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Islamic Finance Briefing - Category | Finance more

QFC’s Islamic finance tax regime ‘friendliest in Mena’

Posted on 14 February 2013 by Laxman  |  Email|Print

The Qatar Financial Centre (QFC) has the most Islamic finance friendly tax systems, out of the eight jurisdictions in the Middle East and North Africa (Mena) region, according to a study.
“While simpler Islamic finance transactions can be carried out in some countries without prohibitive tax costs, of the countries reviewed only Turkey and the QFC have a tax system that enables sukuk transactions to be carried out without excessive tax costs,” said the study, conducted by three leading experts Mohamed Amin, Salah Gueydi and Hafiz Choudhury, said………………………………………..Full Article: Source

Do we need better Islamic finance oversight?

Posted on 14 February 2013 by Laxman  |  Email|Print

The statement by the Capital Market Authority (CMA) appeared to be in response to concern about uneven self-regulation by the institutions.
Islamic financial institutions in Kuwait should hire enough personnel to ensure they comply with sharia standards, and work with the personnel in a transparent way, the country’s market watchdog said on Tuesday. The statement by the Capital Market Authority (CMA) appeared to be in response to concern about uneven self-regulation by the institutions………………………………………..Full Article: Source

Bangladesh govt to get $2.2bln IDB loans for fuel import

Posted on 14 February 2013 by Laxman  |  Email|Print

The government will take $2.2 billion loans this year from Islamic Development Bank at a lower interest rate to finance the increasing imports of fuel. Of the amount, the new loan is $1.345 billion with an interest rate of 4.65 percent, while $855 million is a rollover loan with 5 percent interest. The loans will have to be paid back in nine months.
The decision to take the loans was approved last week at a meeting of the hard-term loan committee of the government, with Finance Minister AMA Muhith in the chair………………………………………..Full Article: Source

Kuwait watchdog urges better Islamic finance oversight

Posted on 13 February 2013 by Laxman  |  Email|Print

Islamic financial institutions in Kuwait should hire enough personnel to ensure they comply with sharia standards, and work with the personnel in a transparent way, the country’s market watchdog said on Tuesday.
The statement by the Capital Market Authority (CMA) appeared to be in response to concern about uneven self-regulation by the institutions………………………………………..Full Article: Source

Clear direction helping Dubai to form ambitious Islamic finance hub

Posted on 13 February 2013 by Laxman  |  Email|Print

Dubai’s aim to become the economic hub of the Islamic world is so ambitious that, to achieve it, the grand strategy will have to be split into manageable parts for implementation.
Plans for one vital part - the reclaiming of the sukuk industry as an Arabian Gulf-centred business - are well under way, but are about to get a boost from a proposal prepared by Nasdaq Dubai and circulated among that exchange’s member firms………………………………………..Full Article: Source

Malaysia: New Law requires Islamic financial institutions to be Shariah-compliant

Posted on 13 February 2013 by Laxman  |  Email|Print

It had been reported that The new Islamic Financial Services Act 2012 (IFSA) will statutorily enforce management of Shariah-non-compliance risk and requires Islamic financial institutions to ensure at all times that their aim, operation, business, affairs and activities are in compliance with Shariah.
“This is perhaps one of the distinctive features of the IFSA 2012,” said Prof Datuk Dr Rifaat Ahmed Abdel Karim, Chief Executive Officer of International Islamic Banking Liquidity Management Corporation in a note. The Act, which is pending the Royal Assent, requires that any failure to abide by this statutory requirement has to be immediately notified to the regulator and the Shariah committee of the financial institution………………………………………..Full Article: Source

Islamic venture capital: Crowd funding

Posted on 13 February 2013 by Laxman  |  Email|Print

Is crowd funding the VC for the masses, finally? Crowd funding enables — through a collective cooperation of a network of investors — pooling capital and other resources to seed initiatives, startups, expansions, etc.
Banks in the Muslim world do not lend without collateral, as an idea or early stage development company is too risky, too small to fund or the business model does not fit the financing criteria. Thus, venture capital does not exist in OIC in a meaningful manner. Furthermore, how many stories from the Muslim world about investing in the “next big thing” in Silicon Valley VC funds?……………………………………….Full Article: Source

