IslamicFinance.de

Islamic lender Bank Asya has posted a net loss of 877 million lira ($335.58 million). The bank, in which Turkish banking regulators seized a small stake last week over an alleged illegal share sale, had posted a net profit of 180.6 million lira in 2013. Bank Asya has been battered by President Tayyip Erdogan's attempts to wipe out Gulen's religious movement, which he accuses of attempting to build a "parallel state". Regulators last month took over the bank's management after the government said it failed to meet some legal criteria.

RHB Islamic Bank Bhd has teamed up with Malaysian Technology Development Corp (MTDC) to provide financing for Bumiputera technology-based small and medium enterprises (SMEs) under the Bumiputera Expansion Fund (BEF) scheme. MTDC currently manages RM150 million fund for the BEF scheme via Bumiputera Agenda Steering Unit (Teraju). Under the pact, RHB Islamic will be the custodian of the fund, which will be placed in the bank’s commodity murabahah deposit-i account. The fund is expected to raise financing of at least RM300 million for eligible Bumiputera companies involved in biotechnology, green technology, nanotecnology and food technology.

A recent study conducted by the International Monetary Fund (IMF) has explored the possibility of using Islamic finance for increased financial inclusion. Their recently published paper entitled ‘Can Islamic banking increase financial inclusion?’ concluded that there was weak and tentative evidence of Islamic banking’s positive impact on some types of inclusion. The IMF paper sais improving financial infrastructure, introducing more competition in the banking system, improving the quality of credit information, and enhancing the efficiency of the legal system would be instrumental in improving financial inclusion across the continent.

Islamic International Rating Agency (IIRA) has reaffirmed national scale credit ratings of Bank of Khartoum (BOK) at 'AA-/A-1' (Double A Minus / Single A One). Outlook on the assigned rating is 'Stable'. The fiduciary score has been assessed in the range of '70-75', reflecting adequate fiduciary standards wherein rights of various fund providers are adequately defined and protected. Ratings derive strength from the bank's strong franchise and retail presence in Sudan, with an established history of rapid assets growth since acquisition by the present shareholders and into 2014. The bank maintains sizable liquid reserves, though liquidity management is constrained by systemic concerns.

The Central Bank of Iran (CBI) and CEOs of commercial banks reached an agreement that the institutions should not offer a deposit rate of more than 22%. The CBI has focused on restricting the monetary base and raising profit rates on participatory loans to curb inflation over the past 18 months. The policy has been a successful attempt as inflation dropped from 34.7% in the year up to March 20, 2013, to 15.8% in the year up to Feb. 20, 2015. However, Abbas Kamrei, a board member of Bank Melli, the largest state-run commercial bank, criticized CBI's interest rate policy as incorrect. He urged CBI officials to take into account the public expectations from banks.

Turkish banking regulators on Wednesday seized a small stake in the Islamic lender Bank Asya over an alleged illegal share sale. The banking watchdog said in a statement on Wednesday that Turkey's Savings Deposit Insurance Fund had seized preferred shares in Bank Asya held by a publishing company and a construction firm, citing irregularities in the sale of their parent company, Kaynak Holding, to a Dutch firm in January. The watchdog said that only preferred shares had been seized, but did not specify the size of that holding. The announcement came just hours after the ratings agency Standard & Poor's warned that actions against Bank Asya illustrated "the potential for political risk, or the perception of it, to directly or indirectly spill over into the financial system".

Qatar Islamic Bank (QIB) has announced the opening of its new headquarters in the United Kingdom for its subsidiary QIB -UK. The new five storey office is located at 43 Grosvenor Street in the Mayfair district. QIB -UK's focus is on supporting the investment and trade flows between Qatar and the UK. The firm offers real estate investment opportunities for clients looking to purchase premium properties in London. QIB -UK has assembled a team of real estate specialists to ensure clients are well placed to get premium real estate opportunities in the market. QIB -UK, was fully authorised as an Islamic Bank by the UK Financial Services Authority in January 2008, and is fully owned by Qatar Islamic Bank .

