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Islamic Finance Briefing - Archive | December, 2012

Politics, laws weigh on Islamic finance in India

Posted on 21 December 2012 by Laxman  |  Email|Print

India’s tiny Islamic finance industry is hoping to expand by developing products that would work around the country’s ban on sharia-compliant banking. But political and legal obstacles mean progress is likely to be slow.
An estimated 177 million Muslims in India, the largest Muslim minority population in the world, are unable to use Islamic banks because laws covering the sector require banking to be based on interest, which is forbidden in Islam………………………………………..Full Article: Source

Egypt’s cabinet approves draft law on Islamic bonds

Posted on 21 December 2012 by Laxman  |  Email|Print

Egypt’s cabinet on Wednesday approved a draft law on the issuance of Islamic bonds by the finance ministry and state-run administrative bodies, the State Information Service has reported.
The draft law will be referred to parliament before it officially passes into law. Islamic bonds are similar to ordinary government treasury bills and foreign currency denominated bonds but are in compliance with Islamic sharia law. New sectors, such as individual and investment funds, will now be able to lend money to the government through this financial tool (sukuk)………………………………………..Full Article: Source

First Aussie sukuk taps Labuan for RM489mln

Posted on 21 December 2012 by Laxman  |  Email|Print

Malaysia’s offshore tax haven of Labuan is opening the way for Australia’s first Islamic bonds, avoiding rules in the South Pacific nation that penalise sukuk. The SGI-Mitabu joint venture between The Solar Guys Distribution Pty and Mitabu Australia Pty will offer A$150mil (RM489mil) of notes in June to fund the construction of a solar power plant in Indonesia, M. Rusydi, a director at Mitabu, said.
The syariah board of scholars in Labuan, established as a global financial hub in 1990 and located off the coast of eastern Sabah state on Borneo island, is advising on the deal………………………………………..Full Article: Source

Dubai’s DEWA plans USD1bln Islamic bond issue in 2013

Posted on 21 December 2012 by Laxman  |  Email|Print

Dubai Electricity and Water Authority (DEWA) plans to issue as much as USD1 billion Islamic bond (sukuk) in the first quarter of 2013. CEO Saeed Al Tayer said that the utility’s move is part of a USD1.23 billion issuance plan to refinance existing debt and fund new investments.
The company has a USD872 million bond maturing in June 2013. DEWA completed a USD1 billion financing, with a tenor of 13 years, in May 2009 with agencies from France, Germany and Italy………………………………………..Full Article: Source

Morocco success bodes well for Arab Spring bonds

Posted on 21 December 2012 by Laxman  |  Email|Print

Morocco’s spectacular debut in the dollar-denominated bond market this month is good news for other countries that have been affected by the Arab Spring uprisings and may try to borrow money overseas next year.
Some of the debt may be in the form of sukuk, since all of the countries are laying the legal framework for issues of Islamic bonds. Morocco has not experienced revolutions like Egypt and Tunisia, but it faces similar political and economic pressures………………………………………..Full Article: Source

TTPC Islamic debt gets preliminary AA1 rating

Posted on 21 December 2012 by Laxman  |  Email|Print

Independent power producer Teknologi Tenaga Perlis Consortium Sdn Bhd’s (TTPC) proposed sukuk murabahah of up to RM835mil in nominal value (2012/2023) has been assigned a preliminary AA1 long-term rating with a stable outlook.
TTPC owns and operates a 650-MW combined-cycle, gas-turbine power plant in Kuala Sungai Baru, Perlis under a power purchase agreement (PPA) with Tenaga Nasional Bhd (TNB) in which the former would sell generating capacity and electrical energy to the latter for 21 years from March 31, 2003 to March 31, 2024………………………………………..Full Article: Source