AJF signs QR346mln murabaha deal with GCC banks syndicate

Posted on 12 February 2013 by Laxman  |  Email|Print

In its first ever syndicated financing transaction, the Doha-based consumer finance company Al Jazeera Finance (AJF) has signed a QR346mn three-year dual currency murabaha facility with a syndicate of banks from the GCC (Gulf Co-operation Council) region.
QInvest acted as sole bookrunner and structuring advisor to Al Jazeera Finance . Qatar Islamic Bank took the mandated lead arranger role and was also acting as the investment agent. Ahli United Bank, First Gulf Bank UAE and QInvest were the lead arrangers………………………………………..Full Article: Source

Dubai’s bid to cut rate on $800 mln loan said to be rejected

Posted on 12 February 2013 by Laxman  |  Email|Print

Dubai’s government last month sold $750 million of 10-year Islamic bonds at a price to yield 3.875 percent, compared with 6.45 percent for similar-maturity notes in April. The cost to protect Dubai debt using five-year credit default swap prices tumbled 220 basis points to 225 last year after the emirate partly repaid and refinanced $3.75 billion of debt at state- owned companies and as the city’s tourism, retail, trade and transport industries rebounded.
The loan included both conventional and Islamic portions and was aimed at funding transport projects. There’s demand for good quality assets and the securitization of Dubai’s road-toll receipts, known as salik, is now a proven structure and should generate good demand if it’s refinanced, the banker said………………………………………..Full Article: Source

Pakistan: Campaign for promotion of Islamic finance

Posted on 12 February 2013 by Laxman  |  Email|Print

The Deputy Governor, State Bank of Pakistan (SBP), Kazi Abdul Muktadir has said that a comprehensive media campaign for promoting inherent strengths of Islamic finance and clearing common apprehensions, confusions and misconceptions about Islamic banking and finance is being launched shortly. ‘This campaign is to be led by the Islamic banking industry with the support of SBP’, he added.
In his opening remarks while chairing a meeting for initiating the media awareness campaign to promote Islamic banking in Pakistan at SBP, Karachi today, he said that preliminary findings of SBP comprehensive country-wide survey on “Knowledge, Attitude & Practices of Islamic Banking in Pakistan” suggest the dire need for initiating mass awareness campaign to increase public trust and confidence in Islamic banking………………………………………..Full Article: Source

Finance House profit jumps 20.4pct

Posted on 12 February 2013 by Laxman  |  Email|Print

Abu Dhabi-based Finance House Group net profit for 2012 rose 20.4 per cent to Dh72.2 million compared to Dh60 million. Total assets grew to Dh3.72 billion, registering a steady increase of six per cent over Dh3.51 billion as at December 31, 2011. The board has recommended a cash dividend of 20 per cent, subject to regulatory approvals.
Mohammed Abdulla Alqubaisi, Chairman of Finance House, said: “Despite challenging market conditions and a tighter regulatory framework, we are proud to maintain our profitable stance for the eighth successive year since inception. For a genuine private sector enterprise operating in the fiercely competitive UAE financial services sector, this is a creditable achievement indeed”………………………………………..Full Article: Source

UAE ‘has what it takes’ to be Islamic finance hub

Posted on 11 February 2013 by Laxman  |  Email|Print

The UAE has what it takes to become a hub for Islamic finance, according to Sheikh Mohammed bin Rashid Al Maktoum, the country’s vice president and prime minister. Sheikh Mohammed, also ruler of Dubai, made his comments at a workshop organised by the higher committee for development of Islamic economy sector to follow up progress on action plans and proposed initiatives.
He said in comments published by news agency WAM: “We have a clear vision for this vital sector and we want it to contribute significantly to our national economy and ton help bolster our position as the world’s capital for Islamic economy.”……………………………………….Full Article: Source

