IslamicFinance.de

His Highness Sheikh Mohammed bin Rashid Al Maktoum, in his capacity as Ruler of Dubai, has issued Law No 13 of 2013 on the establishment of the "Dubai Islamic Economy Development Centre". He also issued Decree No 42 of 2013 to form the Centre's Board of Directors, to be chaired by Mohammed Abdullah Al Gergawi. The decree is effective from the date of issuance. The Centre will have legal personality and financial and administrative independence as well as the legal capacity necessary to direct all actions and behaviours to achieve the goals of the Centre. Promoting Dubai regionally and globally as a main centre for Shariah-compliant goods and services, building a database on Islamic economic activities and encouraging recourse to arbitration in related Islamic economic activities disputes are among the key objectives of the Centre.

Gulf Finance House , the Bahrain-based investment firm which has restructured a number of debt facilities since the financial crisis, has confirmed Hisham Al Rayes as its chief executive officer. Rayes had been acting CEO since March 2012. He said in July that a leaner balance sheet and a new strategy in which it engaged more in its investments would help drive the business forward in future. Its current debt pile is less than $235 million.

The Islamic Bank of Britain (IBB) has completed its first finance deal in Scotland for Al-Meezan, a non-profit, non-political organisation based in Glasgow. The deal for commercial property finance, valued at £400,000, has enabled Al-Meezan to complete renovation and extension work at its premises. It also includes refinancing of the credit for the initial building works, making Al Meezan's finances fully Sharia compliant. IBB 's commercial property finance is tailored to the needs of the customer, and is in line with Scottish law. In this case, the product uses the Islamic finance principles of Musharaka with Ijara. IBB expects continued interest in its offering, particularly in Scotland where there is a growing interest in Islamic and ethical finance.

The Gulf Monetary Council has dismissed media reports that it had set a date for the launch of a single currency for Arab Gulf countries. The Monetary Council is mandated with placing regulations for the establishment of the Gulf Central Bank and completing the establishment of the Monetary Union. Media reports this week said that four of the six Gulf Cooperation Council (GCC) countries would announce the introduction of a common currency by the end of December. The common currency to be announced by Bahrain, Kuwait, Qatar and Saudi Arabia will be pegged to the Dollar, the reports said. The GCC countries have been discussing a currency union similar to the Eurozone for more than 15 years.

AAOIFI Accounting standards reflect concept and essence of Islamic finance transactions and can enhance confidence of users of Islamic finance products and promote growth of demand. This was the conclusion at the AAOIFI-World Bank Annual Conference on Islamic Banking and Finance which was held in Bahrain on 18 & 19 November 2013. The conference also discussed venture capital from an Islamic finance point of view, proposing a model based on a musharaka/partnership arrangement. Moreover, the main types of risks faced by Islamic financial institutions such as non-compliance risks, operational risks, financial risks, and so on were outlined. The conference wrapped up by presenting some guidelines about how AAOIFI standards can be promoted in countries that follow international accounting standards or IFRS.

The global demand for Islamic pension funds is currently between $160 billion and $190 billion, according to estimates by Ernst & Young's (E&Y) Global Islamic Banking Center. At present, most of these funds are parked under conventional sovereign pension funds due to lack of investment options. Several fast-growth emerging markets including Malaysia, Saudi Arabia and UAE are seeing strong demand for Shariah-compliant retirement plans. A key decision is whether to allow members of the fund to transfer their existing account balance to the Sharia-compliant fund, or if only the future contributions should be segregated as conventional or Islamic. Additionally, timing for the desired transfer is important. The fund would model the outcomes based on several factors.

