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Islamic Finance Briefing - Archive | February, 2013

Market dynamics to influence takaful growth

Posted on 28 February 2013 by Laxman  |  Email|Print

The UAE insurance market’s sustained growth path has allowed it to secure its position as the largest and most developed insurance market in the Gulf region in 2011. Its USD 6.6 billion total insurance premiums during the period recorded a 10% increase compared with 2010.
The UAE’s buoyant performance also represented a 45% share of the GCC’s USD 14.7 billion combined gross insurance premiums, placing it well ahead of its neighbor Saudi Arabia, which accounted for less than 34% of the market, according to the world insurance report compiled by the Sigma research unit of global reinsurance group, Swiss Re………………………………………..Full Article: Source

Shariah funds lure Middle East LPs to Southeast Asia

Posted on 28 February 2013 by Laxman  |  Email|Print

Asian managers, joining a trend from the bond markets, have begun launching Islamic private equity funds in response to interest from investors in the Middle East. For those investors, the new vehicles are a way to capitalize on fast-growing economies in the region, sometimes with more flexibility and attractive terms than are available via local Middle East funds.
Navis Capital Partners in Malaysia and Korea’s STIC Investments are two of the few general partners that manage Shariah-compliant private equity funds across Asia. Kuala Lumpur-based Navis first raised money to invest in Shariah-compliant deals in 2003, while STIC started in 2004………………………………………..Full Article: Source

Dubai to setup watchdog for Islamic financial products

Posted on 28 February 2013 by Laxman  |  Email|Print

The government of Dubai has announced its plans to establish a central Sharia board to oversee all Islamic financial products used in the emirate. The move is also expected to further develop an interest in the Islamic financial markets by encouraging government-linked entities to issue and list sukuk on the local equity market. The plan has been envisaged to strengthen Dubai’s reputation in the Islamic finance market and make it a global hub for all financial transactions based on Islamic principles.
However, Dubai is expected to face stiff competition from London and Malaysia, which have a sound Islamic finance system and are actively involved in trading of sukuk (Islamic bonds). Currently, besides Malaysia, few countries have a central regulatory board and most Gulf countries have a decentralized model of regulation. ……………………………………….Full Article: Source

Dubai launches sukuk initiative

Posted on 28 February 2013 by Laxman  |  Email|Print

On Wednesday, His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, rang the opening bell kicking off the next phase of Dubai’s Islamic economy initiative.
Eissa Kazim, chief executive of Dubai Financial Market and secretary-general of the committee governing Dubai’s Islamic economy initiative, said the goal of the initiative is to promote sharia-compliant activities, with one of those activities being sukuks………………………………………..Full Article: Source

Sukuks to make UAE a top-ranked economy

Posted on 28 February 2013 by Laxman  |  Email|Print

A new initiative to transform Dubai into a global hub for sukuks is aimed at positioning the UAE as a top-ranked economy in the world, His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, said on Wednesday.
Speaking to journalists at the launch of a bold initiative ‘Transforming Dubai into a Global Centre for Islamic Bonds’ at the Dubai Financial Market, Shaikh Mohammed said the UAE, under the leadership of the President, His Highness Shaikh Khalifa bin Zayed Al Nahyan, “seeks to maintain its position as the overall top-ranked economy through such projects and initiatives”………………………………………..Full Article: Source

Interest rises in Islamic bonds

Posted on 28 February 2013 by Laxman  |  Email|Print

Islamic bonds, or sukuk, have long been popular with investors in the Middle East. Now they are being discovered in Europe and the United States. When the Dubai government issued a $500 million, 10-year sovereign Islamic bond, last month, 38 percent of it was snapped up by Western investors, according to research by Standard & Poor’s.
“European problems helped fuel demand for alternative products like sukuk in emerging markets, which is why we’re seeing a strong wave of interest coming in from Western investors lately,” said Mohammed Dawood, managing director of debt capital markets for HSBC’s Islamic banking division………………………………………..Full Article: Source