Bank Nizwa unveils Islamic auto finance in Oman

Posted on 11 February 2013 by Laxman  |  Email|Print

Bank Nizwa, Oman’s first fully Shari’ah-compliant bank, launched its Islamic auto finance product on 9 February. The auto finance is a Murabaha-based contract.
In a statement from the bank, Tariq al Farsi, general manager, retail and private banking, Bank Nizwa said, “Our customers are showing interest in our Shari’ah-compliant products and services. Our auto-finance product offers customers the opportunity to choose a car to suit their lifestyles, and we at Bank Nizwa endeavour to exceed their expectations.”……………………………………….Full Article: Source

Dana sells half of its stake at Hungarian oil and gas firm MOL

Posted on 11 February 2013 by Laxman  |  Email|Print

Dana Gas raised US$135 million from the sale of about half its stake in MOL, a Hungarian oil and gas firm, the company said Sunday. Dana sold 1.675m shares in MOL, one of Dana’s partners in a gas project in Iraq’s Kurdistan region, on Friday.
The sukuk restructuring, which involves a $70m cash repayment and a pair of new sukuks covering the remaining $850m, is expected to be completed in the first half of the year. The proceeds from the MOL share sale will be used to meet short-term obligations, including Dana’s sukuk restructuring obligations, the company said………………………………………..Full Article: Source

QInvest arranges US$95mln Murabaha facility for Al Jazeera Finance

Posted on 11 February 2013 by Laxman  |  Email|Print

Al Jazeera Finance (AJF) has signed a US$ 95 million (QR 345.8 million) 3-year dual currency Murabaha facility with a syndicate of banks from the GCC, the company said Sunday.
QInvest acted as Sole Bookrunner and Structuring Advisor to AJF in its first syndicated financing transaction. Qatar Islamic Bank took the Mandate Lead Arranger (MLA) role and is also acting as the Investment Agent. Ahli United Bank, First Gulf Bank UAE and QInvest were the Lead Arrangers………………………………………..Full Article: Source

Islamic finance a boost for USAID’s Afghan farm fund

Posted on 08 February 2013 by Laxman  |  Email|Print

Economic instability and legal obstacles have slowed the introduction of modern forms of Islamic finance in Afghanistan. But sharia-compliant loans are beginning to play a role in the farm sector through a U.S.-funded aid programme.
The Afghan government is using Islamic financial contracts to extend credit to farmers in areas where conventional banking has not fully satisfied demand for funds. The Agricultural Development Fund (ADF), set up in 2010 through a $100 million grant from the U.S. Agency for International Development (USAID), offers both conventional credit and Islamic financing………………………………………..Full Article: Source

Bank of Khartoum eyes more Gulf farming finance after first rating

Posted on 08 February 2013 by Laxman  |  Email|Print

Bank of Khartoum, Sudan’s oldest bank, wants to boost its agricultural finance business with the help of Gulf Arab banks after winning the African country’s first-ever international rating, its head said on Thursday.
Undeterred by decades of wars, poverty and spiralling inflation, the bank has been steadily expanding its retail and corporate business in the vast country. Its main shareholders, Dubai Islamic Bank, Sharjah Islamic Bank and Abu Dhabi Islamic Bank, are currently more than tripling the capital to 1 billion Sudanese pounds (around $225 million based on the official rate)………………………………………..Full Article: Source

Over 70 pct of Belgium Muslims interested in Islamic finance

Posted on 07 February 2013 by Laxman  |  Email|Print

Over 70 per cent of Belgian Muslims express strong interest in Islamic finance, revealed Belgium’s first independent market study. Key findings published this week from Belgium’s first independent market study, Islamic finance in Belgium – sizing the retail market points to a very strong interest from local Muslim consumers in Islamic finance products and services.
Over 70 per cent of survey respondents interviewed for the study have indicated their likelihood to take up such services if local banks were to begin offering them………………………………………..Full Article: Source

Location, rules may aid Dubai’s Islamic finance push

Posted on 07 February 2013 by Laxman  |  Email|Print

Dubai’s strengths as a vibrant trading economy could help its push into Islamic finance, which has been plagued by doctrinal disputes and uncertainty over regulation.
If Dubai has its way, the world’s biggest Islamic bond issues will be designed under its rules and traded in its market. Muslims around the world will use Dubai’s standards to prepare food, and take disputes to Dubai for Islamic arbitration………………………………………..Full Article: Source

