IslamicFinance.de

An announcement by Sustainable Options Ltd sias that a new hedge fund - Sustainable Resources Fund - will be launched. As an open ended hedge fund, it will appeal to both green and Islamic investors. Its goal is to raise $100m for investment in a series of sectors like agro-forestry, land and sustainable agriculture. The fund has appointed an investment manager - Alpha Wealth Management - and a fund administrator - Apex Fund Services.

A significant growth in the global takaful industry has bben observed over the last few years. According to the Ernst & Young World Takaful Report 2012, global takaful contributions show an increase of 19% to $8.3 billion in 2010. $5.68bn of these contributions belong to GCC. Nevertheless, it is a key challenge for takaful players in the Middle East to maintain the growth momentum while boosting profitability.

Profitability and asset growth in the GCC banking market have grown significantly since last year. This development is due to a favourable regional macroeconomic environment as well as reduced cost of risk. Since the facts correspond with A.T. Kearney's banking outlook from 2011, optimistic attitudes though with some cautiosness return. Markable differences in the growth rate and profitability of the UAE countries over the last year are discussed.

According to a GCC survey, insurance profitability has deteriorated significantly in the past four years across top 30 conventional insurers. While 28% in 2007, it sropped down to 9% in 2011. A solution to prevent further decline is to revamp operating models with profitability pillars. There is a huge difference between e.g. motor premiums and medical insurance, which causes controversial reactions by insurers. While motor premiums in the UAe show a decrease of 23% over the last three years, healthcare provider costs have grown up to 50% in the same period.

Amana Takaful showed a significant growth of 32% for the first half of 2012. According to the figures of the period the total Gross Written Premium(GWP) is as high as Rs 770.8 million. Compared to this, the same period last year had a GWP of Rs.584.7 million. The company's development is in accordance with the 11% growth in overall industry.

Mushtak Parker gave an interview on a series of topics, among wich the International Islamic Liquidity Management Corporation (IILM), education in Islamic finance, moving the industry to US$2 trillion (RM6.22 trillion), scholars on multiple boards, and the late Dr Zaki Badawi. Parker expressed his opinion that even though the establishment and goals of IILM are highly commendable, it lacks transparency. This leads to problems in its process of its conception and imediate operation. He fears that IILM will not adress liquidity management leaving thus the gap open.

The ageing population of UAE is expected to highly demand for Islamic savings products. Thereby, Shariah compliance of the products is the major factor in making a choice. National Bonds Corp offers a number of different savings products including a mudaraba fund now worth 4.6bn dirhams ($1.25bn) in assets under management. The company's future plans include the development of a range of savings which aim to satisfy the growing demand.

The conventional private equity (PE) industry's taking advantage of excessive cheap debt before the global financial crisis in 2008 has a negative effect when the markets collapsed. In contrast, Islamic PE was able to avoid this situation by relying on restrictions on taking conventional forms of leverage. According to Qatar Finance Centre Authority's director, Yousuf Al-Jaida, there is a strong correlation between Islamic PE and the real economy. The huge difference between the both tyes of PE is that Islamic PE is based on Shariah principles which excludes businesses such as breweries, casinos, riba-based banks and pig farms.

The private equity firm Foursan Group has invested in in Jordan Dubai Islamic Bank (JDIB) and thus became the bank's second largest shareholder. The investment was completed through Foursan Capital Partners I. The goal of this transaction is a benefit from the rapidly growing Islamic banking sector as well as from JDIB's overall positive future growth prospects.

The Association of Islamic Scholars (ASAS) in Kuala Lumpur plans to start a shariah board accreditation process. The move fill follow a points-based system, where the points are earned by Islamic scholars who participate in training cources offered by regulatory bodies. Shariah scholars will be required to sign a voluntary code of ethics and take a corresponding test. The scholars, however believe that this move is bound to fail. It is possible that Islamic finance advisors will not accept the notion of being accredited since the majority of them offer theit services without it.

