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#Kuwait’s Noor Financial Investment is considering the sale of its 49% stake in Pakistan’s largest Islamic lender Meezan Bank. The stake has a market value of about $396 million at the current market price, according to data compiled by Bloomberg. Noor Financial hired advisers to assess opportunities, but it has not tasked the consultants with either increasing or decreasing its stake in Meezan Bank. Shares in Noor Financial gained 5.9% by 12:30 p.m. in Safat, Kuwait, the highest since April 16. Meezan advanced 3.6% in Karachi trading to a record high.

Finance Minister Abul Maal Abdul Muhith said that the board of directors of Islami Bank Bangladesh has been engaged in an internal row. The row is over the appointment of new staff, that Islami Bank Vice-chairman Professor Ahsanul Alam claims were made on paying bribes. Due to the row between him and chairman Arastoo Khan, two groups in the board have also been created with the 21 directors supporting either Arastoo or Ahsanul, and each group calling the other a liar. In a statement released on May 20, nine directors threatened to resign from their posts. Professor Ahsanul Alam has claimed that three directors who are abroad have also opted in support of this statement.

The Islamic Corporation for the Development of the Private Sector (ICD) signed a Memorandum of Understanding (MOU) with City Bank Bangladesh in order to strengthen their collaboration. The signing ceremony was held at the 42nd Annual Meeting of the IDB Group in Jeddah, Saudi Arabia. The MOU was signed by the CEO of ICD, Mr Khaled Al Aboodi and Mr Sheikh Mohammed Maroof, Deputy Managing Director and Mr Mohammad Mahbubur Rahman, Chief Financial Officer of City Bank. The collaboration will encompass the areas of Term Finance, Public Private Partnership transactions, Lines of Finance and other areas. The signing ceremony was also attended by Mr Farid Masmoudi, Director of ICD, Mr Mahbub Jamil, Head of Structured Finance of City Bank and other high officials of both institutions.

Dear Reader,

regular readers may remember my critic on bitcoin from an Islamic perspective missing intrinsic value. The former blog entry you find here: http://www.islamicfinance.de/?q=node/7840 - almost two years ago.

So far bitcoin just went up higher and higher, with wild fluctuations but nevertheless.

It reminds on how bubbles work, think about the tulip mania in 1637 a nice piece of economic history. A single tulip bulb was traded and bought on credit. Check the Wiki page on it:

https://en.wikipedia.org/wiki/Tulip_mania

As bitcoin has even less value than a tulip except for payment purposes, it is the payment functionality, which can lead to destruction. What happens if a new alternative currency is becoming en vogue, which has a better usability and faster transaction time? In my view this is most likely trigger to burst the bubble.

FT Alphaville covers now the difficulties coming up with bitcoin's increasing transaction numbers causing inconvenience in using the digital currency:

https://ftalphaville.ft.com/2017/05/17/2188961/the-currency-of-the-futur...

Islami Bank Bangladesh has removed the head of its human resource division amid a war between the old guard belonging to Jamaat-e-Islami and newly-appointed executives. The removed executive, Md Mahboob Alam, is also an executive vice president of the bank. The bank's board of directors took the decision to remove him from the division on Saturday. The new leadership of the bank are fighting for control of the bank with Jamaat supporters after taking charge five months ago. Vice-Chairman Professor Syed Ahsanul Alam Parvez said Mahboob was removed from the human resource division because he was appointing Jamaat loyalists to top posts of the bank. Another director, Professor Dr Qazi Shahidul said that Jamaat supporters were conspiring in various ways because they plan to take back control of the bank after changes through the next election.

With a strong background in Middle Eastern banking, Burj Bank has been building a solid reputation based on integrity. Burj Bank was founded in 2007 under the name of Dawood Islamic Bank as a central pillar of Pakistan’s Islamic Banking landscape. In 2011 the bank was renamed and launched as 'Burj Bank Limited', following a massive capital injection by some Middle Eastern investors of the bank. At present, almost 85% of Burj Bank’s shareholding stems from the Middle East, with majority ownership belonging to the Islamic Corporation for Development of the Private Sector (ICD). In 2012 Burj Bank grew its deposit base by 77% and the financing portfolio also reflected a growth of 67%. The branches grew from 50 to 75, reflecting a percentage distribution network growth of 50%. The bank has entered into diverse new lines of business including SME (small- and medium-sized enterprise) banking, investment banking, agricultural financing, cash management and home Musharaka.

The Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) will develop a package of standards covering Islamic endowments or awqaf. AAOIFI did not give a time frame for the completion of its awqaf standards, but said its board had discussed and approved specifications regarding the accounting standards. The plans are part of wider industry efforts to modernise awqaf, which receive donations to operate specific social projects, such as mosques, schools and welfare schemes. Most awqaf do not disclose full financial figures, although their underperformance is believed to be considerable. In India, awqaf are estimated to own 490,000 properties but their estimated annual income is just 1.63 billion rupees ($25.22 million.)

The Securities and Exchange Commission of #Pakistan (SECP) announced that it was relaxing regulations for Sukuk issuance in order to develop the Shariah-compliant market. The regulator said the SECP was amending the 2015 Issue of Sukuk Regulations to facilitate the issuers, reduce the cost of issue and ease the regulatory burden. The SECP has invited public opinion on the proposed amendments before their finalisation. The commission has also advised the PSX to come up with proposals for reducing the cost of market-maker for Sukuk issuance, rationalising the minimum size of public offer portion to reduce the cost of issue and organising a seminar with potential issuers to widen awareness. According to the SECP, the Sukuk market has been performing below potential in Pakistan. While the demand is substantial, supply remains short.

Zaman Bank is expected to enter Kazakhstan's Islamic banking services market in near future. The news was announced by Nurlan Abdrakhmanov, director of the financial market methodology department of Kazakh National Bank. He noted that among all the products of Islamic banking, murabaha is in the greatest demand in Kazakhstan.

The Iranian Ministry of Economy has published the details of letters of credit (L/Cs) that Iranian banks allocated over the past few years. The country’s international trade picked up considerable pace when the sanctions against Iran were lifted. According to the ministry’s report, Bank Melli Iran allocated 154 letters of credit worth $42.71 million over a four-year period (2013-16). During 2013-16, Bank Keshavarzi opened 19,253 L/Cs worth over $10.5 billion. It also played an important role in issuing 21 bank guarantees valued at $15 million. Bank Mellat also issued 32 export guarantees worth $15.4 million and four import guarantees worth $13.5 million. Export Development Bank of Iran opened 550 L/Cs and issued more than 1,750 bank guarantees during 2013-15 to emerge as one of the main forces in the Iranian economy.

The secretary general of the IFSB will retire next week, according to a statement. Jaseem Ahmed will step down middle of April after leading the IFSB 6 years.
The process for the selection of a new secretary general has begun. Zahid ur Rehman Khokher acting as interim secretary general.

The IFSB sees growing demand for fintech within the Malaysian Islamic financial services system, because customers are looking for alternatives.
IFSB secretary-general Jaseem Ahmed said „demand for fintech within Islamic finance had increased following the global financial crisis“ and further that “There are tremendous opportunities for fintech within Islamic finance. In the aftermath of the global financial crisis, there has been a loss of confidence, so people are looking for alternatives,”
Jaseem added that commercial banks are really taking up fintech to reach out and improve the attractiveness of their products at a lower cost and also said that he expected sukuk issuance to continue remaining strong in Malaysia.
The IFSB event, which ends tomorrow, comprises forums that bring together key stakeholders of the Islamic financial services industry.

GCC is expected to account for about 31% of sovereign bond issuances from emerging markets this year. The expected 2017 sovereign issues will be distributed among GCC, Eastern Europe Middle East Africa and Latin America, according to forecasts by Bank of America Merrill Lynch.
Issues from the GCC has been increasing rapidly mainly due to low oil prices, with some new issuers in 2016, and analysts expect the 2017 issuance to continue to be high. Among those, Kuwait inaugurated the external sovereign debt market with $8 billion (Dh29.3 billion) to finance a budget deficit resulting from low oil prices. Sovereign issuance for 2017 is forecast to be 6% higher compared to the previous year. In 2016, sovereigns issued $135 billion, mainly from Latin America, while corporates issued about $300 billion, mainly from Asia. Analysts expect gross sovereign external issuance to come in at $144bn in 2017.