IFSA to enforce syariah terms in Islamic finance

Posted on 07 February 2013 by Laxman  |  Email|Print

The soon-to-be-introduced Islamic Financial Service Act 2012 (IFSA 2012) will make Malaysia one of the few countries in the world where the Islamic regulator is given a mandate to promote syariah compliance among Islamic financial institutions, said a former senior official of Bank Negara Malaysia (BNM).
“The act will ensure there would be greater certainty and will ensure that the syariah terms can be enforced as per the terms of the syariah contract,” said former BNM assistant governor Gopal Sundaram at a forum discussing the advent of the new legislation………………………………………..Full Article: Source

Islamic finance model global demand

Posted on 06 February 2013 by Laxman  |  Email|Print

It had been reported that The Islamic financial system has grown tremendously over the last 40 years, says Dr Hatim El Tahir, Director, Islamic Finance Group, for Deloitte and Touche.
“The total size of the Islamic insurance industry is US$1.3 trillion which is still small compared to the international financial market. In 1973 it was only US1$ billion,” he said on Thursday night during his contribution to a seminar on Islamic Banking hosted by the Agricultural Development Bank (ADB) at the National Academy Performing Arts (NAPA) in Port-of-Spain………………………………………..Full Article: Source

Australian firms eye Islamic funding from GCC

Posted on 06 February 2013 by Laxman  |  Email|Print

Australian businesses and fund managers will find accessing capital from countries within the Gulf Cooperation Council (GCC) easier with the establishment of global Islamic finance experts Amanie Advisors in Australia.
With enormous multi-billion dollar pools of capital forming from within the GCC’s combined economies of Saudi Arabia, Kuwait, Bahrain, Qatar, Oman and the UAE, there is expected activity of approximately $1.5 trillion in 2013, this representing a huge opportunity for Australian businesses and fund managers to grow………………………………………..Full Article: Source

PNB backs government’s efforts at promoting Islamic finance

Posted on 06 February 2013 by Laxman  |  Email|Print

Permodalan Nasional Bhd (PNB) is a strong supporter of the government’s efforts at promoting Islamic finance with investee companies under the group being major players in the industry.
President/Group Chief Executive Tan Sri Hamad Kama Piah Che Othman said the investee companies currently command a market share of over 30 per cent in Islamic banking and more than 80 per cent for the takaful business.Speaking at the Yayasan Tun Ismail Memorial Lecture Series 2012/2013 here Tuesday, he said the group’s major strategic investee company, namely Maybank, had total assets worth RM476.9 billion as of Sept 30, 2012………………………………………..Full Article: Source

Bank Sarasin takes Avaloq for Islamic finance

Posted on 05 February 2013 by Laxman  |  Email|Print

Bank Sarasin & Co has selected Avaloq’s Islamic Banking Solution, in an effort to upgrade its range of Sharia-compliant offerings to private clients.
The new system covers a range of Islamic products, such as murabaha finance and placement, diminishing musharaka, and others. Murabaha refers to a form of fixed-income commodities trading, where parties agree on an upfront price pre-sale, and the seller takes physical receipt of the commodity before passing it on……………………………………Full Article: Source

ASM Investment aims to be shariah-compliant by year-end

Posted on 05 February 2013 by Laxman  |  Email|Print

ASM Investment Services Bhd, which aims to be a full-pledged syariah-compliant fund management company by the end of this year, will convert the remaining three unit trust funds into shariah-compliant assets, said its CEO Ameer Ali Mohamed.
ASM Investment, a subsidiary of Pelaburan MARA Bhd, manages 14 unit trust funds, of which 11 are already syariah-compliant. “We are changing all conventional funds into syariah-compliant funds in line with the our inspiration to make ASM Investment a syariah-compliant fund management company by year-end,” Ameer told reporters after the launch of four converted syariah-compliant funds……………………………………Full Article: Source