Egypt: Cabinet approves draft Islamic bonds law

Posted on 28 February 2013 by Laxman  |  Email|Print

The Cabinet approved a draft law governing the issuance of Islamic bonds, known as sukuk, on Wednesday. The proposed regulatory framework will be referred to the Shura Council, which has temporary legislative powers until the House of Representatives is elected in the next few months.
The move is part of an investment program aimed at attracting capital to boost revenues and close the budget deficit slated to reach LE200 billion by the end of 2013. But the bill doesn’t have the support of everyone. Some political factions opposed foreigners being able to own shares of state companies; however, officials claimed the proposed law does not allow foreigners to do so………………………………………..Full Article: Source

Regulations for Egypt sukuk law to take 3 months-minister

Posted on 28 February 2013 by Laxman  |  Email|Print

Egypt can gain around $10 billion in funds annually from its sukuk Islamic bond market but it will at least three months to push through the necessary regulations, Finance Minister Al-Mursi Al-Sayed Hegazy said on Wednesday.
Egypt has only three months of cover for imports left inforeign currency reserves and in December postponed a deal with the IMF for more funds………………………………………..Full Article: Source

DEWA gets $500mln sukuk issue process underway

Posted on 28 February 2013 by Laxman  |  Email|Print

Dubai Electricity and Water Authority (DEWA) has issued initial price guidance for a five-year, benchmark-sized Islamic bond, or sukuk, a document from lead arrangers obtained by Reuters has revealed.
Benchmark-sized is typically understood to mean at least $500 million. The emirate’s sole utility is aiming to sell the dollar-denominated sukuk in the low 3% area, the document said. DEWA is meeting fixed income investors in London and Asia this week ahead of the possible sukuk sale, which is due to price this week………………………………………..Full Article: Source

GCC’s debt capital market stays healthy

Posted on 28 February 2013 by Laxman  |  Email|Print

The GCC debt capital market should score another positive year this year as fundamentals favoring the market are expected to continue, said Sameh Al Qubaisi, General Manager of Corporate Coverage Group at National Bank of Abu Dhabi’s (NBAD) Global Financial Markets.
Speaking at the 2013 Global Financial Markets Forum (GFMF) in Abu Dhabi Wednesday, he said “2012 was a stellar year for capital debt markets and we expect a continued growth and maturing of this sector which will fuel accelerated growth across the economy.” Issuances in the first month and half of 2013 has surpassed $3 billion (AED11 billion), with a number of issuers looking closely to tapping the market at the right window of opportunity………………………………………..Full Article: Source

Thailand: For SME and Islamic banks, what went awry?

Posted on 28 February 2013 by Laxman  |  Email|Print

Plainly speaking, it’s been a complete management failure, both inside and out. How else can one frame the fact that two state-controlled banks, the SME Bank and the Islamic Bank of Thailand, are now wrestling with bad loans in excess of 80 billion baht, or over one-quarter of their total outstanding loans?
When we consider the fact that their peers in the private sector count their own non-performing loans in the low single digits, and that Thai bank profitability overall is at record highs, the performance of these two institutions looks even worse………………………………………..Full Article: Source

Abu Dhabi: Banking mounts comeback

Posted on 28 February 2013 by Laxman  |  Email|Print

The banking sector in Abu Dhabi showed consistent increases in liquidity and net profits throughout 2012, largely aided by net-interest earnings and bigger profits from Islamic finance. Fourth-quarter results and a strong performance by many banks’ shares – the strongest in five years – have led many analysts to conclude that the sector is firmly on the path to recovery.
Indeed, Reuters reported on February 6 that the Abu Dhabi bank index was up by 11.4%, outperforming a 10.1% increase in the overall market, though from an admittedly low base. October 2012 was as a major turning point for the UAE’s banks, when outstanding provisions – which banks set aside for bad loans – decreased for the first time since 2008………………………………………..Full Article: Source