BankIslami seeks 50pct profit jump in 2013 after doubling branches

Posted on 21 December 2012 by Laxman  |  Email|Print

BankIslami Pakistan Ltd. (BIPL), the nation’s second-biggest Islamic bank, is targeting a 50 percent profit increase next year as it doubles its branches to meet demand for Shariah-compliant services.
BankIslami will expand its network of outlets to about 200 in as many as 90 locations by the end of 2013, Chief Executive Officer Hasan Aziz Bilgrami said in an interview. The lender as of December last year operated 102 branches in 49 cities………………………………………..Full Article: Source

Oman adopts strict approach for Islamic banking

Posted on 21 December 2012 by Laxman  |  Email|Print

The sultanate last year became the last country in the GCC to introduce Islamic finance. Oman’s central bank took a strict approach to regulating Islamic banking in rules for the sector which it released on Wednesday, setting higher standards for the industry than many other countries.
The sultanate announced last year that it would introduce Islamic finance, becoming the last country in the six-nation Gulf Cooperation Council to do so. Business activity is expected to start early next year………………………………………..Full Article: Source

Agrobank on track to fully implement Islamic banking by 2015, says CEO

Posted on 21 December 2012 by Laxman  |  Email|Print

Agrobank is on track to fully implement Islamic banking by 2015, Chief Executive Datuk Wan Mohd Fadzmi Wan Othman said. He said Agrobank is formulating policies to ensure all its products and services are fully shariah-compliant.
“Most of our loans have already met syariah compliance requirements, but we still have loans under the conventional system and we are in the process of changing them into Islamic assets………………………………………..Full Article: Source

Bank Nizwa will open for public in Jan next year

Posted on 21 December 2012 by Laxman  |  Email|Print

Bank Nizwa will open for the public in January next year after obtaining final approval from the Central Bank of Oman to initiate Islamic banking services inside the Sultanate starting from December 23, said Dr Jameel al Jarudi, Executive Chairman of Bank Nizwa in a statement to Oman Arabic, sister daily of the Observer.
According to Al Jarudi, the Bank will offer its services to its staff and their families from next Sunday and in a matter of three weeks time we complete technical preparations after which the Bank will be able to conduct international money transactions………………………………………..Full Article: Source

Omani Takaful licences issued

Posted on 21 December 2012 by Laxman  |  Email|Print

Abdullah bin Salem bin Abdullah Al Salmi, Executive President of the Capital Market Authority (CMA) told reporters, “The draft law has been finalised. It will go to the cabinet and then to the Ministry of Legal Affairs and to Majlis A’Shura and Majlis Adawla. We hope that this process will not take long.”
Takaful insurance firms will be required to have minimum capital of OMR 10 million and be a separate entity, unlike a window operation in the banking sector………………………………………..Full Article: Source

Malaysia in “final stages” for Islamic finance legal framework

Posted on 20 December 2012 by Laxman  |  Email|Print

Malaysia is in the final stages of introducing a new legislation for Islamic banking and takaful products, the country’s central bank governor said on Wednesday, which gives a stronger legal basis to contracts devised by financial institutions.
Governor Zeti Akhtar Aziz did not give a time frame for launch of the legal framework. She said the legislation will help the Malaysian central bank better regulate and supervise the Islamic finance industry, which globally is valued at $1.3 trillion (800 billion pounds)………………………………………..Full Article: Source

Oman sets strict rules for Islamic banking

Posted on 20 December 2012 by Laxman  |  Email|Print

Oman’s central bank took a strict approach to regulating Islamic banking in rules for the sector which it released on Wednesday, setting higher standards for the industry than many other countries.
The sultanate announced last year that it would introduce Islamic finance, becoming the last country in the six-nation Gulf Cooperation Council to do so. Business activity is expected to start early next year………………………………………..Full Article: Source

Sukuk: Moment may have arrived for Islamic finance

Posted on 20 December 2012 by Laxman  |  Email|Print

Deliberately marginalised in Egypt for decades, Islamic finance is finally receiving attention, partly because of the changing political landscape and a new-found will to expand the sector.
Most recently, draft legislation for an Islamic bond, or sukuk, was finalised and presented to the prime minister as well as the president, Mohamed Morsi. There are also plans to introduce sovereign sukuk………………………………………..Full Article: Source

