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The proposed Shariah regulatory authority in the UAE will greatly benefit the local Islamic banking and finance industry an also help reduce the cost of institutions offering Islamic financial services, said Mubarak Rashed Al Mansoori, Governor of the UAE Central Bank. The proposed Shariah authority will have the key objective of – among others – issuing fatwa for products and services; introduce new and adopt existing international standards; documents regulations related to Islamic financial services; advise central bank on Shariah bank regulations to conduct monetary and financial surveillance. Al Mansoori said banks in the UAE have been innovative and creative in terms of introduction of the new Islamic products.

Khazanah Nasional Bhd is "not in a rush" to sell its 30% stake in Bank Muamalat Malaysia Bhd, under the proposed merger with Malaysia Building Society Bhd (MBSB). Khazanah's managing director Tan Sri Azman Mokhtar said the Malaysian state-owned investment arm's decision was incumbent upon the negotiated value for its Bank Muamalat stake. He cited the right price and the right configuration as requirements for a sale. DRB-Hicom Bhd holds the balance 70% stake in Bank Muamalat. According to Azman, as Khazanah is only a 30% shareholder in Bank Muamalat, Khazanah is not taking the lead in the merger talks. Khazanah will make a decision based on whatever they decide, he added.

Malaysia Building Society's (MBSB) planned merger with Bank Muamalat Malaysia is expected to create a financial services entity with a collective asset size of some RM60 billion. Affin Hwang Investment Bankwrote in a note today that MBSB and Bank Muamalat's assets were valued at RM41 billion and RM22 billion respectively. Nevertheless, there could be potential write-offs of the loan book subsequent to due diligence exercises, which is likely to follow suit. However, Affin Hwang also said they were not too optimistic about the merger, as previously there have been other merger discussions between Bank Muamalat and other parties that were unsuccessful.

A first-of-its-kind bank following Islamic principles was opened in Xining, capital of China's northwestern Qinghai province. The Jianguo Road Branch of Xining Rural Commercial Bank began operation as Muslims celebrate Eid-ul Adha tomorrow. Before opening, the bank invited an imam from the city's Dongguan Mosque to offer supervision in terms of Islamic doctrines, standard of behaviour and the use of Arabic translations in their services. The bank offers small-sum loans to Muslim customers at 15 per cent of average interest rate as well as guarantee and mortgage services for Mecca pilgrims.

The Nigeria Deposit Insurance Corporation (NDIC) has urged the management of Jaiz Bank to embark on public awareness and financial education on the benefits of non-interest banking practice to attract more customers. Alhaji Umaru Ibrahim, NDIC's managing director, informed the team that the corporation had developed a non-interest banking deposit insurance fund framework in May. He said that the framework was designed to create a level playing field and provide deposit protection for depositors involved in non-interest banking and protect them against any possible losses. In addition, he said that the corporation was in the process of appointing committee of experts to advise it on all issues relating to Deposits Insurance Scheme (DIS) for non interest banking.

Central Bank of Nigeria (CBN) has granted a na­tional licence to Jaiz Bank and a waiver on the reduc­tion of its liquidity ratio from 30 per cent to 10 per cent. The licence will enable Jaiz Bank operate in any part of the country. The Managing Director and Chief Executive of Nigeria Deposit Insurance Corporation (NDIC), Al­haji Umaru Ibrahim, informed that the corpo­ration had developed a non-interest banking deposit insurance fund framework in May 2015, in order to provide depos­it protection for depositors involved in non-interest banking, in addition to training its staff in Malaysia in this area of banking. The NDIC was in the process of ap­pointing a committee of experts to advice it on all is­sues relating to Deposits Insurance Scheme (DIS) for non-interest banking, he added.

