IslamicFinance.de

Nigeria plans to license at least two Islamic financial institutions by the end of the year and is getting assistance from Malaysia to expand its sharia-compliant industry, in a nation where 70 percent of people have no access to regular banking services.
Central Bank of Nigeria governor Lamido Sanusi said this month that as many as three non-Islamic banks had expressed interest in opening sharia-compliant “windows”.

African Trade Insurance Agency (ATI) has partnered with Islamic Corporation for Insurance of Investments and Export Credit (ICIEC) to help traders cushion against political risks in North Africa.
The pact, with the Saudi Arabia-headquartered insurer, is expected to help traders doing business in the Muslim-dominated Northern Africa amidst ongoing political turmoil in the region.
Political upheaval that has seen governments in Tunisia and Egypt toppled and others like Libya and Yemen facing uprising has prompted reassessment of the region’s risk profile.
The political unrests that have also engulfed Bahrain have as well sent debt protection costs and yields on government debt up across the Gulf, the world’s top oil exporting region.

EIGHTH INTERNATIONAL CONFERENCE ON ISLAMIC ECONOMICS AND FINANCE

SUSTAINABLE GROWTH AND INCLUSIVE ECONOMIC DEVELOPMENT FROM AN ISLAMIC PERSPECTIVE

Doha, Qatar - December 25-27, 2011

CALL FOR PAPERS

The global economy continues to face the perennial problems of poverty, persistent youth unemployment, excessive inequalities of income and wealth, high levels of inflation, large macroeconomic and budgetary imbalances, exorbitant debt-servicing burdens, inadequate and aging public utilities and infrastructure, skyrocketing energy prices, and growing food insecurity. The reoccurring regional and global financial crises further intensify and magnify these problems particularly for the underprivileged segments of the world population. As a result, many countries are at the risk of failing to achieve the Millennium Development Goals (MDGs) set by the United Nations. However, some countries also present optimistic experiences to share, and from which useful lessons can be drawn for shaping the future economic scene in other countries.

Kazakhstan will revive plans this year for a $500 million debut sukuk issue that could create a benchmark for corporate lenders. The aim is to develop an Islamic finance sector in Central Asia’s top economy.

The International Finance Corp (IFC) has said that development institutions plan to come to the aid of banks in the Middle East and North Africa that face credit strains due to turmoil in the region.

Kazakhstan plans to attract up to $10 billion in Islamic finance over the next five to seven years, Arken Arystanov, chairman of the regulatory agency at the Regional Financial Centre of Almaty (RFCA) stated.

The Securities and Exchange Organization of Iran has put on agenda to add new Islamic instruments such as Derivative Securities, Istisna and Murabaha in Capital Market as of the next Iranian calendar year (March 21, 2010).
Ali Saeedi, a senior official in Bourse Organization said the necessary grounds have been paved for the entrance of sukuk or Islamic bonds in Bourse Organization, adding BRokerage firms are considered as the main infrastructures for entrance of new monetary means to bourse. He gave news that Murabaha bonds would be issued next year.

Participants of the three-day meeting of the first West African Islamic Investment Forum have sought for a comprehensive investment map for Africa to be designed and a West African Islamic fund be established.
The participants also called on the forum and other stakeholders to initiate sponsorship for continued research, publication and capacity building on how to explore and harness investment opportunities in West Africa.

Al Baraka Pakistan Limited (ABPL) will enter the mutual fund industry by June this year and funds will be established in collaboration with a well-established fund manager.
ABPL President Shafqaat Ahmed highlighted that the growth of Islamic income funds has outpaced the growth of the overall mutual fund industry in recent months.

The International Islamic Liquidity Management Corporation (IILM) is expected to issue the first Shariah-compliant financial instruments by year-end.
The minimum size of the instruments could be US$300 million depending on the market demand.
The IILM was established on October 2010 with 14 founding shareholders, comprising the 12 central banks of Indonesia, Iran, Kuwait, Luxembourg, Malaysia,Mauritius, Nigeria, Qatar, Saudi Arabia, Sudan, Turkey, and the United Arab Emirates (UAE), as well as two multi-lateral institutions, the Islamic Development Bank and the Islamic Corporation for the Development of the Private Sector.