Dubai’s DEWA eyes $1bln sukuk in Q1 2013

Posted on 20 December 2012 by Laxman  |  Email|Print

Dubai Electricity and Water Authority (DEWA) is targeting a $1bn Islamic bond in the first quarter of next year. The emirate’s state-owned utility is planning the move as part of a AED4.5bn ($1.23bn) issuance plan for refinancing existing debt and new investments, Saeed Mohammad Al Tayer, managing director and CEO, said.
“The sukuk will be in the first quarter of next year… The majority of the amount will be sukuk, and the rest will be a mix to be issued in due time,” he was quoted as saying………………………………………..Full Article: Source

Malaysia Airlines in no rush to issue third tranche sukuk

Posted on 20 December 2012 by Laxman  |  Email|Print

Malaysia Airlines (MAS) is in no rush to issue the third tranche of its sukuk programme, says Chairman Tan Sri Md Nor Yusof. “We don’t need the funding for now,” he said during the visit of International Trade and Industry Minister Datuk Seri Mustapa Mohamed to MAS-GMR Aerospace Engineering Company Ltd’s maintenance, repair and overhaul facility in Hyderabad, India.
The recovery plans are in place already and going on well. “We will do it when the need arises,” he said when asked when MAS would issue its next sukuk………………………………………..Full Article: Source

Three Omani firms plan to float sukuks next year

Posted on 20 December 2012 by Laxman  |  Email|Print

At least three Omani companies, including Tilal Development Company (TDC), are planning to float Islamic debt instruments or sukuks next year. “We have given initial approvals for Tilal Development Company and an institution to float sukuks,” said Abdullah bin Salem bin Abdullah Al Salmi, Executive President of the Capital Market Authority (CMA).
He was talking to the media on the sidelines of an interactive session organised by the CMA. TDC earlier said that it is planning to float a RO50 million issue, which is seen by the end of January next year. Al Madina Financial and Investment Services is the lead arrangers of sukuk issue for TDC, which will use the proceeds of the issue for funding the expansion of its complex at Bausher………………………………………..Full Article: Source

Laws on takaful, sukuk soon

Posted on 20 December 2012 by Laxman  |  Email|Print

The draft law for Islamic insurance or takaful firms and amendments in Capital Market Law for accommodating Sharia compliant debt instrument or sukuk have been finalised. This will be enacted after it completes the routine regulatory approvals from different government entities, said Abdullah bin Salem bin Abdullah Al Salmi, Executive President of the Capital Market Authority (CMA).
“The draft law has been finalised. It will go to the cabinet and then to the Ministry of Legal Affairs and to Majlis A’Shura and Majlis Adawla. We hope that this process will not take long,” the CMA chief added………………………………………..Full Article: Source

Adventa Berhad makes early redemption of Islamic debt facility

Posted on 20 December 2012 by Laxman  |  Email|Print

RAM Ratings has received confirmation that Adventa Berhad (”Adventa”) has made an early redemption of the outstanding notes under its RM150 million Islamic Commercial Papers/Islamic Medium-Term Notes Programme (2011/2018) (”ICP/IMTN”).
The redemption had been effected through a sukuk swap exercise with Aspion Sdn Bhd’s (”Aspion”) RM150 million Islamic Commercial Papers/Islamic Medium-Term Notes Programme (2012/2018) (”debt instrument”). Aspion is a special-purpose company incorporated in July 2012, to take over the majority of Adventa’s assets and liabilities………………………………………..Full Article: Source

Cocoa to rice woos Kuwait to Asia’s $2 trillion: Islamic finance

Posted on 20 December 2012 by Laxman  |  Email|Print

Kuwait China Investment Co. (KCIC), part owned by the Persian Gulf nation’s sovereign-wealth fund, wants to tap what it says is Asia’s $2 trillion trade finance market with an Islamic fund to give commodity producers access to cash.
The fund, set up this month with Singapore-based EuroFin Asia Group, will help fill a gap left by European banks that scaled back their business in Asia, Managing Director Ahmad al- Hamad said in an interview. Producers and traders of agricultural and energy products in India, Singapore, Malaysia, Indonesia and Thailand can draw on the facility, he said………………………………………..Full Article: Source