The basics of Islamic finance

Posted on 05 February 2013 by Laxman  |  Email|Print

Islamic finance is a system of financial services that complies with the principles of Shari’a (Islamic law). Islamic finance is free from the elements of Riba (interest), Gharar (extreme uncertainty and lack of transparency), Qimar (gambling) and some other market malpractices which are prohibited by Shari’a.
Islamic finance transactions are typically asset backed as charging of returns on lending money is prohibited. Islamic finance is based on the principle of assuming risk / liability in order to obtain rewards……………………………………Full Article: Source

SHUAA launches Islamic lease financing for Saudi SMEs

Posted on 04 February 2013 by Laxman  |  Email|Print

Gulf Installments Company has been established to provide Shari’ah-compliant installment and lease financing with a focus on small and medium sized enterprises. Saudi Arabian small and medium sized enterprises (SMEs) account for 90 per cent of all Saudi businesses but receive only two per cent of bank lending
In Saudi Arabia, Gulf Installments Company aims to replicate the financial success of SHUAA’s UAE SME financing subsidiary, Gulf Finance Company…………………………………..Full Article: Source

QIB signs QR800mln Islamic financing deal with NBK Holding

Posted on 04 February 2013 by Laxman  |  Email|Print

Qatar Islamic Bank (QIB) has signed a QR800mn financing deal with NBK Holding. The signing ceremony was held at NBK Holding’s headquarters and was attended by Sheikh Nawaf Nasser bin Khaled al-Thani, chairman and CEO of NBK Holding, and Ahmad Meshari, acting chief executive officer of QIB .
HE Sheikh Nawaf said: “The financing agreement with QIB will enable NBK to move forward with its ambitious expansion plans. NBK Holding’s subsidiaries have significantly contributed to the Qatari private sector and the company’s strategy is to continue its pioneering role in the economic growth of Qatar…………………………………..Full Article: Source

Islamic financing holds promises in Yemen

Posted on 04 February 2013 by Laxman  |  Email|Print

Economists in Yemen have for several years now encouraged the state to move away from its dependency on oil and gas revenues to explore other avenues which would generate national growth and sustain economic development.
Many foresee that the financial sector and more particularly, the Islamic finance sector would prove a fructuous venture for a country such as Yemen where tradition and Islamic values are more prominent. Nathan Giliano, a professor of Economics in Vancouver, Canada explained that over the past few years - since the world economy so famously land-slided on Wall Street slope - Islamic financial products had grown in popularity across the Arab world and its emerging economies…………………………………..Full Article: Source

Islamic finance model growing globally

Posted on 04 February 2013 by Laxman  |  Email|Print

The Islamic financial system has grown tremendously over the last 40 years, says Dr Hatim El Tahir, Director, Islamic Finance Group, for Deloitte and Touche. “The total size of the Islamic insurance industry is US$1.3 trillion which is still small compared to the international financial market. In 1973 it was only US1$ billion,” he said on Thursday night during his contribution to a seminar on Islamic Banking hosted by the Agricultural Development Bank (ADB) at the National Academy Performing Arts (NAPA) in Port-of-Spain.
The seminar was attended by members of the local Muslim community as well as other stakeholders including PSA president Watson Duke…………………………………..Full Article: Source

Still springtime in North Africa? Interest in Islamic finance is rising

Posted on 04 February 2013 by Laxman  |  Email|Print

It may still be ‘too early’ to gauge the full impact of the events that led to regime change across much of the Arab world and are still being played out in Syria and elsewhere. It is, however, clear that one beneficiary is the Islamic finance sector. Unmet economic need was one of the key triggers for the protests. New governments in Tunisia, Libya and Egypt are now moving to embed Shari’ah-compliant finance into their economic systems.
For example, on 29 September 2012, plans were revealed in Tunisia to issue Sukuk early this year. Reuters reported Chadli Avari, Governor of the Banque Centrale de Tunisie, as saying “Tunisia will begin issuing Islamic bonds early next year … This is part of the draft budget for 2013.”………………………………….Full Article: Source

