IslamicFinance.de

Liquidity Management Centre (LMC) has announced 18 per cent increase in the net profit at $4.22 million for last year when compared with $3.57m for 2013. This resulted in a return on capital equivalent to approximately 8pc while the average one-year interbank rate remains below 0.75pc. Total operating income was $10.11m as against $10.57m for 2013. Net profit for the fourth quarter was $847,000 versus $784,000 for the same period in 2013. Portfolio-based activities saw a growth of approximately 13pc while the bank's balance-sheet continues to see significant improvement in terms of asset quality and liquidity. Shareholders' equity grew by 7.18pc from $62.96m as of 2013-end to $67.48m as of December-end last year.

Some firms are starting to combine sukuk, using portfolios of long-term issues to back short-term certificates. This lets them create liquidity programmes that address the persistent shortage of money market instruments needed by Islamic banks to manage their short-term funds. Such is the approach used by Bahrain-based Liquidity Management Centre (LMC). The programme is uses an SPV (special purpose vehicle) where all the sukuk are booked. The SPV is fully backed by sukuk of different tenors and rates. A similar format is to be used by the Malaysia-based International Islamic Liquidity Management Corp (IILM), where all of the assets will be either sovereign, sovereign-linked or supranational assets. If these programmes gain traction they could open the door to additional layers of securitisation.

Liquidity Management Centre (LCM) has announced its results for the first quarter ended 31st March 2013. The insitution recorded a net profit of USD 1.427 million compared to a net profit of USD 0.511 million for the same period of the year 2012 resulting in a 179.25% increase in the net profit. The average interbank rate remains below 0.5%. Moreover, the total operating income recorded an amount of USD 3.181 million in comparison to USD 1.958 million for the same period in 2012. The positive results were due to various advisory services provided for transactions for Islamic Banks and corporations in the region and a portfolio of Sukuk and equities with a diversified investment approach. The Bank's balance sheet witnessed significant improvement in quality and liquidity. Furthermore, the Shareholders' equity increased by 2.7% during the same period.

The US$ 100 million Sukuk for The Building Materials Company has been successfully arranged and paid for in full on its Maturity date 18 October, 2011. Kuwait Finance House, Liquidity Management Centre, Gulf International Bank and Standard Bank underwrote the sukuk.
The Sukuk was supported by building material factories which supplied an over-collateralization and an added security for all Sukuk holders. It offered a semi-annual return of 100 basis points over US Dollar 6 months LIBOR.

The $100 million sukuk for the Building Materials Company has been successfully resolved and paid for in full on its maturity date on October 18.
The statement was given by the arrangers and lead managers, Kuwait Finance House (KFH), Liquidity Management Centre, Gulf International Bank, and Standard Bank.

The report pointed out that Kuwait ranked first among the GCC countries in terms Islamic banks assets to total banking assets, while Saudi Arabia and the UAE have risen among the countries that promote Islamic finance products and services. It added that there are many opportunities still available for Islamic finance solutions in the region where real estate finance tops other areas of interest prevalent in the UAE and Saudi Arabia.
The existence of financial centers in Bahrain, Qatar and the UAE, as well as a number of Islamic finance organizations such as the Accounting and Auditing Organization for Islamic Financial Institutions, Liquidity Management Centre, and the International Islamic Financial Market will continue to attract new players to the region and further propel the Islamic banking industry to greater heights.