IslamicFinance.de

Abu Dhabi Islamic Bank (ADIB) closed a Dhs275m ($75m) syndicated Islamic financing facility for JBF RAK LLC (JBF RAK), a subsidiary of JBF Industries. This indicates the debut Islamic finance facility for JBF RAK. It is a leader in the Middle East region with a market share of over 20% in chips and film products.
The financing will be used to develop JBF RAK production in Ras Al Khaimah including the purchase of new machinery and equipment and to optimize its debt profile by presenting Islamic term funding.

In 2005, Afrik Grocery and Halal Meat on Cedar Avenue needed to develop. Owner Abdi Adem, who conducts his business under Sharia law, needed a loan to fund the expansion.
Since December 2006, the city of Minneapolis, together with the African Development Center, has given out 54 loans in a way that is compliant with Islamic law by using a fixed rate in place of a variable interest rate.
Instead of charging interest, the city and the ADC estimate how long it will take the business to pay off the loan and totals what the interest would be. That amount is counted as a lump sum to the total cost of the loan.

Indonesia’s Islamic finance industry is attracting investment from Middle Eastern and European banks as regulator is searching to double Shariah-compliant assets to 10% of the total this decade.
According to Mudassir Amray, the head of wholesale banking in Kuala Lumpur, Al Rajhi Bank is pursueing investment banking business in Indonesia and may open branches when the right time comes.
Moreoever, Bank Indonesia is proposing tax breaks to raise the industry, which has grown an average 38% annually over the past five years.

Oliver Agha, founding Partner of Agha & Co, a shari'ah-compliant law firm based in the United Arab Emirates, is a board member of the Accounting and Auditing Organisation for Islamic Financial Institutions, and secretary general of the World Islamic Finance Institute.
Islamic finance is torn between the market success of emulating conventional structures and developing genuinely Islamic structures that show its spiritual ethos.
The industry is continuing to grow inspite of its inherent problems, and some market analysts forsee it will be valued at anywhere from $3 to $5 trillion by 2016.
While the spiritual precepts behind Islamic finance support risk sharing and partnerships, many products in the market reflect risk profiles of conventional structures. As disputes in such products/structures expand, the judgments could threaten the future of the industry.
But, as a conclusion, Islamic finance is not a failure. It is never correct to blame a discipline for the failures and shortcomings of its adherents. However, in order to continue to grow in a correct way, it must come back to its spiritual underpinnings best reflected by the motto: "Principle before Profit".

Bank Transfer Day and the Occupy Movement have collected tremendous attention, and for the first time there is market research data to measure the impact on the financial services industry. Javelin’s research aproximates that 5.6 million U.S. adults with a banking relationship switeched providers in the past 90 days. Of those switchers, 610,000 US adults noted Bank Transfer Day as their reason and actually moved their accounts from a large to a small institution. Javelin’s nine years of customer-transaction research insights has detected that people are highly resistant to moving their money, and even Huffington Post’s similarly-positioned 2008 “MoveYourMoneyProject.org” failed to barely even register in previous Javelin surveys. Despite of this, this time, Bank Transfer Day and the Occupy Movement did have a measurable impact.

Saudi Arabia's central bank will have a bigger role in the supervision of the country's financial sector as the kingdom weighs opening up its stock market to direct investments by foreigners.
The country's Capital Market Authority (CMA) signed a cooperation agreement with the central bank or Saudi Arabian Monetary Agency (SAMA) to coordinate supervision of the financial sector in order to improve its stability.
According to the agreement, the two entities will work together in the supervision of corporate governance, risk management measures, initial public offerings (IPOs), sukuk issuance and merger and acquisition regulations as well as the exchange of information.

Goldman Sachs International announced last September that it was going to the market to raise financing totaling $2 billion through a Murabaha sukuk issuance.
The issuance is based on a structure accepted by Dar Al-Istithmar Limited, the Shariah adviser to the issuer, Global Sukuk Company Limited, whose Shariah Supervisory Board is chaired by Hussain Hamed Hassan and includes Ali Al-Qaradaghi, Abdul Sattar Abu Ghuddah, Abdulaziz Fawzan Saleh Al-Fawzan and Aznan Hasan.
The issuance would have passed as a routine Murabaha sukuk save that the issuer was doing it on behalf of arguably the most high profile investment bank in the world, Goldman Sachs.

Saudi Arabia launched its first government-backed Islamic bond this week, for its aviation agency, establishing a benchmark for pricing of conventional and Islamic bond issues this year because of its size.
At $4 billion, it was the largest sukuk ever issued within the kingdom. The sukuk, guaranteed by the Saudi Ministry of Finance, was oversubscribed three times, and the Saudi General Authority for Civil Aviation will use the proceeds to finance the expansion of King Abdulaziz International Airport in Jidda.
The 10-year sukuk was sold in the domestic market, available only to Saudis.