Emaar obtains $500 mln financing facility for Turkey project

Posted on 20 December 2012 by Laxman  |  Email|Print

Emaar Properties PJSC (EMAAR), the developer of the world’s tallest tower in Dubai, obtained a $500 million loan from a group of banks to develop a mixed-use project in Turkey, its second such venture in the country.
Emaar raised $500 million in July from the sale of seven- year Islamic bonds at a profit rate of 6.4 percent, according to data compiled by Bloomberg. The bonds traded at a yield of 4.898 percent today, according to the data………………………………………..Full Article: Source

India: More investors eye entry into Shariah-based funds

Posted on 20 December 2012 by Laxman  |  Email|Print

Ajmal Ahammed is not a familiar name in the venture capital (VC) sector in India. Still, the VC entity where he’s operations head, while still in his late 20s, has launched its second fund in a short time.
What makes this fund different is its investors — they want to comply with Islamic law, as detailed in the Shariah. Secura India Real Estate Fund is India’s first ever shariah-compliant VC fund, owned by Kozhikode-based Secura Investment Managers………………………………………..Full Article: Source

Government welcomes Islamic super option: A first for Australia’s Muslim investors

Posted on 20 December 2012 by Laxman  |  Email|Print

The Australian federal government has welcomed news of the nation’s first superannuation option compliant with Islamic doctrine, launched by Sydney-based Crescent Wealth this week.
In a statement released on 17 December, federal minister for immigration and citizenship Chris Bowen said the launch will help to cement the international standing of Australia’s financial services industry. “The federal government is committed to promoting Australia as a major financial services hub in Asia, which is home to around two thirds of the world’s Muslim population,” Bowen said………………………………………..Full Article: Source

Ridge Islamic Capital: Operator puts faith in Shariah

Posted on 20 December 2012 by Laxman  |  Email|Print

After years of lagging behind other markets in the region, Islamic finance is gaining traction in Egypt. The latest addition to the scene is a company aiming to lure investors to the country’s capital market.
Ridge Islamic Capital is offering sharia-compliant investment banking, asset management and wealth management services………………………………………..Full Article: Source

Noor Takaful named Best Takaful Operator in Middle East

Posted on 20 December 2012 by Laxman  |  Email|Print

Noor Takaful, the Islamic insurance arm of Noor Investment Group, has been named the ‘Best Takaful Operator in the Middle East’, at the CPI Islamic Business and Finance Awards. The prestigious award was presented to Parvaiz Siddiq, Noor Takaful’s CEO by Saleh Al Akrabi, Chairman, CPI Financial at a gala ceremony held in Dubai. Noor Takaful has won the award for the third time in four years.
Dr. Ahmed Al Janahi, Managing Director, Noor Takaful, said: “We are honoured to have won this prestigious award once again. In selecting Noor Takaful for the award, industry peers have acknowledged the brand’s contemporary approach. We will continue to offer enhanced products and services to our customers to build on our success in the Takaful space.” (Press Release)

Indonesia: Islamic economy should be turbulence-proof: central bank`s governor

Posted on 20 December 2012 by Laxman  |  Email|Print

Governor of Bank Indonesia Darmin Nasution said that apart from being run by Sharia principles, the Islamic (Sharia) banking and finance system should be able to withstand turbulence and economic pressures.
“Islamic banking and finance should not only be based on Sharia principles and standards of Islamic banks, but must also withstand turbulence and economic pressure,” Darmin said here Wednesday………………………………………..Full Article: Source