Bank of Khyber (BoK), the new Raast Islamic Banking Branch at Mingora was formally inaugurated by Engr Humayun Khan on Friday. At the ceremony, Engr Humayun Khan expressed his appreciation of the vital role of BoK in province's socio-economic uplifts activities. Furthermore, he said that the government extended its full support to BoK. He also pointed out the bank's importance for the implementation of the self-employments schemes of the provincial government in order to reduce the unemployment among youths.

A report by Standard and Poor says that Islamic financing could support Indonesia to fulfill its infrastructure plans. Islamic financing would be able to bridge gaps in funding major infrastructure development projects. The same strategy was used by Malaysia. The situation in Indonesia is explained by the country's large needs to develop the infrastructure, the willingness of the government to attract private capital to fund these investments, and the increasing demand for investable assets of a growing domestic Islamic finance market.

Zurich Financial Group Ltd shows strong interest in involving in the takaful business in Malaysia. Strategically, a takaful arm contributes to the bench strength and access to the increasingly appealing market. Unfortunately, it is very unlikely for Bank Negara Malaysia to issue new takaful licence since they issued new licences to four new players in 2009. The hopes lie in 2014 when the adoption of the Risk Based Capital framework by the takaful industry is expected.

According to plan the Turkish investment fund Kuveyt Turk will open the first Islamic bank in Germany this October. They sustain the hopes to overcome the euro crisis and to profit from successful Islamic banking. In contrast with highly speculative financial management which caused the ongoing euro crisis, the Islamic bank shall offer only transactions backed by tangible assets.

According to KPMG Oman, conventional banks in Oman that do not offer any Islamic banking services will face the threat to lose numerous customers which will prefer a bank that offers Shari'ah-compliant financial services. Khalid Yousaf, Director of Islamic Finance Advisory Services, KPMG Oman, claims that opening an Islamic window operation is a safe strategy. As a reason he points out that it requires less capital while, at the same time, sharing a common cost base with additional business.

Sukuk continues to attract interest among investors. Until now, $17.4bn have been raised in the form of 45 issues. This may look little compared with conventional credit markets. However, in Islamic banking, it is the highest issuance in the first half of the year since 2008. The sukuk wave is expected to become even bigger. Causes therefore are that the majority of sukuk investors are Islamic investors as well as that liquidity in the Middle East is driven by oil prices to a high extent. The situation is different in Malaysia, since the country is not an oil producer. The solution there is shaping the supply side to boost the market by regulation.

A team from Bankable Frontier Associates started a project to study the effect of interoperability in retail payments on the outcome of financial inclusion in Pakistan. The target they set was 100 million Pakistanis to be financially included electronically by 2020. Now the final report is ready and available for the public. Specific ideas for the Pakistani market are provided in the report. These are intended to be implemented in workshops with Pakistan industry. Moreover, the report stresses on the importance of interoperability and the reasons for that as wel as on how people should think about it from a policy and market development perspective and how it should be measured.

An announcement of Gatehouse Bank plc states that the bank has a strong set of interim results for the first six months of 2012. Profit projections have been exceeded by almost 10% with a total of more than $3.2 million (GBP 2.1 million). This shows that the bank’s business and operating model is maturing out of its start-up phase. The bank is also close to meeting its 2012 financial plan, since the income for the same period is £6,121k in comparison with £1,719k for the comparative period - a 250% increase. Thus, substantial growth and wealth preservation on behalf of its investors is delivered.

The Convergences 2015 world Forum for the Millennium Development Goals will be on in Paris from 19-21 September 2012. It is a main event for all professionals interested in discussing innovative answers to reduce poverty in Europe and around the world.

Financial Times Deutschland reports that Kuveyt Tuerk will open the first sharia compliant banking branch in Germany. The bank's headquarters will be in Frankfurt. Other branches are to be opened in other cities with a high density of Muslim inhabitants, according to FTD.