IslamicFinance.de

Kuveyt Turk Participation Bank (KTPB) has set the tone by venturing abroad into Germany, Dubai, Bahrain and Kazakhstan and by pioneering new products based on physical gold and exporting them to markets in Malaysia and elsewhere through the global network of KFH. These include gold-backed exchange traded funds (ETFs), gold-backed banking accounts and sukuk. Ufuk Uyan, CEO of Kuveyt Turk Participation Bank has been at the forefront of the expansion of KTPB, taking it to the top 10 tier of Turkish banks. Here Ufuk Uyan discusses with Arab News the state of the participation banking sector in Turkey, the performance of KTPB in 2010 and the prospects and challenges for the industry in 2011 and beyond.

Kazakhstan will revisit a plan this year to issue debut sovereign Islamic bonds worth U.S.$500 million.
It will create a benchmark for corporate lenders because its aim is to build an Islamic finance sector among its majority Muslim population.
Central Asia's largest economy also plans to attract up to US$10 billion in Islamic finance in the next five to seven years, officials said yesterday, as a alternative means of financing an ambitious industrial growth programme.

Kazakhstan will revive plans this year for a $500 million debut sukuk issue that could create a benchmark for corporate lenders. The aim is to develop an Islamic finance sector in Central Asia’s top economy.

Kazakhstan plans to attract up to $10 billion in Islamic finance over the next five to seven years, Arken Arystanov, chairman of the regulatory agency at the Regional Financial Centre of Almaty (RFCA) stated.

Malaysian trustee company Amanah Raya Berhad is joining forces with Fattah Finance and the state-owned Development Bank of Kazakhstan to conduct a feasibility study to establish the second Islamic bank in the CIS country. Their purpose is to submit an application for an Islamic-banking license later this year under new legislation introduced by Kazakhstan in 2009 to facilitate the establishment of Islamic banks and the introduction of Islamic financial products in the country.

To assemble international Islamic Microfinance organizations under one platform, Islamic Microfinance Network (IMFN) has been established in Lahore – Pakistan. The initial member countries of Islamic Microfinance Network are Iraq, Jordan, Yemen, Ghana, Mauritius and Kazakhstan.
The objective of this network is to provide best methodologies of Islamic microfinance, Shariah guidelines, and lasting relations and manpower to the industry.

Kazakhstan is aiming to become a Central Asian hub for Islamic finance, with plans to launch its first corporate sukuk this year and a new Sharia-compliant bank.
Kazakhstan is seeking foreign investment to help diversify its economy into areas including petrochemicals, renewable energy, tourism and agriculture. The UAE and Kazakhstan also have "good potential" for cooperation on food security.

Kazakhstan’s government expects to pass legislation within the next two months. This legislation will enable companies to sell Islamic bonds.
Kazakhstan has reportedly identified two prospective issuers for its flagship corporate sukuk, one a South East Asian company registered in Kazakhstan, and a local company, Yerlan Baidaulet.

Malaysian trustee firm Amanah Raya Bhd expects to obtain licences to set up Kazakhstan’s second Islamic bank in the second quarter of 2011 and begin operating the lender within a year.
Amanah Raya would have a 55 per cent stake in the joint venture company to be set up, state-run Development Bank of Kazakhstan will own 40 per cent and brokerage Fattah Finance the balance.

The following borrowers are expected to sell Islamic bonds: MALAYSIA, YEMEN, DUBAI, GULF INVESTMENT CORP., FRANCE, SAUDI INTERNATIONAL PETROCHEMICAL CO., GENERAL ELECTRIC CO., PALESTINE MONETARY AUTHORITY, NAKHEEL PJSC, SABAH CREDIT CORP., CREDIT AGRICOLE SA, NOOR ISLAMIC BANK, NATIONAL COMMERCIAL BANK, KPJ HEALTHCARE BHD., EMIRATES TELECOMMUNICATIONS CORP., SENEGAL, ALBARAKA BANKING GROUP., ISLAMIC DEVELOPMENT BANK, THAILAND, KNM GROUP BHD., CAGAMAS BHD., SAUDI ARABIAN OIL CO., GAMUDA BHD., EGYPT, PT BANK MUAMALAT INDONESIA, SENAI-DESARU EXPRESSWAY BHD., MALAYSIA DEBT VENTURES BHD, INDONESIA, TURKEY, KAZAKHSTAN, PHILIPPINES, SAUDI ELECTRICITY CO., EMIRATES INTEGRATED TELECOMMUNICATIONS CO., LAFARGE MALAYAN CEMENT BHD..

