IslamicFinance.de

Bahrain-based Khaleeji Commercial Bank (KHCB) has announced the appointment of Mr Khalil Ismaeel Al Meer as the bank's new Chief Executive Officer. Prior to his appointment, Mr. Al Meer was General Manager of Corporate Banking division in BBK. He has over 28 years of experience in corporate banking, gained in senior roles at National Bank of Bahrain and Bank of Bahrain and Kuwait. He holds a B.Sc. in Business Administration from the University of Bahrain. He also attended the Gulf Executive Development Program at Darden Graduate School of Business in University of Virginia (USA) and the Senior International Bankers Program of the International Centre for Banking and Finance Services at Manchester Business School (UK).

Bankers in Iran are hoping that new President Hasan Rouhani will reform the banking industry, which is saddled with dangerous levels of bad debts. A veteran of the Iranian banking sector said that at least 50 per cent of the financial institutions do not deserve to be saved. Over the past eight years both public and private banks have run up huge amounts of bad debt. These are now putting a heavy strain on the government's shrinking financial resources as it protects the most indebted players from bankruptcy. Bad debts in the banking system are estimated to average about 20 per cent, with big institutions Bank Saderat and Bank Melli in the worst positions. Interest rates on deposits will need to rise in order to combat inflation and absorb excess liquidity in the economy. Rates were raised in 2012 to 21 per cent for the same reason, but to little effect, and the cost of funding for banks is high.

Nigerian Jaiz Bank has increased its branch network to ten, with the commissioning of its Katsina branch this week by the state governor Alhaji Ibrahim Shehu Shema. The bank now has branches in Gombe, Maiduguri, Katsina, and an additional branch in Kano, making two branches in the state. The bank has also added two branches in Abuja, the Federal Capital Territory. The branches are located at the National Assembly and Wuse District. Commissioning the bank yesterday, the governor promised to identify and support the operations of the bank.

Pakistani BankIslami more than offset the negative effect of discount rate cuts by an growth of 24 percent and 72 percent in its investments and financing, respectively. However, the costly fixed deposits drove up the bank’s mark-up expenses squeezing its spread ratio to 40 percent in 1H CY13 from 43 percent in the corresponding period of last year. Moreover, During 1H CY13, the non-performing loans (NPLs) swelled by 31 percent year on year. Resultantly, provisioning expenses mushroomed by more than four times in 1H CY13. Besides, the bank has been working aggressively to enhance its branch network which piled up bank’s non-mark-up expenses. Whether or not, BIPL enjoys the discount rate hikes will largely depend on how it works on is to improve its CASA (low-cost deposits) and curb its surging NPLs.

Abdonnaser Hemmati has been elected by the board of directors of Bank Melli Iran as the bank’s new governor, replacing Farshad Heidari. Heidari had been appointed as the governor of the bank after Mahmoud Reza Khavari, its former governor, fled to Canada after a $2.6 billion financial fraud case was uncovered in 2011. Economy minister Ali Tayyebnia is scheduled to officially install Hemmati at the post by Friday. Hemmati has served as the managing director of Sina Bank and the chairman of Iran’s Central Insurance Company.

Al Baraka's Turkish subsidiary, Al Baraka Turk Participation Bank, has concluded a syndicated Sharia compliant Murabaha financing, raising a total of $196m and EUR 175.5m. A total of 23 banks from 15 countries participated in the facility, managed by the lead arrangers Standard Chartered Bank, Noor Islamic Bank (Dubai), ABC Islamic Bank (Bahrain), Barwa Bank (Qatar) and Emirates NBD Capital (Dubai). Meanwhile, the Bahrain All-Share Index slipped 0.20% to 1,194.88 points on Sunday. Al Baraka Banking Group closed even at $0.725.

Bank Dhofar, has announced the resignation of its chief executive Anthony Mahoney for personal reasons, effective September 26. The Omani lender has appointed Abdul Omar Al-Ojaili as its acting chief executive. Bank Dhofar is planning to merge with Bank Sohar with a view to creating Oman’s second-largest bank. The new entity would have total assets worth 4.1 billion rials ($10.7 billion), according to quarterly financial statements, and a market capitalisation of around $1.8 billion. Bank Dhofar shares have risen 14 per cent year-to-date.

Managing director of the Iran's Melli Bank, Farshad Heydari has been removed from his position by the Bank's Association. The embezzlement case originally started back in 2007 by Amir Mansour Arya Investment Company and progressed in 2010, after some Iranian major banks, including Bank Saderat and Bank Melli, issued loans for the company.

Nova Resources Limited has agreed to sell its entire stake in European Islamic Investment Bank to Pearce Global Investments Limited, for a total consideration of GBP663,892. The Bermuda-based company said that the consideration is to be paid by the transfer of warrants over 9.0 million shares in Tricor PLC, the AIM-list investment company focussed on the natural resources sector. Nova said that the shares can be exercised at its discretion by the end of 2017, at an exercise prices of 0.5p, although it intends to retain the warrants for the foreseeable future. Nova said the warrants are valued at 7.38p apiece, representing a premium on Tricor's current share price of 6.50p at the time of the agreement.

Shariah banking offers an opportunity for Africa's existing banks. In Kenya, the Gulf African Bank and the First Community Bank experienced exceptional growth. Standard Chartered said it would soon start offering Islamic banking products in Kenya. As African banks embrace Islamic practices, regulatory bodies are scrambling to issue Shariah-compliant policy statements and rules. Nigeria brought in new guidelines to help deal with sukuk and guidelines were established to deal with takaful. South Africa has rewritten its tax laws to ensure that Shariah-compliant products are more transparent. Uganda, Botswana and Zambia are also looking to make regulatory changes to grow their Islamic banking sectors.

