads the Southern Thailand Islamic Co-operatives Network (Sticon), an association of faith-based credit unions. During his days in parliament, many businessmen in Bangkok were unaware of the popularity of the Islamic co-operative business model in the Deep South, he said. Today, the network of member-owned, non-profit savings and loan co-operatives has expanded to other parts of Thailand. Among the fastest growing faith-based credit unions is Hat Yai-based As-Siddeek Islamic Co-operative Limited (AIC). Under an agreement with other Sticon members, AIC has no plans to expand farther south.

Noor Bank announced the appointment of Damian White as Treasurer in a statement on Sunday. The role entails managing the bank’s trading activities, investment portfolio and the sale of market based treasury products to customers. As Chairman of the Asset and Liability Committee, he is also in charge of asset and liability management of the balance sheet. Previously, White served as Group Treasurer of Al Rajhi Bank, based in Riyadh. Before moving to the Middle East he was associated with the National Australia Bank, Melbourne, as Head of Group Funding, and also operated as the Head of the Funding Desk at Lehman Brothers Treasury, London.

Countries including Pakistan, Tunisia and South Africa are drawing up plans to issue government bonds that comply with Islamic law as they seek to take advantage of strong investor demand for emerging market sovereign debt. Tunisia is working with the Islamic Development Bank to issue a 1bn dinar ($580m) sukuk this year, while Jordan has instructed a committee to look into the possibility of issuing sukuk next year. Governments in South Africa and the Philippines also say they are considering raising money through the sale of Islamic debt.

Luxembourg will start meeting investors in the next two months to drum up support for a debut sale of shariah compliant bonds. The country, which has an AAA credit rating at Moody’s Investors Service, Standard & Poor’s and Fitch Ratings, is planning to become the second non-Muslim nation to issue a sovereign Islamic bond after the U.K. raised 200 million pounds ($335 million) in June. Ministry of Finance officials will meet investors in Europe, the Middle East, and Asia from the end of September to promote the proposed sale. The ministry is planning to use three government buildings as assets in the deal.

India is preparing legislation to promote Islamic banking as a way to make its financial markets more inclusive and provide new capital-raising opportunities to companies. India’s Ministry of Finance has formed an internal committee to study the prospects for Islamic banking. Sources said the ministry is talking to the Reserve Bank of India and the Securities and Exchange Board of India about introducing rules to streamline sukuk issuance by Indian entities, among other regulatory amendments. Although Islamic banking is not new to India, its services have not prospered. Existing regulation is prohibitive and there is a general lack of awareness about the benefits of Sharia-compliant finance. Sukuk could help close the US$300bn funding gap for the infrastructure sector.

Al Baraka Banking Group (ABG) on Sunday announced its collaboration with the World Bank (WB) to begin a research partnership that would be beneficial to the global Islamic banking industry. The partnership's first initiative, part of a planned series of research projects, will be a study examining the risk-management challenges facing Islamic banks, with a particular focus on Musharaka and Mudaraba under the profit-and-loss-sharing system. The project will not only collect data from a number of countries where Musharaka and Mudaraba are being used in banking transactions, but the project will also examine what enabling legal and regulatory environment would be needed to support the adequate risk management of Musharaka and Mudaraba. The research's preliminary findings are expected to be available in the first quarter of 2015.

Regulators in Jordan have introduced a set of long-awaited rules covering the structuring, issuance and trading of sukuk. Jordan is one of several Muslim-majority countries keen to develop their domestic Islamic finance sector and the government is studying a proposal to issue a sovereign sukuk, mirroring efforts by Egypt and Tunisia. The Kingdom has an established Islamic banking sector but sukuk have been slow to appear. Local company Al-Rajhi Cement has thus far been the only one to issue a sukuk, an 85 million dinar deal in 2011. Lawmakers passed legislation in 2012 allowing the government to issue sukuk but the sector has been held back by, among other things, legal limitations on the transfer of assets required to underpin such transactions.