Need to streamline Islamic finance industry urged

Posted on 20 December 2012 by Laxman  |  Email|Print

The rapid global growth in Islamic finance means that action must be taken to ensure that the way in which it is reported financially is harmonised and made more consistent, a report, based on a series of high level international roundtables, by KPMG and ACCA (the Association of Chartered Certified Accountants) has concluded.
The report calls on the International Accounting Standards Board (IASB) and the Islamic finance industry to work together to develop guidance and standards and educate the investor community on key issues………………………………………..Full Article: Source

Islamic insurance premiums to hit $12bln

Posted on 19 December 2012 by Laxman  |  Email|Print

The Islamic insurance industry has demonstrated substantial growth in recent years with gross written premiums (GWPs) estimated to reach $12 billion in 2012, said an expert. This growth will be coupled with a compound annual growth rate of up to 25 per cent, added Dr Metaib Al Rawqi, CEO of Saudi Arabia-based Weqaya Takaful Insurance and Reinsurance Company.
Al Rawqi was speaking ahead of the seventh International Takaful Summit (ITS) set to take place on February 18 and 19 at the InterContinental CityStars Cairo and expected to attract participation from over 25 countries………………………………………..Full Article: Source

Saudi Maaden raises $2.4bln from Islamic loan

Posted on 19 December 2012 by Laxman  |  Email|Print

Saudi Arabian Mining Co. (Ma’aden), which has an aluminum joint venture with Alcoa, raised SR9 billion ($2.4 billion) through an Islamic loan facility to help fund its future projects, it said in a statement Tuesday.
The murabaha-structured revolving credit facility has a life of five years and was increased from the SR7 billion initial target amount which the bank announced in June, Ma’aden said. A murabaha is a Shariah-compliant cost-plus-profit arrangement………………………………………..Full Article: Source

Why Shariah finance and real estate are a perfect match

Posted on 19 December 2012 by Laxman  |  Email|Print

Islamic finance continues to grow as a prudent alternative to conventional debt-based structures. Financial assets total more than US$1.3 trillion and instruments are expanding into new countries beyond its traditional markets in the Middle East and Malaysia.
At its core, Shariah principles favour the development and sharing of risk in physical assets, which contribute to the economic growth of society. There is therefore a natural match between the Islamic finance model and the acquisition and development of real estate assets. Moreover, Islamic finance is a flexible tool which can be used for a wide range of real estate financings………………………………………..Full Article: Source

Indonesia: Islamic banks poised for more growth

Posted on 19 December 2012 by Laxman  |  Email|Print

The assets of Islamic banking in Indonesia will continue their rapid growth next year despite Bank Indonesia’s more stringent rules, according to a central banker. Bank Indonesia required the country’s shariah-compliant lenders to increase the down payment for auto and housing purchases, according to a central banker.
“The global economy is expected to recover and the domestic economy is going to remain positive, providing a conducive business environment for domestic banking,” said Halim Alamsyah, a deputy governor of Bank Indonesia………………………………………..Full Article: Source

Islamic banks to expand, compete for mainstream clients

Posted on 19 December 2012 by Laxman  |  Email|Print

Islamic banks are set to expand as they compete increasingly with conventional lenders in attracting mainstream customers, according to a report by consultancy Ernst & Young released.
The total of all commercial banks’ Islamic assets is estimated to reach $1.55 trillion this year, $1.8 trillion in 2013 and over $2 trillion mark, the report said. Gulf-based Islamic banks now have $450 billion in assets, about 30 percent of the total. Islamic banks will grow as they focus on customers who expect more than just sharia-compliance in terms of products and service and have traditionally relied on conventional banks………………………………………..Full Article: Source

Meethaq well positioned to provide Islamic banking expertise

Posted on 19 December 2012 by Laxman  |  Email|Print

Meethaq, the pioneer of Islamic banking in Oman from Bank Muscat, recorded a momentous year in 2012, bracing itself for innovative Islamic banking operations, subject to approval from the Central Bank of Oman.
With the Royal Decree issued by His Majesty Sultan Qaboos bin Said, establishing Islamic banking operations, Meethaq is well positioned to provide Islamic financial expertise to diverse segments and thereby promote the good of society as a whole………………………………………..Full Article: Source