India: Give Islamic finance a chance

Posted on 01 February 2013 by Laxman  |  Email|Print

While India’s current legal framework on lending is interest-based, Islamic finance is founded on participatory finance that entails sharing of profit or loss. If the profit earned is less than expected cash flows, then a smaller profit pool is shared — a mechanism that can lower the cost of capital. The RBI governor recently said that laws have to be amended before one goes about allowing such products.
Advocates of Islamic finance think it’s no big deal and one need not go through the rigmarole of standing committees and parliamentary proceedings — if the central bank can use its powers to let commercial banks open a new window. Other countries, even a few not particularly sensitive to Islamic sensibilities, have gone ahead with it. That’s because they sensed that any leading financial centre should be open to various investment possibilities………………………………………..Full Article: Source

Oman rules may spur Islamic finance reforms

Posted on 01 February 2013 by Laxman  |  Email|Print

Oman’s new Islamic banking rules could encourage the development of a larger pool of Shariah scholars and ultimately help to raise operating standards for them around the world, according to bankers and scholars.
Last month, the sultanate’s central bank released an extensive Islamic banking rulebook which included provisions for Shariah scholars, such as fit-and-proper criteria and term limits on scholars’ appointment to Shariah boards, which decide whether products and activities obey Islamic principles………………………………………..Full Article: Source

Shariah adviser to Goldman Sachs’ Sukuk shuts down

Posted on 01 February 2013 by Laxman  |  Email|Print

High profile Shari’ah advisory Dar Al Istithmar, which advised Goldman Sachs on its ill-fated $2 billion Sukuk programme, has closed down with most of its staff joining another firm. Most of Dar Al Istithmar’s staff have moved to Khalij Islamic, an Islamic investment boutique with offices in London and Dubai, reported Reuters.
A rift was said to develop last year between staff and shareholders. “Dar actually stopped conducting advisory business in June,” EuroWeek quotes one source as saying. “There was a difference of opinion on the future direction of the firm between shareholders and management.”……………………………………….Full Article: Source

Saudi Kingdom Holding forms Sharia board

Posted on 01 February 2013 by Laxman  |  Email|Print

Kingdom Holding Co, the international investment firm of Saudi billionaire Prince Alwaleed bin Talal, has formed a syariah board of prominent scholars in order to raise more of its funding through Islamic finance.
The decision by one of the most prominent investment firms from the Gulf is likely to be seen as a boost to the Islamic finance industry, which obeys religious principles such as bans on interest payments and pure monetary speculation. “The syariah committee was established to study the gradual conversion of future sources for loans for the company to be sharia-compliant,” Kingdom said in a brief statement………………………………………..Full Article: Source

Oman rules may spur reform of Islamic finance scholars

Posted on 31 January 2013 by Laxman  |  Email|Print

Oman’s new Islamic banking rules could encourage the development of a larger pool of sharia scholars and ultimately help to raise operating standards for them around the world, according to bankers and scholars.
Last month, the sultanate’s central bank released an extensive Islamic banking rulebook which included provisions for sharia scholars, such as fit-and-proper criteria and term limits on scholars’ appointment to sharia boards, which decide whether products and activities obey Islamic principles………………………………………..Full Article: Source

Kingdom Holding in Islamic financing push

Posted on 31 January 2013 by Laxman  |  Email|Print

Kingdom Holding, the international investment firm of Saudi billionaire Prince Alwaleed bin Talal, has formed a sharia board of prominent scholars in order to raise more of its funding through Islamic finance.
The decision by one of the most prominent investment firms from the Gulf is likely to be seen as a boost to the Islamic finance industry, which obeys religious principles such as bans on interest payments and pure monetary speculation………………………………………..Full Article: Source

High-profile Islamic finance firm Dar Al Istithmar closes

Posted on 30 January 2013 by Laxman  |  Email|Print

One of the most high-profile advisory firms in Islamic finance, Dar Al Istithmar, which advised Goldman Sachs on a controversial $2 billion sukuk programme, has closed down with most of its staff moving to another company, sources told Reuters.
Dar, which had offices in London and Dubai, was set up in 2004 as a joint venture between Deutsche Bank, which subsequently pulled out, and financial firms Russell Wood Ltd and Oxford Islamic Finance Ltd………………………………………..Full Article: Source