Standard & Poor's commented today about the negative rating actions it has taken on several banks and insurance companies following sovereign rating actions in the Middle East and Africa since the unrest began: four banks in Tunisia, two banks in Egypt, two banks and one insurance company in Jordan, and four banks and three insurance companies in Bahrain.

Nigeria wants to establish itself as the African hub for Islamic banking and is working on a regulatory framework to try to emulate the success of the industry in Malaysia.
Nigeria is home to the largest Muslim population in sub-Saharan Africa, with around half of its 150 million people members of the Islamic faith. It is also home to one of Africa's fastest growing consumer and corporate banking sectors.

Iranian Deputy Oil Minister Mohsen Khojastehmehr says Tehran will issue Islamic bonds (Sukuk) for procuring financial resources for the country's oil projects.
Sukuk will be issued in the next Iranian calendar year which starts on March 21 as part of the ministry's plans to diversify financial resources for implementing various upstream and downstream projects in the oil industry.

Islamic bonds, led by securities in the Arabian Gulf, underperformed emerging-market debt in February as spreading unrest across the Middle East caused the biggest monthly rise in yields since May.
Investors are shunning Middle East assets as protests expanded to Oman, Bahrain, Yemen and Libya, holder of the largest proven oil reserves in Africa. Moody’s Investors Service and Abu Dhabi Commercial Bank say Islamic bonds aren’t likely to recover unless demonstrations that have toppled Tunisia’s and Egypt’s rulers and killed hundreds end soon.

Political unrest and the resulting economic impact in some countries of the Middle East and North Africa (MENA) are proving detrimental to sovereign credit quality in the region. This is written in the following two reports of Standard & Poor's Ratings Services: "Credit FAQ: Middle East Unrest's Credit Impact: How We Assess The Political And Economic Risks In Sovereign Ratings," and "Report Card: Middle East And North Africa Sovereign Ratings Dip As Political And Fiscal Risks Intensify."
Almost all sovereigns in the region, including wealthy oil-exporting countries, share, to varying degrees, some or many of the political and economic risks that we believe underlie the unrest.

Max Linnington is head of Bloomberg for the Middle East and North Africa and South Asia. He makes a statement about the launch of the company’s new Islamic finance platform.
Bloomberg’s platform is trying to give customers the tools that they need to make the very best investment decisions when it comes to investing in a Sharia-compliant way. Because this community is a little bit disparate, Bloomberg also try to connect the community together.

Saudi King Abdullah’s pledge to increase spending on housing by 55 billion riyals ($15 billion) probably will do little to relieve the country’s home shortage unless it’s coupled with long-delayed changes in mortgage financing laws.
The kingdom’s 86-year-old monarch last week announced plans to spend about 110 billion riyals on programs aimed at boosting housing, education and social welfare. Governments from Jordan to Yemen have offered concessions to quell public discontent after popular uprisings toppled leaders in Tunisia and Egypt last month and sparked protests across the Middle East and North Africa.

The State Bank of Pakistan (SBP) Tuesday accepted bids worth Rs 47.539 billion for 3-year government of Pakistan Ijara Sukuk against the bids offered worth Rs 56.839 billion.
The SBP further announced that the cut-margin will be applicable to all accepted bids and the benchmark is 6-month Market Treasury Bill (MTB) auction weighted average yield.

Hajara Adeola is the CEO of Lotus Capital Limited, an ethical investment firm specialising in Shari’ah compliant asset management. She speaks on the challenges of Islamic finance practices in Nigeria and why the country should be part of the huge global Islamic finance market.
"I can use money, but I can't eat it. But I can buy rice at a cost and trade it at a premium and make my profit. Or I can build a house, and I can rent or lease it out. The fact that I have N7,000 for a bag of rice, I should not earn money just for having it in cash, as you do in the bank which is what interest is. You get a rate on money and that is what is forbidden in Islam." This is one of her many points of view.

Niche Islamic investment banks in the Middle East and North Africa (Mena) may go in for mergers and acquisitions with conventional lenders to achieve the critical mass for reaping economies of scale.
It is anticipated first the build up of national champions driven by major shareholders, as was the case with Emirates NBD in conventional banking. Nice Islamic bank, such as Islamic investment banks (which have been particularly affected by the financial crisis) may diversify through M&As with banks that complement their businesses.