Noor Islamic Bank launches unique home finance package with fixed profit rate for two years

Posted on 19 December 2012 by Laxman  |  Email|Print

Noor Islamic Bank (Noor), has announced the launch of a unique home finance package with a fixed profit rate for two years, which insulates customers from any EIBOR* (Emirates Interbank Offered Rate) fluctuation during the period.
Noor’s home finance package, which is available to both Muslims and non-Muslims, provides up to 85% finance to the value of Dhs10m for a period of up to 30 years. The profit rates start from 4.75% for all types of transactions. (Press Release)

Al Hilal Bank shares perspectives at world’s largest gathering of Islamic financial leaders

Posted on 19 December 2012 by Laxman  |  Email|Print

Abu Dhabi -based Al Hilal Bank joined international discussions on the state and future of Islamic banking during the World Islamic Banking Conference (WIBC) held recently in Bahrain. More than 50 countries were represented and over 1,200 industry leaders and 65 strategic partners, sponsors and exhibitors in attendance to provide a global perspective on Islamic banking and finance.
A Platinum Strategic Partner of WIBC - the world’s largest forum for Islamic financial leaders - Al Hilal Bank actively participated in talks on the dramatic growth of the global Islamic finance sector, which is estimated to be worth more than $1 trillion. (Press Release)

United Arab Bank opens one more branch in Sharjah

Posted on 19 December 2012 by Laxman  |  Email|Print

United Arab Bank (UAB), UAE’s fastest growing bank has opened its latest branch in Matajer Mall - Juraina, Sharjah that coincided with the inauguration of the mall.
The occasion was graced by His Royal Highness Sheikh Sultan bin Mohammad bin Sultan Al Qasimi, Crown Prince and Deputy Ruler of Sharjah and Chairman of the Executive Council and His Excellency Majid Al Futtaim, Founder and President of Majid Al Futtaim Holding. The event was also attended by senior management of the bank. (Press Release)

Maqbool takes helm of MCB Bank

Posted on 19 December 2012 by Laxman  |  Email|Print

Imran Maqbool, a former Bank of America’s official, took the held of the MCB Bank as the banks’ president and Chief Executive Officer, it emerged Tuesday. After securing approval of the State Bank of Pakistan, Maqbool would be taking his new charge from the 22nd of this month, said a bank official.
“This is to inform you that State Bank of Pakistan has granted, in-principle, approval for the appointment of Mr. Imran Maqbool as President/CEO of MCB Bank Limited,” Abdus S. Sami, MCB’s company secretary, told the bank’s shareholders at the country’s three stock exchanges………………………………………..Full Article: Source

Banque Saudi Fransi closes $507mln Sukuk

Posted on 19 December 2012 by Laxman  |  Email|Print

Banque Saudi Fransi, which is part-owned by Credit Agricole, will close a 1.9 billion riyals ($506.6 million) Lower Tier 2 Islamic bond issue on Tuesday, a source familiar with the matter said.
The subordinated sukuk will boost Banque Saudi Fransi’s supplementary capital reserves, or Tier 2 capital. Bonds and sukuk issued to raise Tier 2 capital are usually classed as subordinated debt, meaning they would be below secured creditors in the event of any restructuring………………………………………..Full Article: Source

The Gulf bond and Sukuk Association announces new chair and launches regional initiatives.