Kingdom sees future in Islamic loans as Alwaleed builds tower

Posted on 30 January 2013 by Laxman  |  Email|Print

Kingdom Holding Co. (KINGDOM), controlled by billionaire Prince Alwaleed bin Talal, established a committee to help the company move toward Shariah-compliant loans as Islamic financing gains appeal among borrowers.
The committee will “prepare an integrated strategic plan for the conversion of future loans in accordance with the Islamic Shariah,” the Riyadh-based company said in an e-mailed statement today. The panel will comprise Sheikh Abdullah Sulaiman Al Manee’a, an adviser to the Royal Court, Sheikh Mohamed Ali Elgari, Sheikh Ali Abdulaziz AlNashwan and Abdulah Salim AlGhamdi………………………………………..Full Article: Source

Japanese get into Islamic financing

Posted on 29 January 2013 by Laxman  |  Email|Print

The rise of Asian ship finance gets ever more sophisticated in its offerings. Bank of Tokyo-Mitsubishi UFJ and Sumitomo Mitsui Banking have organized a syndicated loan of $184m for Brunei Gas Carriers (BGC). The loan complies with Sharia law, which prohibits the charging of interest. The loan is being paid to a special-purpose company that will buy LNG ships and lease them to BGC. Instead of interest, the Japanese banks will receive charter fees.
This is the second loan the two banks have made to BGC following a $170m syndicated loan from a year ago. The Nikkei newspaper reports that Bank of Tokyo-Mitsubishi UFJ has set up a section specializing in Islamic financing at a local unit in Malaysia………………………………………..Full Article: Source

Dubai introduces Islamic categorisation for company registration

Posted on 29 January 2013 by Laxman  |  Email|Print

The Department of Economic Development in Dubai (DED) is developing the Islamic-compliant standard to classify or categorise the registered businesses in Dubai, Mohammad Al Shael, CEO of Business Registration & Licensing Sector at DED, said.
“The department is developing an official standard for Islamic-complaint companies as part of the required infrastructure to make Dubai the world’s Islamic-complaint economic capital.” Earlier this month, His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai, launched a new initiative that would make Dubai a global capital for the Islamic economy………………………………………..Full Article: Source

Islamic finance success offsetting global gloom

Posted on 29 January 2013 by Laxman  |  Email|Print

The private sector in the Kingdom has been spurred into action, giving a major boost particularly to real estate, construction, health care, education, financial services and a host of other activities, thus offsetting some of the global economic gloom, according to Khaled Al-Aboodi, CEO of the Islamic Corporation for the Development of the Private Sector (ICD), the private sector arm of the Islamic Development Bank (IDB) Group.
“However, financing for small and medium enterprises (SMEs) is not yet developed in most of the member-countries,” Al-Aboodi said………………………………………..Full Article: Source

Dubai’s Nakheel dismisses debt concerns as profits top Dh2bln

Posted on 29 January 2013 by Laxman  |  Email|Print

The Dubai property developer Nakheel dismissed concerns over its debt burden as it unveiled a Dh2.02 billion (US$549 million) profit for last year. The company, which restructured debt and received financial assistance from the Dubai Government following the property crash four years ago, said profits were 57 per cent higher than the previous year.
Revenues stood at Dh7.8bn, up 91 per cent on the previous year. The developer disclosed its financial results the day after Exotix, a boutique investment bank with offices in Dubai, cut its rating on Nakheel’s sukuk bonds to “sell”. It warned in an advisory note that the bond was no longer pricing in the risk of a default………………………………………..Full Article: Source

East outperforming West in Islamic finance

Posted on 28 January 2013 by Laxman  |  Email|Print

While lenders in the United States and Europe have downsized their exposure in banking in compliance with Islamic law, Islamic financial institutions in Southeast Asia and the Middle East and Africa (MEA) region are taking over the initiative.
According to global consultancy Ernst and Young, worldwide investments done in line with Islamic law, known as Shari’ah, will reach 1.8 trillion U.S. dollars globally in 2013. There was a time when major Western banks like Citigroup, HSBC, UBS and Deutsche Bank set the pace for the developments in Islamic finance, while their much smaller counterparts in the Muslim world just followed. In recent years, this order has been almost completely shifted in favor of the East………………………………………..Full Article: Source