According to Kuwait Finance House (KFH) CEO Mohammed Al-Omar, the continuous increase in profit over five consecutive quarters underlines the success of the restructuring process and the management's decision to focus on main operations to achieve sustainable profit, offer better returns to shareholders and depositors, and easing burden off the institution. He explained that that a rearrangement of the real estate portfolio is occuring, to benefit from current developments in the real estate market, in terms of rates and shifting to certain kinds of real estate and land. Furthermore, Al-Omar noted that the strategy that KFH adopted regarding its overseas banks, has played a role in cementing their roles and making them more profitable.

Thomson Reuters has released the findings of its second consecutive Sukuk Perceptions and Forecast Study. Overall, the study found that the potential demand and supply pipeline of sukuk is expected to grow. Despite this increase, demand is still expected to outstrip supply substantially until 2014, when it is predicted supply will begin to outpace supply. On the demand side, investors expect 50 percent of their portfolios to be allocated to Islamic finance investments, out of which 25% to 35%, would be allocated to sukuk. MENA investors overwhelmingly prefer USD sukuk. Oman is viewed as the most attractive emerging Islamic finance market for sukuk investment. The study will be launched at the Global Islamic Economy Summit on 25th & 26th November 2013 in Dubai.

Al Madina Investment (Al Madina) has organized an event to celebrate the issuance of the first sukuk in Oman. Al Madina acted as the Principal Advisor, Joint Lead Arranger and Joint Lead Manager for the OMR50 million Sukuk Al Ijarah issued by Modern Sukuk on behalf of Tilal Development Company (TDC). The proceeds from the sukuk will be utilized for the expansion of TDC's flagship project - the Tilal Complex. In the event, Al Madina honors the stakeholders and also the participants in the sukuk by presenting them with an award for their contribution to successful issuance of the sukuk.

Takaful Oman Insurance, one of Oman's first takaful insurance providers and still under formation, has announced its initial public offering (IPO). The promoters are offering 40mn shares, each priced at 102bz - with a par value of 100bz and 2bz of issue expense. The IPO, which opened for subscription on October 30, will close on November 28. Takaful Oman is promoted by ONIC Holding, National Investment Funds Co ( Nifco ), Oman Investment Corporation (OIC); National Bank of Oman, Blue Door Investment Services LLC, bank muscat, and T'azur Takaful insurance company, one of the top five takaful companies in Kuwait.

Malaysia's Royal Award for Islamic Finance commences the third global search to honour an exceptional individual in the field of Islamic finance, with the opening of nominations. An independent seven member international jury will select the deserving individual. The selection criteria encompass both qualitative and quantitative aspects, including financial innovation and pioneering work, exceptional leadership, adoption and acknowledgement within the industry, and inspiration and influence towards future progress and development of Islamic finance. The closing date for nomination is 31 January 2014, and interested persons and parties can submit their nomination online via the website award.mifc.com or via email RAIFSecretariat@seccom.com.my.

The Dubai government plans to establish a centre that will develop standards for corporate governance based on Islamic values, guiding companies in both financial and non-financial activities. The centre is to be opened in the second quarter of next year. The standards will not be compulsory for firms but the centre will issue sharia-compliance certificates to companies and banks meeting them. The standards will cover issues such as corporate transparency and disclosure. However, certificates will not be issued for individual products.

Members of Saudi Arabia's wealthy Baeshen family, who control one of the Middle East's leading tea purveyors, AMS Baeshen & Co., are suing the reorganized Bahraini private equity and investment firm Arcapita Bank for the return of millions of dollars they'd earmarked for the bank's aborted stock sale. Lawyers for the Baeshens, the family behind the Rabea Tea brand, are seeking the return of some $3.5 million deposited at the bank in connection with the Bahraini bank's abandoned rights offering.

Bahrain-based Al Baraka Banking Group ( ABG ) has achieved a net income of US$ 197 million in the first nine months of 2013, an increase of 8% on the net income achieved in the first nine months of 2012. Similarly, statement of financial positions witnessed moderate increases. Total assets increased by 4%, investments and financing portfolio by 5% and customer accounts by 2% as at the end of September 2013 as compared with the end of December 2012. The net income amounted to US$ 197 in first nine months of 2013 compared to US$ 183 million in first nine months of 2012, which reflects an increase of 8%. With regard to the Group's plans to expand its branch network, the President & Chief Executive said that the subsidiary units of the Group in Turkey, Egypt, and Sudan continued opening new branches.

