IslamicFinance.de

According to CIMB Group Holdings Bhd and RHB Capital Bhd, the rally in ringgit-denominated Islamic bonds that pushed yields to an eight-month low will stop after the central bank ruled out a cut in interest rates.
After the interview with Bank Negara Malaysia Governor Zeti Akhtar Aziz, yields may rise.The governor noted that the benchmark policy rate of 3 percent is supportive of economic growth ahead of a March 9 review.
Overseas funds reduced holdings of local-currency government Islamic bonds by 11 percent in January to RM490 million (US$163 million), the least in a year.

It seems that Dubai’s Noor Islamic Bank is the only institution in the United Arab Emirates that has been targeted by the US for dealings with Iran. Moreover, it appears that the bank had been a primary conduit for returning foreign-currency oil receipts to Iran, until it agreed in December to end dealings with Iranian entities that have been sanctioned by the US and the European Union, including Iran’s banks Saderat and Melli.
Meanwhile, National Bank of Abu Dhabi, the emirate’s largest bank by assets, noted it is reducing banking activities with Iran because of mounting international sanctions against the country.

Gulf Finance House (GFH) presented its financial results for the year ending 31 December 2011, during which the bank returned to profitability despite a challenging year underscored by shortfalls in market liquidity and rising political tension throughout the region.
The reason for this return was the result of strong shareholder support, investor loyalty and a dedicated management team committed to seeing through the significant restructuring and recapitalization plan that was set in motion in 2010, and which has seen the Bank return to a net profit of US$381 thousand in 2011 as compared to a net loss of US$349 million in 2010.

Dubai Islamic bank with ties to the emirate’s ruling family stopped doing business with Iranian banks in December, shortly before the United States approved new sanctions targeting the country’s financial system.
The decision by Noor Islamic Bank cuts off another of Iran’s links to the international banking system. Noor appears to have acted indirectly in response to Washington’s efforts to compress the screws on Tehran.
The Iranian economy is under increasing pressure from a growing series of U.S. and European sanctions pointed at stopping its disputed nuclear program. Washington and its allies fear Iran is trying to develop nuclear weapons.

Tunisia's Islamist government is planning to launch the country's first Islamic bonds (sukuk) this year in order to finance its budget deficit following last year's uprising.
Adnan Ahmed Yousif, chief executive of Bahrain-based Al Baraka Banking Group, an Islamic banking conglomerate with operations across North Africa, added that the government is now in talks with banks.

A body promoting development of debt sales to block climate change, with sponsors including National Australia Bank Ltd. and HSBC Holdings Plc, plans to accelerate green Islamic bond markets as the Middle East diversifies from oil.
The Climate Bonds Initiative will build up a panel to help create financial products complying with Islamic shariah law. It will work together with the Clean Energy Business Council.
Oil-rich Gulf nations are searching to diversify away from fossil fuel production and toward green-energy projects as they look to longer-term sustainable development of their economies. Higher international crude prices also encourage the countries to sell more of their oil abroad.

Dubai developer Nakheel wants to begin the selling of properties in its Palm Jumeirah project next month. These will be the first properties to be sold on the development since the property crash of 2008.
The Palm Residence project will test request for property in a market where prices have dropped more than 65% since their peak in the middle of 2008.
Most of the Palm project will be financed by off plan sales, meaning sales agreed before construction begins, a method that was common before the property slump and that has been criticised for being responsible for flipping and the price boom that led to the property crash.

Interim Prime Minister Hamadi Jebali noted that the Tunisian Government will try to establish a legal framework to manage the Islamic economy in Tunisia. He added that the country wants to become a regional centre of Islamic finance.
Moreover, he attested that Islamic banks can provide part of these funds.
IDB President Ahmed Mohamed Ali stated the Bank wishes to see the Tunisian private sector play a more significant role in implementation of the bank's projects in Tunisia and Africa.

Ithmaar Bank presented a net loss of $61.9 million for the year 2011, compared to a net loss of $140 million for 2010. The 2011 results include a consolidated Fourth Quarter loss of $68.6 million, as compared to a loss of $153.4 million for the same period last year.
The announcement was given by Ithmaar Bank Chairman His Royal Highness Prince Amr Mohamed Al Faisal.

Adnan Ahmed Yusuf, Chief Executive Officer of Al Baraka Banking Group and Chairman of the Union of Arab Banks, noted that the Islamic banking in the Sultanate will expand and will achieve more than 20% of the domestic banking during the next five years.
He also disclosed the interest of ABG to enter the Islamic banking sector in the Sultanate but due to factors related to the policy of the group towards the form of ownership, Al Baraka Group is currently thinkking about the possibility of managing a bank in the Sultanate or engaging in Islamic finance if the new banking laws permit so.