Islamic finance success offsetting global gloom

Posted on 28 January 2013 by Laxman  |  Email|Print

The private sector in the Kingdom has been spurred into action, giving a major boost particularly to real estate, construction, health care, education, financial services and a host of other activities, thus offsetting some of the global economic gloom, according to Khaled Al-Aboodi, CEO of the Islamic Corporation for the Development of the Private Sector (ICD), the private sector arm of the Islamic Development Bank (IDB) Group
“However, financing for small and medium enterprises (SMEs) is not yet developed in most of the member-countries,” Al-Aboodi told Khalil Hanware of Arab News in an exclusive interview. “Even in GCC countries, there is lack of access to financing for SMEs,” Al-Aboodi pointed out………………………………………..Full Article: Source

Unsung heroes of Islamic finance industry

Posted on 28 January 2013 by Laxman  |  Email|Print

The beating heart of an Islamic bank is actually the treasury and its uniquely qualified people. Treasury, at one time, was about liquidity management, and now has become a profit centre for banks.
The challenge for Islamic finance treasury is there are not many options, vis-a-vis, conventional treasury on liquidity management, hence, their important contribution adds to not only the bottom line, but also the bonus!……………………………………….Full Article: Source

A good year for Islamic finance in Qatar

Posted on 28 January 2013 by Laxman  |  Email|Print

Qatar is ready to go to the top of the Big League of Islamic finance as her economy shifts up a notch in readiness to fulfil the promise of Qatar National Vision 2030. How far Qatar can continue to stay ahead of the curve in a global economy that is still struggling to come to grips with the worst ravages of the global financial crisis?
Several of the Gulf Cooperation Council’s member continue to enjoy economies that are buoyed by revenues from plentiful natural resources, Qatar included, but the International Monetary Fund in recent weeks has urged economies across the Middle East to introduce fiscal restraint and deeper reforms in order to be able to safeguard their future in the midst of a still precarious world economy………………………………………..Full Article: Source

How Islamic finance and a more ethical capitalism go hand-in-hand

Posted on 25 January 2013 by Laxman  |  Email|Print

The Qur’an’s teachings around business chime with the objectives of the worldwide social enterprise movement. Though wealth creation is the primary goal taught by top businessmen, social impact is considered to be a more fulfilling outcome for others.
Money is not timeless, but what you do with that money can be. The light you instil in the uneducated, the medicine you provide to the ill, or the food and water you provide to the malnourished is far more enduring than the car you drive or the house you buy. Most advocates of social entrepreneurship believe that creating a business with a social impact leaves much more than just a humble footprint behind………………………………………..Full Article: Source

Insolvency legislation and Islamic finance in the UAE

Posted on 25 January 2013 by Laxman  |  Email|Print

The compatibility of contemporary insolvency legislation in the context of Islamic financial institutions and Islamic capital markets instruments is an important subject which regulators, courts and other stakeholders must address sooner rather than later to ensure the sustainable and continuous growth of the industry.
This issue deserves more serious consideration from the legislatures and regulators as lack of an appropriate and legal and regulatory regime on insolvency in respect of Islamic financial institutions would certainly affect insolvency proceedings and the remedies sought or granted pursuant to such proceedings………………………………………..Full Article: Source

Sime Darby locks in cheap funding with sukuk offering

Posted on 25 January 2013 by Laxman  |  Email|Print

Malaysian conglomerate Sime Darby made a successful debut in the US dollar bond market, pricing on January 22 a dual-tranche sukuk issue totaling US$800 million. It is the first Malaysian issuer and the first sukuk issuer globally to launch in the international US dollar debt capital markets in 2013.
The transaction did not disappoint as it generated a robust investor demand as it offered a welcome diversification from the slew of conventional bond deals that are flooding the market since the start of the year………………………………………..Full Article: Source

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