IslamicFinance.de

Development Bank of Kazakhstan has lately decided to swap their 240 million-ringgit sukuk (five-year murabaha Islamic note) to U.S. dollars. The Astana-based bank already sold debt denominated in the Malaysian currency in July of this year, in order to prepare the dollar swap that comes due in August 2017.

Celcom has successful floated its sukuk issuance of RM5bil in nominal value, of which RM3bil received a final book. Celekom's officials also confirmed yesterday that their RM3bil sukuk has met with strong demand from asset management companies, financial institutions, insurance companies and corporate organisations.

Islamic financial body ASAS intends to globally launch a new scholar programme with aim to improve the financial literacy of scholars and this way to prevent the slowing of the industrial growth. In addition, it should be developed a global code of etics, in order to improve standards in the industry.

Malaysia's CIMB Islamic Bank defended its AA+/Stable rating on MYR 2 billion Tier-2 Junior Sukuk programme, issued by rating agency MARC . The programme rating is one grade lower than bank's financial institution rating of AAA. However, MARC confirmed the stable outlook for the rating of the programme, as CIMB Bank meets their expectations for the rating category.

Bank Islam Malaysia has allocated RM 200,000 in order to effectuate various welfare programmes fulfilling its commitment to corporate social responsibility (CSR) for Ramadan this year.

UK-based asset manager Aberdeen has launched its plans to arise two Syariah compliant unit trust funds to get onto the malaysian local retail market. According to the newest informations, the application process is in advanced stage. As industry sources familiar with the process claimed it would be an important addition to the Malaysia's Islamic financial landscape. Aberdeen Asset Management would be absolutely first fund manager to get a domestic asset management licence in Malaysia.

Indonesian central bank plans to strengthen payments on housing and automotive loans at Shariah banks. New requirements will be similar to those of conventional lenders for housing and vehicle loans issued on March 15. Due to new regulation, which took effect on June 15, it will be necessary to pay 25 percent for two-wheeled vehicles and 30 percent for four-wheeled vehicles as down payment.

Syarikat Takaful's profit soars to RM22.58mil. This is mainly due to higher sales generated by family products and improved investment income. The company's outlook for the current year is encouraging despite increasing competition on the market.

Malaysia was invited by Sudan in order to provide support in the country's efforts to set up Islamic banks on their territory. It shall help Sudan to facilitate trade and to ease investment financing between both countries. This move is considered as a sign of recognition of Malaysia as Islamic financial centre.

Today Bank Islam Malaysia Bhd presented to the Sabah Tithe Centre business tithe of RM120,979 for distribution to deserving recipients. Last year the bank also registered a pre-tax and pre-tithe profit amounting to RM470.1 million.

Reforms in the Malaysian pension system aiming to liberalise Malaysia’s pensions market have been announced. One of the newly introduced items is the voluntary Private Retirement Scheme (PRS). It will allow Malaysians to purchase a wide variety of products from private fund management firms, thus making it easier for them to focus on Islamic investment. The expected result of this move is a notable stimulation of the Islamic finance market. However, in order to bolster investor confidence in the sector, greater regulatory oversight will be necessary.

Indonesia plans to let Shariah-compliant banks hedge against exchange-rate movements. This way, the growth in Islamic financial assets will be stimulated and the gap with Malaysia’s industry will be narrowed. The instruments, available in Malaysia since 2006, have been approved by the Bank Indonesia, the National Shariah Board and the Indonesia Institute of Accountants. As a result of hedging, Bank Muamalat Indonesia will be able to hold more global bonds and issue more dollar loans.

The Turkish AV Havalimanlari Holding announced a consortium including TAV secured $1.2 billion in Islamic financing for Medina Airport. The financing facility was secured from Arab National Bank, The National Commercial Bank and The Saudi British Bank.

This week, sukuk yields have reached a seven-year low, the declines are expected to continue. As the main reason the strong support of the sukuk demand by Asia and the Gulf is pointed out. The average yields approach the levels of January 2005.

The AAA(s) rating of Muhibbah Engineering Bhd's RM130 million Islamic Bonds has been reaffirmed by RAM Ratings. Thus, Muhibbah's irrevocable and unconditional undertaking to purchase and cancel all the Islamic Bonds at the exercise price upon the declaration of an event of default is honoured. The support of Malayan Banking Berhad's guarantee will have a positive impact on the credit profile of the Islamic Bonds beyond Muhibbah's inherent or stand-alone credit standing.

In Malaysia, there was a discussion whether to continue tax incentives for Islamic finance or to use tax-break pick-ups to lubricate the sector. Since some of the incentives were aimed to make Islamic finance competitive with conventional finance, they should at some point be phased out. However, incentives which ascertain the equity between Islamic and conventional finance, should be maintained.

A huge number of experts in Islamic finance are needed due to continually emerging markets in India and abroad. Since already 75 banks all over the world have Islamic banking and finance branches, job opportunities for as much as 50,000 experts are open. Among these corporate banks are e.g. HSBC, Citigroup, Deutsche Bank and Standard Chartered.

Shortly after Securities and Exchange Commission of Pakistan (SECP) waived the previous conditions that forbade conventional insurance companies from launching Takaful operations, State Life Insurance Corporation came with news. The largest insurance company in the country plans to launch its own new range of Islamic insurance within a year. Currently, they are assessing target market for Takaful.

On time for Ramadan, Takaful IKHLAS Sdn Bhd just started its corporate social responsibility (CSR) programme which aims to demonstrate the value of helping one another. As part of the programme, bank representatives visited a poor familiy and grantd them RM500 in cash and daily supplies worth RM300.

Until now, Malaysia has been focusing mainly on the takaful business, wich is not concidered enough any more. Malaysian bank should offer more innovative Islamic financial products as well. According to Chief Executive Officer of the Islamic Banking and Finance Institute Malaysia (IBFIM) - Datuk Dr Adnan Alias - it is essential for the development of Islamic economics, finance and entrepreneurship to be enhanced.