There are five Islamic banks operating in Pakistan. The significant shares of paid-up capital actually comes from the high net worth families and institutions in the Middle East, especially the six countries comprising the Gulf Cooperation Council (GCC). There are six countries - Kuwait, Saudi Arabia, UAE, Bahrain, UK and Singapore - from where individuals and institutions have invested in the five fully-fledged Islamic banks in Pakistan. Almost all of these banks are advised by the graduates of Darul Uloom Karachi, Jamiatul Uloom Islamia Binnori Town Karachi and Jamiatul Rasheed Karachi – well-known religious seminaries of Deobandi school of thought.

The Saving Deposit Insurance Fund (TMSF), which has seized Bank Asya, has determined the details of a precautions package. The bank will not be able to open new branches due to uncertainties in its liquidity structure. With the seizure by the TMSF, loan allocation and tracking processes and procedures will be improved. The new management assigned to the bank is striving first to preserve the current business and recover its customer portfolio. The information and documents submitted by the shareholders after the TMSF seized Bank Asya are currently being examined. Furthermore, criminal and judicial lawsuits will be filed against the previous management, which signed agreements that resulted in bad debt.

A plan is being floated on a “marriage” between Malaysia Building Society Bhd (MBSB) and Bank Islam Malaysia Bhd. Sources say the idea of a merger between the two is being mooted at the shareholder level of both companies, namely the Employees Provident Fund (EPF) and Lembaga Tabung Haji (LTH). A common factor the two companies have is Tan Sri Samsudin Osman, who is chairman of EPF and BIMB Holdings Bhd – Bank Islam’s listed parent company. BIMB wholly owns Bank Islam, which is its main income generator. Bankers say that if a merger is to take place, the EPF would be able to vote, unlike the situation in the failed merger with CIMB and RHB.

Indonesia's Bank Syariah Mandiri, a unit of state-owned Bank Mandiri, is targetting total assets worth 100 trillion rupiah ($7.72 billion) by 2017, up 49 percent from 67 trillion rupiah as of December, the Investor Daily newspaper reported, quoting Bank Syariah Mandiri finance director Agus Dwi Handaya.

Turkey's third-largest state bank Vak?fbank has received regulatory approval Tuesday from the Banking Regulation and Supervision Agency to establish an Islamic banking division. Vak?fbank will be allowed to set up a stand-alone Islamic unit capitalized at $300 million. After the approval, the bank has nine months to establish its banking unit according to Turkish law. Shareholders of the new Islamic bank will include Turkish Directorate General of Foundations, Bayezid Han-? Sani (II. Bayezid) Vakf?, Mahmud Han-? Evvel bin Mustafa Han (I. Mahmud) Vakf?, Mahmud Han-? Sani bin Abdülhamid Han-? Evvel (II. Mahmut) Vakf? ve Murad Pa?a bin Abdusselam (Murat Pa?a) Foundation.

Tunisia's El Wifack Leasing plans to become the country's third full-fledged Islamic bank by August and will receive a capital injection from the Islamic Corporation for the Development of the Private Sector (ICD). The ICD will not only provide technical assistance, but also inject up to 30 percent of the bank's capital, helping it increase its authorized capital to at least 150 million dinars ($77 million), El Wifack's general manager Mohammed Mellousse said. It will start offering sharia-compliant deposits through eight branches and build a network of 60 branches within five years, aiming for a 1.5 percent share of Tunisia's total banking market, he added. Currently, there are two full-fledged Islamic banks in Tunisia, Zitouna Bank and the Tunisian arm of Bahrain's Al Baraka Banking Group.

Afriland First Bank, the Cameroonian banking institution, has set high fundraising and loan approval targets for its Islamic finance clientele. Indeed, according to Youssoufa Bouba, the bank’s Director of Specialised Finance, Afriland First Bank is aiming to achieve 3 billion FCFA in Islamic checking accounts. Bouba goes on to state that the bank intends to grant 2 billion FCFA in loans at the same branch. These goals depend not only on the size of the Muslim population in Cameroon (the institution’s target market), which represents 20% of the population there, but also on the products the bank implements with private sector support provided by the Society for International Development (SID).