Capinnova Investment Bank went back into the black last year. The bank had a net profit of $86,000 for the fourth quarter compared with a net loss of $2 million for the same period in 2010.
Chairman Abdul Kareem Bucheery noted that they will continue to capitalise on these opportunities in 2012 and the following years by introducing good Islamic banking products that meet our investors requirements and expectations. He added that Islamic banking industry in Bahrain is one of the important sectors with an array of opportunities that are yet to be exploited.

Singapore’s path to Shari’ah compliant home financing is being chocked by bureaucracy. The Islamic Globe recently noted on the absence of Islamic home financing products despite the Monetary Authority of Singapore having legislated for a range of Shari’ah compliant Islamic banking structures.
Furthermore, The Islamic Globe has learnt from a well-placed source that Maybank Islamic in Singapore has for the past two years been in discussion with local government agencies to pave the way for Shari’ah compliant home financing.
However, the source added that the greatest hurdle lies with the Central Provident Fund, which offers three elements of financial security – retirement, home ownership and healthcare.

With the issue of the world’s largest single tranche Sukuk, the industry’s attention is again on that fair-weather barometer the omnipotent Sukuk.
Beside the Saudi issue, it’s been a busy week in the Islamic capital markets, with significant issues in Malaysia and the MENA region and announcements from Nigeria, South Africa, The Gambia and Iran. It seems that the appetite for Sukuk is not diminishing. But the real quesstion is, if this is a good thing. After all, the global depression playing out in extremis in the eurozone and Middle America can be followed back to the wild abandon that individuals and governments ran up their credit card bills and the irresponsible and myopic lending practices of the banks just interested in short-term profits and next year’s bonuses.

It seems that Bank Negara Indonesia (BNI) is currently searching for a partner to further tap growth opportunities in Shariah banking.
BNI also follows some potential acquisition targets to help the bank make inroads into the micro-finance market. Furthermore, the bank intends to strengthen its headcount in Indonesia, in part to catch opportunities arising from higher foreign direct investments into the country.

When it comes to public relations and marketing, the industry has a very big hole that is expanding day by day.
Although expanding their mandate to include marketing and public relations for a geographically- dispersed and fragmented industry at various stages of development would be unreasonable, the continued negative headlines will not go away even if they are ignored.
After determining a need for an industry body to promote and educate Islamic finance, the funding question should be asked. Fortunately, the experience of AAOFI, IFSB, IIFM, etc, suggests the stakeholders could include the Islamic Development Bank (IDB), Islamic financial institutions, forward-looking governments like Malaysia, the United Arab Emirates, and possibly the existing industry bodies (to include their technical message).

Despite the fact that the deadline for RRSP contributions is approaching, there's another important investment concern for Muslims — ensuring the products they rely on for their retirement income comply with Islamic principles.
There has been an importance over the last decade in investment products that adhere to the strict dictates of Shariah law. So-called Shariah-compliant investments have become very popular, due in part to investor interest in working with the Middle East as oil prices continue to rise.
The key elements of Islamic investing are the avoidance of interest.

ABC Islamic Bank presented a net profit of $8.1 million for 2011, 293% higher than last year. Shareholders' equity at 31 December 2011 was $227.7 million, compared to $219.8 million at 2010 year-end. The bank's capital base is still very strong with a capital adequacy ratio of 27.5, predominantly Tier 1, which totalled 26.5%.
According to Mr. Naveed Khan, Managing Director, ABC Islamic Bank anticipates a growth of its financing activity selectively, as a result of both its recent drive to win new clients, and a gradual recovery in the borrowing appetite of customers.

A new report shows that sovereign wealth funds (SWFs) and cash-positive pension funds from Asia and the Middle East are an arising force behind the high level of global capital currently flowing into the Central London commercial real estate market.
Central London has always had a pivotal role in international commercial property investment in an European and global context, completely overshadowing other global cities in terms of cross-regional investment into European real estate, because of its traditional strengths of transparency, long income flows and relative liquidity.

It seems that Barwa Bank made plans to apply for a credit rating next year before a possible debt offering. Chief Executive Officer Steve Troop noted that is a good set of results will come up in 2012, they will look for a rating in 2013.
Qatar’s biggest lender Qatar National Bank SAQ (QNBK) raised $1 billion in a sukuk offering earlier this month. Doha Bank QSC, Al Khaliji and International Bank of Qatar have announced plans to sell debt after no sales by lenders in the country last year.

Unrest in Syria is developing chaos at the country's banks, which posted bumper profits last year as a plunge in Syria's currency boosted foreign exchange gains, but will have big problems this year in the face of rapidly declining deposits and rising bad loans.
Inspite of this, the central bank has encouraged banks to keep up high foreign currency holdings as the country's foreign exchange reserves have depreciated since the political turmoil began.
At this point analysts question how many banks will survive as the uprising and Western sanctions have disabled Syria's economy and triggered capital flight, causing total bank deposits to drop by almost a third since the unrest began.