In an effort to prevent any repeat of Dubai's corporate debt crisis, the UAE central bank plans to restrict the amount of exposure banks can have to the debt of government-related entities. The rules will be issued by the end of this year and banks are expected to be given about five years to finish complying with them. A period of consultations between the central bank and commercial banks ensued. Last week, the UAE central bank issued restrictions on mortgage loans in order to limit speculation in the real estate market; the caps were not as stringent as initially planned because of lobbying by the banking industry.

A recent report by Standard and Poor indicates that while Islamic banks in the GGG are likely to grow faster than their conventional counterparts, profititability rates for the two banking models are converging as Islamic banks take a hit from comparatively lower interest rates and non-core banking revenues. The economies of the countries that make up the GCC are showing robust recovery after the 2008 economic crisis, with Qatar looking particularly strong. The region has one of the world's largest Islamic banking markets and the sector has healthy performance metrics. S&P predicts that Islamic banking in the region will continue to increase its market share, and they expect the operating environment over the next two years to remain supportive for Islamic banks' business and credit quality.

Kuwait Turkish Participation Bank Inc has been granted a licence by the Qatar Financial Centre ( QFC ) Authority, with effect from September 15 2013, to establish a branch in the QFC . The bank expects to open its QFC branch in about two months. It is licenced to undertake deposit taking; providing and arranging Islamic credit facilities dealing in Islamic investments and managing Islamic investments. The bank is a Turkish Islamic bank with 62 percent owned by Kuwait Finance House, Kuwait, 9 percent by PIFSS, Kuwait, 9 percent by Islamic Development Bank, Saudi Arabia, and 18 percent by Turkish Awqaf. It is the first and only Turkish bank to have a presence in Qatar.

Fitch Ratings has affirmed UAE-based Abu Dhabi Islamic Bank 's (ADIB) Long-term Issuer Default Rating (IDR) at 'A+' with a Stable Outlook, and Viability Rating (VR) at 'bb'. The bank's IDRs, Support Rating and Support Rating Floor reflect
Fitch's opinion that there would be an extremely high probability that support would be provided by the UAE authorities if needed. In addition, Fitch believes that support would be forthcoming from the Abu Dhabi government (AA/Stable/F1+). Although Fitch expects the overall asset quality issues and exposure to a seasoning financing book to continue to present challenges in the short term, these are manageable. Fitch believes that the VR remains sensitive to any deterioration in asset quality, capital or profitability.

EIIB-Rasmala, a venture between London-based European Islamic Investment Bank and Dubai's Rasmala Group, plans to widen its range of Islamic investment products with the hope of doubling assets under management over the next two years. The firm, which manages over $1 billion in assets, sees growing mid-market opportunities for its Islamic asset management and investment banking business lines, chief executive Zulfi Hydari said. By mid-market, the firm means medium-sized customers which may no longer be served by big investment banks. In investment banking, the firm is focused on arranging Islamic bonds, with deal sizes between $75 million to $150 million. Earlier this month, the firm already arranged the first tranche of a $100 million sukuk programme from FWU Group.

The Tunisian Islamic insurance company "El Amana Takaful," set up as part of a Tunisian-Saudi partnership project, came into service on Wednesday. This Islamic insurance company operates with paid-up capital of TND 10 million ($6.3 million). Saudi businessman Mr. Hassan Salem Al-Amari was appointed as the chairman, and Hussein Al-Daghri was named the deputy chairman. The company was licensed in April. Most of its shareholders are conventional insurers, including Comar, Astree, and Carte – each with 18% share – and Tunis Re, with a 6% stake.