Pakistan's central bank has updated guidance on sharia governance for Islamic finance institutions. The goal is to expand the scope of external audits to help mitigate conflicts of interest and increase transparency. Those religious scholars who are members of an Islamic bank's sharia board are now barred from serving in any external audit firm. From now on, external sharia audits will have to cover pool-management practices and technology systems. This includes the way Islamic banks calculate distribution of profit and loss to depositors, the tracking of assets, and the allocation of income and expenses. The move is designed to separate the verification of profit and loss distribution between the banks and the external auditors, in contrast to the joint verification that was allowed under earlier guidance.

The Islamic Corporation for the Development of the Private Sector (ICD) and TUV SUD signed a memorandum of understanding (MoU) to foster their joint operations in the countries of Central Asia. ICD's CEO Khaled Al-Aboodi and the managing director of TUV SUD Central Asia, Anar Ahmadov, signed the MoU on behalf of the two corporations in Astana, Kazakhstan. The aim of the MoU is to facilitate cooperation in promoting private sector participation and inform about business opportunities in countries of Central Asia. This partnership will enable the two institutions to work closely on market studies related to the transit and logistic sector in the common member countries.

ZPay, a payment application for foreign tourists in Iran, has won Bank Pasargad Iran’s award for best fintech innovation at the First Fintech Festival. ZPay enables foreigners to shop in Iran while keeping their money outside the country. Iran is doing much to improve its fintech standing. Earlier this month, it was reported that Iran had launched a FinTech Association to push for further development. And yet, while the capital Tehran is home to a growing number of local fintech startups, Iran still has a long way to go before it can be considered a fintech hub.

On Feb. 26 the Iranian government got the parliament approval to sell a total of 10 trillion rials ($308 million) worth of excess properties owned by its ministries. The raised money is expected to help shore up the troubled Post Bank of Iran and the Cooperative Development Bank. According to economic newspaper Donya-e Eqtesad, toxic assets account for 40-45% of total banking assets in the country. Nearly 15% of these assets consist of immovable assets such as land and buildings. The rest consists of nonperforming loans and government debt. The sale of at least 33% of the surplus assets could have taken place in the fiscal year running to March 20, but banks eventually decided to find a legal way to postpone the sale process. Real estate expert Farhad Beizaei accused banks of wasting time so that they can sell properties at higher prices next year.

According to Bangladesh Bank's former deputy governor Khondkar Ibrahim Khaled, Islami Bank Bangladesh speaks about Islamic banking, but it does not act in that way. In his view, the private bank is not following Islamic banking rules of keeping customers as partners of profit or loss. He also alleges that remittances are dropping due to 'dishonest' mobile banking abroad. The statements were made at a seminar in Dhaka where several professors of Bangladesh Institute of Bank Management (BIBM) were present. Khaled said that remittances were dropping because money is being sent through illegal channels in the name of bKash. He advised the Bangladesh Bank to open a new wing to research mobile banking in order to stop transactions outside banking channels. In a research paper published at the seminar, it was said that a large section of the customers of Bangladesh's banks did not have clear ideas about the sector.

BankIslami Pakistan and fintech startup CompareOn Pakistan have signed a strategic alliance that will further enhance BankIslami’s reach. CompareOn Pakistan provides the online comparison platform Karlocompare.com.pk, which delivers product information and enables customers to apply without the need of visiting or calling BankIslami branches. The agreement was signed by Sumair Farooqui, CEO of CompareOn Pakistan and Yasser Abbas, Head of Islami Auto Finance. Speaking on the occasion, Sumair Farooqui said CompareOn Pakistan intends to serve the growing customer base of Auto Financing Industry and contribute to enhancing awareness around BankIslami’s products.

The Reserve Bank of India (RBI) has said it cannot disclose the Finance Ministry's response about the introduction of Sharia banking in India. The RBI had earlier proposed opening of Islamic window in conventional banks for gradual introduction of Sharia- compliant or interest-free banking in the country. RBI was asked to give the copy of the letter sent to it by the ministry on the recommendation of its Inter Departmental Group (IDG) regarding Islamic banking.
The central bank had sought response from the Department of Financial Services (DFS) under the finance minister whether their letter can be disclosed under the Right to Information (RTI) Act. As advised by the DFS, the disclosure of information would cause a breach of privilege of Parliament or the state legislature.