Saudi Arabian

Islamic finance and SRI share a lot of common ground

Socially responsible investment (SRI) and Islamic finance share significant common ground. Both spheres of investment demand the businesses chosen for investment are socially useful, not detrimental to humanity, and compliant with humanitarian ethics. SEDCO Capital has incorporated the Sharia-compliant investment approach with its responsible investment strategy and created the concept of prudent ethical investing (PEI). At the heart of PEI lie the environmental, social and governance criteria (ESG) that are integrated into financial analyses. SEDCO Capital is not only Sharia-compliant but also evaluates ESG aspects as part of its investment process. PEI is merging these two forces to embrace a more sustainable economic development model that is expected to attract non-Muslim SRI investors into the Islamic finance market.

Saudi shares fall on bank loan provisions

Saudi Arabian shares fell for a fourth day after banks in the kingdom reported lower third- quarter profit on provisions for bad loans.
Saudi banks have been hurt since the onset of the global credit crisis as provisions for bad loans rose and lending slowed after the Saad and Algosaibi business groups defaulted on at least US$15.7 billion of loans. Saudi British Bank, the lender 40% owned by HSBC Holdings Plc, Al-Rajhi Bank, Saudi Arabia’s biggest by market value, and Arab National Bank were among 10 out of the 11 banks in the nation that reported a decline in third-quarter profit last week.
The country’s banks will be required to make 100% provisions against non-performing loans, central bank Governor Muhammad al-Jasser said in an interview shown on Dubai-based Al Arabiya television on October 12.

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