It is possible that Azerbaijan will become a regional Islamic financing centre and play a significant role in boosting cooperation in Islamic banking with Persian Gulf and Central Asian countries.
introducing actively Islamic financing in Azerbaijan, the independent authority of the International Bank of Azerbaijan (IBA) on Islamic banking will begin its work in March, which plans to present six Islamic banking products to the market during the first phase.
The Islamic Corporation for the Development of the Private Sector (ICD) is also in talks to institute the first Islamic insurance company in Azerbaijan, Takaful.

The Security Exchange Commission of Pakistan (SECP)’s move to push Sharia-compliant Takaful risk coverage in Pakistan is probable to benefit millions and to triple the percentage of citizens with insurance coverage, in which Pakistan ranks lowest in South Asia.
Islamic insurance can benefit those who do not subscribe to conventional insurance, which is forbidden by Sharia Law.

It is possible that islamic banks or financial institutions can not compete with their conventional counterparts with respect to investment accounts since the returns cannot be guaranteed under Syariah or Islamic rules.
Hairul Azrin Hj Besar (pic), a senior lecturer of the national varsity's Faculty of Business, Economics and Policy Studies (FBEPS), states that one of the normal criteria which the investors are always seacrhing for in investment products is whether their capital will be intact, protected or whether there will be side effect or risk on their capital.

In 1999, fewer than 500 companies issued sustainability reports. Meanwhile, that number became now over 3,500.
Nowadays, there is a growing request for companies to prove a responsible, sustainable, long-term approach to business, to produce a statement of their sustainability activities, and to clearly ilustrate how this relates to their core business strategy. Corporate sustainability reports now include detailed performance metrics and reflect the priority companies have given to measuring and managing the impact of their operations.
Factors that have driven the current momentum for sustainable corporate performance are: stakeholder expectations, global standards, investor interest, natural resource constraints.

After Indonesia failed to sell the sukuk last year as investors asked for higher yields, the country plans to launch 2 trillion rupiah ($223.59 million) of project-based sukuk in the first half of this year.
Finance minister Agus Martowardojo, who gave the statement, added that the government posesses underlying assets of 5 trillion rupiah to issue project-based sukuk this year. Moreover, Indonesia is also aiming to issue a global sukuk at the end of the first half.

Hamood Sangour al Zadjali, xecutive president of Oman's central bank, stated that Islamic banking guidelines are set to be released by early February, while the Sultanate prepares for the launch of the two Islamic banks by June.
He added that they haven't yet received proper applications from banks as they are awaiting regulations to be issued.

Credit Agricole SA (ACA) has two mandates to administer Islamic bond sales in Saudi Arabia. The statement was given by c the bank's global head of Islamic banking.
He added the fact that one of the issues will be denominated in U.S. dollars.

Dubai Financial Services Authority highlighted the advantages of listing conventional bonds and Sukuk on the region's international exchange, at a forum attended by leading investment banks and law firms.
After the transfer of NASDAQ Dubai's Official List of Securities to the DFSA in October 2011, the event that took place at the Dubai International Financial Centre (DIFC) gave away details of the new listing and admission framework, giving issuers the ability to list debt in a streamlined manner under an aggressive timetable, comparable to listing regimes on other international exchanges.
NASDAQ Dubai is the only exchange in the Middle East that has direct access to Euroclear, an International CSD, supplying an easy transaction process with the NASDAQ Dubai CSD for international and regional investors.

Abu Dhabi government-owned Al Hilal Bank has validated the appointment of three banks to administer its debut $500 million Islamic bond issue, which will be launched later this year.
Mohamed Berro, chief executive, noted that the banks chosen for the issue are: National Bank of Abu Dhabi, HSBC and Standard Chartered Bank. Berro added that the issue would help fund the bank's growth and strengthen its balance sheet.

It appears that HSBC Saudi Arabia led a very successful SR15 billion ($4 billion) 10-year Sukuk issuance for the General Authority of Civil Aviation (GACA). The funds from the Sukuk launch will be used for the construction of the new King AbdulAziz International Airport in Jeddah.

It seems that Citigroup Europe is interested in entering into the sukuk market in Turkey. The statement came from Alberto Verme, the group’s Middle East and Africa (EMEA) board director.
Interest-bearing bonds are not permissible in Islam., so sukuk securities are structured to comply with the investment principles of Islamic law.

Tebyan Asset Management (Tebyan) launched its debut Tebyan CHIME Opportunities Fund (Fund). This is the first of its kind Shari'ah-compliant product to present investors a gateway to the emerging economic axis of the Arab-Indo-China regions.
The new Fund will be managed by Tebyan, established and regulated in the Cayman Islands and co-managed by Gulfmena Investments (Gulfmena) as Investment Manager who will supervise the MENA and Africa investments and Lion Global Investors (Lion Global).
The fund will cover what is known as CHIME (China, India, and Middle East).