Posted on 19 December 2012 by Laxman  |  Email|Print

The Gulf Bond and Sukuk Association (GBSA), the trade association representing the Arabian Gulf fixed income market announced a new Chair of the association’s Steering Committee at its annual dinner held in Dubai yesterday. The GBSA also announced the creation of a sub-committee to further promote asset management within the region as well as the launch of a new Islamic Finance Practice Group.
Giambattista Atzeni, Senior RM Corporate Trust MENA and Turkey for BNY Mellon, has been named the new Chair of the GBSA Steering Committee for 2013, succeeding Andrew Dell , Head of Central and Eastern Europe Middle East Africa Debt Capital Markets and CEO Africa for HSBC………………………………………..Full Article: Source

Malaysia Airlines in no rush to issue third tranche sukuk

Posted on 19 December 2012 by Laxman  |  Email|Print

Malaysia Airlines (MAS) is in no rush to issue the third tranche of its sukuk programme, says Chairman Tan Sri Md Nor Yusof. “We don’t need the funding for now,” he said during the visit of International Trade and Industry Minister Datuk Seri Mustapa Mohamed to MAS-GMR Aerospace Engineering Company Ltd’s maintenance, repair and overhaul facility in Hyderabad, India.
The recovery plans are in place already and going on well. “We will do it when the need arises,” he said when asked when MAS would issue its next sukuk………………………………………..Full Article: Source

Central Bank of Bahrain sukuk Al-Ijara fully subscribed

Posted on 19 December 2012 by Laxman  |  Email|Print

The Central Bank of Bahrain (CBB) announces that the monthly issue of the short-term Islamic leasing bonds, Sukuk Al-Ijara, has been subscribed by 100%. Subscriptions worth BD20m were received for the BD20m issue, which carries a maturity of 182 days.
The expected return on the issue, which begins on 20 December 2012 and matures on 20 June 2013, is 1.10%. The Sukuk Al-Ijara are issued by the CBB on behalf of the Government of the Kingdom of Bahrain………………………………………..Full Article: Source

The first French sukuk

Posted on 18 December 2012 by Laxman  |  Email|Print

As France attempts to launch its nascent Islamic financial sector, its first Sukuk issues finally appeared last summer. Since the first declarations by the Minister of the Economy in 2008, fiscal adjustments concerning Islamic financial instruments have made slow but sure progress, but the development of Islamic products has been very gradual.
However, there has been some progress in the area of Islamic retail banking. In June 2011, Chaabi Bank, The French subsidiary of the Moroccan Banque Populaire Group, opened an Islamic window offering Islamic deposit accounts for private customers……………………………………….Full Article: Source

Saudi Electricity Co’s Islamic debt sparkles

Posted on 18 December 2012 by Laxman  |  Email|Print

Saudi Electricity Company’s Islamic debt has returned 50 per cent more than global peers since its debut almost nine months ago, boosted by the scarcity of corporate-bond investments in the region’s biggest economy.
The state-controlled utility’s dollar-denominated 2022 notes have handed investors 10 per cent since their sale at the end of March, according to data compiled by Bloomberg. The Bank of America Merrill Lynch Global Utility Index returned 6.8 per cent over the same period……………………………………….Full Article: Source

BSF to close $507mln sukuk

Posted on 18 December 2012 by Laxman  |  Email|Print

Banque Saudi Fransi (BSF), part-owned by Credit Agricole, will close a SR1.9 billion ($506.6 million) Lower Tier 2 Islamic bond issue today (Tuesday), a source familiar with the matter said. The subordinated sukuk will boost Banque Saudi Fransi’s supplementary capital reserves, or Tier 2 capital. Bonds and sukuk issued to raise Tier 2 capital are usually classed as subordinated debt, meaning they would be below secured creditors in the event of any restructuring.
Banks in the Kingdom have been boosting capital reserves through debt issuance this year, despite having healthy levels in comparison to international peers, as they look to replenish reserves after strong lending growth in recent years……………………………………….Full Article: Source

Malakoff to issue RM460m sukuk to buy Hicom Power

Posted on 18 December 2012 by Laxman  |  Email|Print

Malakoff Corp Bhd’s move to buy Hicom Power Sdn Bhd for RM575 million will be funded primarily by a sukuk issuance. This is seen as a move to strengthen the MMC Corp Bhd’s energy utilities subsidiary before its initial public offering (IPO) in the second-quarter of next year.
The acquisition of Hicom Power, an operation and maintenance company for power plants, will be funded by issue of sukuk worth RM460 million while the rest will be paid through internally generated funds……………………………………….Full Article: Source