After a lengthy delay, the government is on track to issue Kazakhstan’s first sovereign sukuk, or Islamic bond, before the end of this year – a key step in the country’s desire to become a regional financial hub, says Arken Arystanov, head of the Regional Financial Centre of Almaty City (RFCA).
Amendments to Kazakhstan’s law on Islamic finance and banking, currently being considered by parliament, are due to be adopted within the next two months, Arystanov says, paving the way for the government to issue its debut sukuk - most likely in the $500m range - by the end of 2010.
It’s certainly true that for some Kazakh companies there has been no difficulty in raising money by traditional means recently. State nuclear company Kazatomprom’s debut Eurobond in May 2010 was eight times oversubscribed; the issue by national rail operator Kazakhstan Temir Zholy in September was seven times oversubscribed.

Seeking to diversify its financial industry after a banking crisis, oil-rich Kazakhstan is drawing on Arab and Malaysian investment in an effort to build an Islamic finance industry among its 13mn Muslims. Its success may depend on the fate of pioneer investors and the commitment of its secular government to clear the way for a long-awaited sovereign issue of sukuk, or Islamic bonds, which could prompt other issuers to follow. Al Hilal, owned by the government of Abu Dhabi, was the first bank to respond when Kazakhstan passed new laws last year to allow an Islamic finance industry. The bank opened its Kazakh offices in March 2010. Though modern Islamic finance began three decades ago, its major principles, such as a prohibition on paying interest, would have been familiar to Muslim traders on the medieval Silk Road through Kazakhstan and Central Asia. Investors, though, are cautious. The financial crisis humbled the once-proud Kazakh banking sector; international creditors were forced to write off billions of dollars of debt in a restructuring process that followed local bank defaults.

Kuveyt Turk Katilim Bankasi AS is planning a second sale of Shariah-compliant debt for 2012. Kuveyt Turk, the Istanbul-based bank owned by Kuwait Finance House KSC, may sell more than $100 million of five-year sukuk. Islamic bond offerings may accelerate in the next 18 months, led by countries new to the market, Mohamed Damak, a Paris-based credit analyst at Standard & Poor’s. Policies to promote assets that follow Islamic law are spreading to Europe from Asia.

The Governments of Kazakhstan and the United Arab Emirates signed the agreement on opening of Al Hilal Islamic Bank in Kazakhstan; Aigul Tulekbayeva on Kazinform reports. The Bank’s nominal capital will make up over AED 100 mln and it will be opened in Astana and Almaty.

Fattah Finance was launched in March, immediately after Kazakhstan's law on Islamic finance came into force.
A subsidiary of Almaty-based financial services provider Almaty Financial Centre, Fattah currently offers only brokerage services, but plans to expand its range of activities later this year as it grows its team. It offers its clients shares that are listed both in Kazakhstan and in other markets. "It doesn't matter where the shares are listed, only whether they are Sharia compliant or not," says Ussenzhan Turdiev, head of Fattah's information and analysis department.

The full interview by Clare Nuttal can be read via the link below.

Bahrain-based Gulf Finance House is seeking to raise USD 600 mn for energy projects in Libya and Kazakhstan this year.

Stanley Carvalho reported on 31 March on Reuters that Abu Dhabi's government-owned Al Hilal Bank will set up an Islamic bank in Kazakhstan. Al Hilal will headquarter the new bank in the central Asian state's capital Almaty, opening in the second half of 2009 with an initial capital of AED 100 mn(USD 27 mn).

Chairman of Hilal Bank is Ahmed Ateeq al-Mazrouei.

Clare Nuttal reported on 13 February on Business News Europe that Kazakhstan launches a new commodity exchange and confirmed in the same article that the Islamic finance law came into effect in January.

Caspionet reported on 28 January, that Darakhim Sukuk Basket have been presented in Kazakhstan. It is expected that insurance companies, unit investment funds and pension funds will become the chief buyers of the new investment offer. Basically, they represent the companies of the Middle Eastern states, so they are issues of the central bank of Bahrain, the government of the Arab emirates, Kuwait and Saudi Arabia. It is expected that the profitability will amount to 10 % at a minimum with a circulation period of 3 years.

Gulf News reported on 11 April that Gulf Finance House aims to develop the USD 10 bn Caspian Energy Hub in collaboration with the Government of Kazakhstan and PFC Energy International and signed a Memorandum of Understanding. The project, shall be a services hub that caters to commercial, technical and human resource needs of the oil and gas industry in the Caspian region. The hub also aims to become a global technical training centre for the oil & gas industry.

Esam Janahi is chairman of Gulf Finance House, Vahan Zanoyan is CEO of PFC Energy International and both presented the concept to Kazakhstan President Nursultan Nazar. Ulf Wokurka is deputy chairman of the Management Board of Kazakhstan Holding for Management of State Assets. Gani Uzbekov is deputy chairman of the Board of Sustainable Development Fund called "Kazyna".

Source: http://archive.gulfnews.com/business/Oil_and_Gas/10204695.html