The Governor of Zamfara State, Alhaji Abdul’aziz Yari, has said the state would invest the sum of N1.5 billion in Jaiz Bank to shore up the financial institution’s capital base. Speaking in Gusau while inaugurating the bank's 11th branch since it started operations in January last year, he urged citizens of the state to patronise the bank in order to realise the gains of non-interest banking. Moreover, the governor said local government funds would be invested in the bank. People will be mobilised through the mass media to educate them on the importance if the bank, he added. Meanwhile, the Chairman of the bank, Alhaji Umaru Mutallab, expressed appreciation to the governor for his interest in the bank.

International Bank of Azerbaijan (IBA) is the first European bank to present the Qibla card, which corresponds to the rules of Islamic banking. IBA Islamic Banking Department head Behnam Gurbanzade said the card will be released into circulation in the near future. The cost of the card is 40 manats. The debit card was issued in conjunction with MasterCard Platinum. It is equipped with an electronic compass indicating the direction of Mecca. With the help of this card, the card holder will be able to cash funds in the account, as well as pay for the purchase of various goods and services. Qibla card will be issued as a debit card, but can also be used with a limit of debt, issued by the bank.

Moody's Investors Service has today taken actions on National Bank of Bahrain, BBK, BMI Bank and Bahrain Islamic Bank. The ratings agency has confirmed that National Bank of Bahrain (NBB) and BBK received Baa2/Prime-2 deposit and senior debt ratings, with a negative outlook. Regarding BMI Bank, Moody's has extended the review for downgrade on the bank's Ba1 deposit rating, and affirmed the bank's standalone E+ bank financial strength rating (BFSR) with a stable outlook, equivalent to a baseline credit assessment of b1. In addition to these actions, Moody's has also extended the review for downgrade on all the ratings of Bahrain Islamic Bank (BIsB) to reflect its extensive capital needs and ongoing uncertainties around the recapitalisation of the bank.

Islamic banking industry grew by nearly seven per cent during the second quarter of the calendar year 2013. The momentum in growth, however, started weakening due to increasing base, according to the Islamic Banking Bulletin of the State Bank of Pakistan. The report said the asset base of the industry reached Rs903 billion, registering year-on-year growth of 27pc, while deposits grew by 28pc to reach Rs771bn by the end of June 2013. Profit of the Islamic banking industry reached above Rs4.3bn by the end of June 2013, though lower compared to Rs5.9bn profit registered during June 2012, said the bulletin. During the quarter under review, non-performing financing (NPF) of Islamic banking industry witnessed a slight decline and was recorded Rs19.4bn compared to Rs19.5bn in the previous quarter.

The Bangko Sentral ng Pilipinas (BSP) is planning to open up the its rediscounting window to sharia lending entities, essentially a mechanism that allows lenders to exchange their loan receivables for cash but at a discount, effectively giving them cash that they then use to turn around and give even more loans. The sharia rediscounting window forms part of a larger effort to achieve an inclusive financial system that delivers financial services not only to the unbanked but also to the Muslim community. Moreover, the BSP is preparing to draft new rules for the BSP to extend its financial services to Islamic banks that are in accordance with the provisions of Islamic banking. The draft bill has already been submitted to the Senate and the House of Representatives.

Growth of Shariah-compliant banks in Qatar is poised to outpace that of the UAE lenders as borrowing rises amid $200bn in government spending for the 2022 soccer World Cup. Qatar's four Islamic lenders will almost double their asset base to $100bn by 2017, Standard & Poor's has said in a report. Last year, the assets of the largest Shariah-compliant bank in the country, Qatar Islamic Bank, grew five times faster than those of the biggest one in the UAE, Dubai Islamic Bank. Spending for the world's most-watched sporting event will spur lending for roads, stadiums and hotels.

A task force to encourage British banks to establish sharia-compliant products, aims to position London as a Western hub for a fast-growing Islamic finance sector. The country hopes to step up the challenge to Islamic finance centres such as Dubai and Kuala Lumpur and wants to be the leading (Islamic) finance sector outside of the Muslim world. It will make it easier for banks in London to have Islamic products. Britain currently has 22 financial institutions, including five fully sharia-compliant banks, offering Islamic finance products, and 30 London law firms offering expertise on the sector.

BAJ’s financial strength rating has been affirmed at “BBB” with a stable outlook. The bank’s long-term foreign currency rating has been affirmed at “BBB+” and its short-term foreign currency rating at “A2.” The ratings agency Capital Intelligence noted BAJ’s sound liquidity, strong customer deposit growth and improved profitability and highlighted the benefits of a reviving equity market to BAJ’s business. Nabil Al-Hoshan, CEO and MD of the Bank, was pleased that the banks strong underlying fundamentals had been recognized with this affirmation.

Maisarah, Islamic window of BankDhofar announced the launch of Oman's pioneering Sharia compliant priority banking services. Maisarah's teams of relationship managers are offering special products and personalised services. Ease of access is one of the features among other privileges that Maisarah has to offer through priority banking centers in the Muscat and Dhofar region. Customers can reap the benefits of savings accounts based on the Mudharaba contract as well as auto financing based on the Murabaha concept without lengthy procedures at preferential prices and services. Under the guidance of the Sharia compliant Board of Directors, Maisarah's banking solutions are on display at their stand-alone branches, which have been designed to minimize wait time and enhance each customer's experience.

Standard Chartered has appointed Christos Papadopoulos as chairman of Standard Chartered Saadiq Islamic Banking. Christos, currently the Bank's Regional CEO, Middle East, North Africa and Pakistan, will take on additional responsibility for the Islamic banking business as its Chairman and continue to be based in Dubai. He has been with Standard Chartered for seven years and was previously Global Head, Financial Institutions prior to being appointed Regional CEO in 2010.