Malaysian bond market expected to grow in 2013

Posted on 18 December 2012 by Laxman  |  Email|Print

The Malaysian bond market is expected to grow between 4.5% and 5% despite the current turmoil in Europe and uncertain prospects in the global economy, according to Hwang Invesment Management Bhd (HwangIM).
HwangIM is still constructive about the country’s bond market and the Malaysia Government Securities (MGS) is still one of the higher yielding sovereign bonds in the region, trading at 3.5% yield for the 10-year MGS. “Foreign investors hold 40% of the MGS and it is the driving influence for the bond market,” its head of fixed income Esther Teo Keet Ying said……………………………………….Full Article: Source

Marc affirms ratings on Konsortium Lebuhraya Utara-Timur’s Sukuk

Posted on 18 December 2012 by Laxman  |  Email|Print

MARC affirms its AA-IS and A- ratings on Konsortium Lebuhraya Utara-Timur (KL) Sdn Bhd’s MYR 820 million Sukuk Musyarakah MTN and MYR 50 million Junior Bonds. MARC affirms its ratings on Konsortium Lebuhraya Utara-Timur (KL) Sdn Bhd’s (Kesturi) MYR 820 million Sukuk Musyarakah Medium Term Notes Programme (Senior Sukuk) and MYR 50 million Redeemable Junior Bonds (Junior Bonds) at AA-IS and A- respectively. The outlook for both ratings is maintained at stable.
The affirmed ratings reflect the satisfactory growth of traffic volume on Kesturi’s toll road concession on the Duta-Ulu Kelang Expressway (DUKE) and the company’s improving financial performance which has been adequate to meet its debt service obligations……………………………………….Full Article: Source

Kazakhstan pushing to better trade ties with Malaysia in Islamic finance, Halal food

Posted on 18 December 2012 by Laxman  |  Email|Print

Kazakhstan is moving aggressively to improve trade ties with Malaysia, especially in the areas of Islamic finance and halal food. “It is important to continue to build and enhance cooperation with Malaysia, as the transfer of expertise has proven successful in generating economic areas in those previously explored,” said the Deputy Chairman, Ministry of Industry and New Technologies Kazakhstan, Erlan K. Khairov.
“In addition to global interest in the Islamic financial system, this effort is in line with our desire to become the country’s halal hub for the Middle East,” he said………………………………………Full Article: Source

Bermuda Island ‘has role to play in Islamic finance’

Posted on 18 December 2012 by Laxman  |  Email|Print

Business Bermuda’s Chief Executive Officer, Cheryl Packwood said: “Offshore jurisdictions like Bermuda have had a role to play in the development of the Islamic finance industry so far and we can do more to contribute to this natural expansion. The discussion should not be about the offerings of each country as competitors, but rather what we can do together with the international Islamic finance community to expand the industry, grow capital and benefit from its growth.
“Islamic finance is not just for Muslims. The principles behind it – transparency, ethical investment, fair dealing and risk and reward-sharing can appeal to a number of investors. The manner in which companies approach Islamic Finance must evolve to embrace this wider audience. This is about both sides participating in the risk and the profit. It is an alternative way and also potentially a very good way to do business and grow economies. ”………………………………………Full Article: Source

Ajman Bank launches new unprecedented home finance offer at 2.99pct

Posted on 18 December 2012 by Laxman  |  Email|Print

Ajman Bank , the award-winning Islamic financial services institution committed to transforming the experience of Islamic banking, announce a new Home Finance offer with an unprecedented profit rate starting from 2.99%.
The move comes as part of the bank’s commitment to further support the growth of the booming real estate sector in the country and, following the Bank’s signing of an MOU with Sheikh Zayed Housing Programme in August earlier this year, is also aimed to address the housing needs of customers and families in the UAE to acquire their dream homes at most affordable rates. (Press Release)

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December 2012
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