Malaysian Electronic Payment System Sdn Bhd (MEPS) and its member banks will waive the fee for its real-time Instant Transfer, previously known as Inter-bank Funds Transfer (IBFT) service, from tomorrow – Oct 1 – to Dec 31. In a statement yesterday, MEPS said the zero fee was applicable for transactions on the Internet and mobile banking channels of the participating banks. However, the instant transfer fee at automated teller machines (ATMs) remained at 50 sen, it said. The initiative shows the banks’ and MEPS’ support for Bank Negara Malaysia’s (BNM) e-Payment adoption. By 2020, BNM is targeting to increase the number of e-payment transactions per capita from 72 to 200.

The Bank of Ghana is in the process of licensing Islamic Bank, which is expected to provide interest free loans to its customers across the country. The Central Bank Governor, Dr Henry Kofi Wampah, told journalists at a press conference in Accra that the Banking Supervision Department of his outfit is working assiduously to issue new banking licenses to Islamic Bank, as well as the Ghana Armed Forces Bank by the close of the year. Research from Lotus Capital Limited in Nigeria shows there is a growing appetite for Islamic finance as approximately 30 per cent of the Muslim population around the world would be interested in Islamic finance. Nevertheless, the operations of Islamic banks give rise to a unique set of risks, in addition to the standard risks associated with banking activities.

Le gouverneur de Bank Al Maghrib, Abdellatif Jouahri, a assuré que le Comité des établissements de crédit a reçu plusieurs demandes d'agréments de la part d'institutions étrangères pour l'implantation de banques participatives au Maroc. Pour la plupart, il s'agit de banques du Qatar, d'Arabie Saoudite, du Bahrëin et du Koweit, qui veulent collaborer avec des banques de la place, pour certaines, et s'implanter au Maroc, pour d'autres. Toutes les demandes seront traitées selon des critères spécifiques, comme la capacité à réaliser un bon rendement. D'autres banques internationales ont également manifesté leur intérêt pour le Maroc, notamment HSBC, qui a déjà reçu une autorisation pour ouvrir ses portes au royaume.

Indonesian regulators have launched a plan aimed at growing the sector, which currently accounts for less than five percent of banking assets, compared to a quarter in Malaysia and around half in Saudi Arabia. Authorities believe it is a good moment, with many Indonesians getting wealthier after years of strong economic growth and an increasing trend towards piety across broad sections of society. The Financial Services Authority (OJK) is spearheading the drive, and unveiled a five-year roadmap earlier this year that included plans to educate the public about Sharia’h lenders and the establishment of an Islamic finance committee to better manage the sector.

Al Rayan Bank is renewing its commitment to Birmingham as it gets set to relocate to a new head office in Edgbaston. The bank has purchased offices in Calthorpe Road and will move 100 of its employees from its current leased offices later this month. In February 2014, Al Rayan Bank was acquired by Masraf Al Rayan, the second largest Islamic bank in Qatar by market value. A rebrand followed before the bank posted its financial performance. In 2014, the bank’s operating income increased by 168%, customer financing increased by 86% and retail deposits increased by 59%. The bank also transformed a £5.5m loss in 2013 to an after tax profit of £1.2m.

Qatar National Bank (QNB) has halted preliminary talks with Kuwait Finance House (KFH) to buy its Malaysian unit, the Gulf Arab region's largest bank said. An agreement has not been reached. Earlier, KFH's chief executive Mazin al-Nahedh had said the bank had ruled out a sale or merger for its Malaysian unit, adding the largest Islamic bank in the Gulf Arab state will begin restructuring the unit with immediate effect. The disclosure from KFH comes after a source familiar with the matter said last week that QNB had bid to buy the unit, with the Qatari lender later acknowledging it was in early talks about an acquisition.

CIMB Group Holdings Bhd is expected to appoint Rafe Haneef, who currently heads HSBC Amanah Malaysia Bhd, as the new chief executive officer of its Islamic banking arm CIMB Islamic Bank Bhd. It is understood that Rafe has tendered his resignation, after almost five years of helming the foreign Islamic lender. The appointment is still in the process of getting Bank Negara Malaysia’s approval. CIMB Islamic Bank has been without a captain ever since Badlisyah Abdul Ghani resigned as its CEO and board member in July. CIMB Islamic Bank then appointed Mohd Shafri Shahul Hamid as the person in charge of the bank while it looked for a new CEO.