European Islamic Investment Bank PLC Wednesday said it has appointed Neil McDougall as its interim finance director. According to the company, McDougall is a qualified accountant who has held senior board and management positions at financial institutions including Europe Arab Bank and Commerzbank. The company has continued the search for a finance director after the appointment of Michael Warren Kidd, the chief operating officer of its majority-owned Rasmala Investment Bank and head of Strategy and Principal Investment at EIIB, fell through back in July of 2014. European Islamic Investment Bank shares were down 3.9% at 161.00 pence on Wednesday.

Islamic International Rating Agency (IIRA) has reaffirmed its Shari'a Quality Rating of AA (SQR) assigned to Jordan Islamic Bank ( JIB ). This rating indicates JIB 's conformance to very high standards of Shari'a compliance in all aspects of Shari'a quality analysis. The bank is supervised by an eminent Shari'a Supervisory Board, which comprises both Jordanian residents for ease of access, and those present on the group's Unified SSB, for international reach. The SSB regularly reviews activities of the bank to ensure Shari'a compliance. Transparency of financial reporting vis-à-vis investment accounts and corporate governance disclosures are mainly in line with the recommended best practices by IFSB.

Maybank Islamic has launched its Shariah Centre of Excellence (SCOE), which focuses on research and education, talent development, thought leadership and community welfare. Its chief executive officer Muzaffar Hisham said the center was a virtual centre, which aimed to be a repository of Shariah knowledge and reference point on best practices for industry players, academic fraternities and the general public. The bank has collaborated with INCEIF, the Global University of Islamic Finance, including sponsoring the university’s auditorium and post-graduate students. Maybank Islamic has also rolled out other programmes under the SCOE initiative, including a public lecture series as well as Islamic finance publications.

Warba Bank has announced that it successfully arranged $150 million Shariah-compliant one - year receivable backed syndicated financing facility for the International Bank of Azerbaijan. The Bank reported that it participated with a stake of $20 million in this transaction along with J.P. Morgan Bank, Citigroup, Barwa Bank, Al Hilal Bank, Noor Bank and Dubai Islamic Bank. he IBA concluded last year with $526 million sharia compliant assets compared to the Islamic Banking assets at the level of $220 million at the beginning of 2014. Behnam Gurbanzade, Director of the Islamic Banking Department of the IBA, recently said that the Bank is planning to increase the amount of Islamic financing in Azerbaijan in 2015.

Kuwait's Warba Bank has successfully arranged a US$150 million, Sharia-complaint syndicated finance facility for the International Bank of Azerbaijan ("IBA"). The facility has a tenor of one year with a bullet repayment due at maturity. Warba Bank has participated in this transaction with a stake of US$20 million in a consortium of six regional and international banks: J.P Morgan Bank, Citigroup, Barwa Bank, Al Hilal Bank, Noor Bank and Dubai Islamic Bank. In addition, Warba Bank has also announced its contribution of US$15 million in an Islamic Sharia-complaint facility amounting US$80 million arranged by HSBC for the Turkish Ozun Group. Moreover, the Bank sold its real estate investment in West Bromwich in the United Kingdom achieving net profit of KD 640 K.

The Central Bank of Nigeria (CBN) has finalised plans to opt for a centralised approach to regulate Islamic Banking in Nigeria. The CBN will set up an advisory body,known as the Financial Regulation Advisory Council of Experts, that will oversee the industry in Nigeria. The council will be tasked with ensuring all banking products that are designated as Islamic conform to sharia principles. The advisory body will comprise a minimum of five members who will serve renewable two-year terms, and are restricted from working for any other financial institution supervised by the central bank. Moreover, the Council will be guided by the principles of sharia governance issued by the Malaysia-based Islamic Financial Services Board.