Kuwait Finance House (KFH) has ruled out a sale or merger for its Malaysian unit, its chief executive said on Tuesday. Mazin al-Nahedh added the lender, the largest Islamic bank in the Gulf Arab state, will begin restructuring the unit with immediate effect. The disclosure from KFH comes after a source familiar with the matter said last week that Qatar National Bank had bid to buy the unit, with the Qatari lender later acknowledging it was in early talks about an acquisition.

Dubai-based bank Emirates NDB has expressed interest in spending $300 million to establish Islamic banks in Indonesia as it seeks to tap into the archipelago's underdeveloped financial sector. Emirates NDB would join Middle Eastern banking rivals Qatar's Masraf al Rayan and Dubai Islamic Bank in its quest to set up shop in the nation. Emirates NDB will have to team up with local partners in order to fulfill its aim of establishing a new bank as a current government regulation limits foreign ownership to 40 percent, said Dhani Gunawan, OJK director of Islamic banking research and development, supervision and licensing. Meanwhile, Al Rayan seeks to acquire shares in existing Islamic banks, he added.

Abu Dhabi Islamic Bank (Adib) said on Monday it has raised Dh504 million in its rights issue, which was nearly three times oversubscribed, with Dh1.46 billion in subscriptions received. Following the close of the subscription period on September 10, all 168 million shares were fully subscribed, the bank said in a statement. The rights, which were traded on the Abu Dhabi Securities Exchange, offered investors Adib shares at a price of Dh3 per share, and are part of the bank’s plan to raise capital to support growth.

There are some misconceptions about Islamic banking in Oman, which need to be dispelled through raising awareness about this sector, Dr Jamil El Jaroudi, chief executive officer of Bank Nizwa said. El Jaroudi noted that they do not want to simply replicate what is out there in the conventional banking and continuously try to innovate and build an industry based on Sharia objectives, and not necessarily just to be Sharia-compliant. However, during the initial phase, they do have to provide alternatives to the current conventional products to suit the demand of customers, he added. Another misconception is that Islamic banking is similar to a social philanthropic entity. Nevertheless, Islamic banks are commercial and profit oriented businesses.

The enforcement of the Islamic Financial Services Act by Bank Negara Malaysia in June to distinguish between deposit and investment accounts offered by Islamic banks will pave the way for the introduction of new retail products. The development of the Islamic finance sector in Malaysia has enjoyed the support of the government, which has announced the RM150 million Investment Account Platform under Budget 2015. The platform, which is slated to start on Sept 1, is a shariah-compliant investment product designed to attract institutions and individuals to invest in the country's Islamic financial markets.

The house of Representatives has started discussing a proposal to allow other Islamic banks to operate in the Philippines, in an attempt to put it at the same level as commercial banks. The House committee on banks and financial intermediaries yesterday took up a proposal amending the charter of the Al-Amanah Islamic Investment Bank, which is currently the only Islamic bank in the country. House Bill 5989 seeks to amend Republic Act 6848 by breaking the monopoly of Al-Amanah bank, which would give the green light for the Bangko Sentral ng Pilipinas (BSP) to authorize new entities to come in. The Al-Amanah bank remains a fully owned subsidiary of the Development Bank of the Philippines.

The State Bank of Pakistan (SBP) has issued ‘Certificate of commencement of banking business’ to MCB Islamic Bank Limited, a wholly-owned subsidiary of MCB Bank. As of June 30, Islamic banking business of MCB was operating with a network of 34 branches having an asset base of Rs21.015 billion. The MCB’s Islamic banking business posted a net profit of Rs408.228 million for the half-year ended June 30, 2015. To augment the existing growth momentum, SBP has prepared the “Strategic Plan for the Islamic Banking Industry of Pakistan 2014–2018”. The plan focuses on initiatives necessary to raise awareness and knowledge about Islamic banking.