QIIB in ‘lowest profit rate’ loan campaign

Posted on 28 February 2013 by Laxman  |  Email|Print

International Islamic (QIIB) will provide finance to Qataris and residents with the “lowest profit rate,” grace period of up to six months as well as quick and easy processing, the bank said.
QIIB has also come out with an “unique” offer linked to this finance scheme under which it will compensate “1% of the transferred liability” to customers moving their liabilities from other banks. The offer will be in force until March-end, QIIB said. ……………………………………….Full Article: Source

ABC Islamic Bank announces 2012 year-end profit of $8.3mln

Posted on 28 February 2013 by Laxman  |  Email|Print

ABC Islamic Bank announced that its net profit for the year ending 2012 was $8.3m, compared to $8.1m last year. Total operating income amounted to $16m, 6% higher than last year of $15.1m. Operating expenses increased by $0.8m to $6.9mi, resulting in cost to income ratio of 43.3%, compared to 40.8% in last year, mainly due to higher staff expenses related to compensation scheme.
Impairment provision of $0.5m for regional exposure taken during the year was at the same level as of last year.Net profit for the fourth quarter was the same as of last year of $1.4m. (Press Release)

BIMB Q4 profit falls 10.4pct

Posted on 28 February 2013 by Laxman  |  Email|Print

BIMB Holdings Bhd’s net profit attributable to ordinary equity holders of the parent company dropped 10.36% to RM67.13mil on the back of a 17.76% increase in revenue to RM669.17mil for the fourth quarter ended Dec 31, 2012. Thus, earnings per share dropped to 6.29 sen from 7.02 sen. However, on a full-year basis, net profit was up 18.29% to RM250.78mil on the back of a 23.62% increase in revenue to RM2.52bil.
Meanwhile, Takaful Malaysia reported a 31% growth in its profits after taxation and zakat to close the financial year ended Dec 31, 2012 with RM101.2mil. The group’s full-year operating revenue increased by 19% to RM1.61bil………………………………………..Full Article: Source

Malaysia: Exim Bank plans US$1bln sukuk

Posted on 27 February 2013 by Laxman  |  Email|Print

Export-Import Bank of Malaysia Bhd (Exim Bank) plans to sell Islamic bonds in the global market, the second by an Asian company in 2013 after a two-year absence. The state-owned trade finance provider invited proposals from banks to arrange US$1bil (RM3.1bil) of dollar-denominated debt for a possible second-quarter offering, said three people familiar with the deal.
The lender aimed to increase the proportion of syariah loans to 30% of the total in two years from 20% now, chief executive officer Adissadikin Ali said in an interview yesterday, declining to comment on the potential issuance………………………………………..Full Article: Source

Indonesian government raises $1.5 bln from Sukuk sale

Posted on 27 February 2013 by Laxman  |  Email|Print

The Finance Ministry raised Rp 14.9 trillion ($1.5 billion) from the sale of rupiah-denominated Islamic bonds to Indonesian citizens on Monday as part of the country’s effort to raise funds to plug its ballooning budget deficit. The sale of the Shariah-compliant sukuk notes is also intended to spur growth in the Islamic finance sector in the country that is home to the world’s largest Muslim population.
The sukuk, called Sukuk Retail Indonesia (Sukri), will be the first rupiah-denominated Islamic bonds aimed at retail investors in Indonesia this year. “Demand by investors during the offering period was high,” Robert Pakpahan, the director general of the debt management office at the Finance Ministry in Jakarta, said……………………………………….Full Article: Source

DEWA to issue $ 500 mln sukuk this week

Posted on 27 February 2013 by Laxman  |  Email|Print

Dubai Electricity and Water Authority plans to issue an Islamic bond, or sukuk, of at least $ 500 million this week, after releasing early price guidance for the deal on Tuesday. The emirate’s sole utility, rated BBB, is aiming to sell the dollar-denominated sukuk at a profit rate in the low 3 percent area, arranging banks said.
DEWA Chief Executive Saeed Mohammed Al-Tayer indicated last week the sukuk would be $ 1 billion and that proceeds would be used to repay debt………………………………………..Full Article: Source

Dewa issues price guidance for sukuk

Posted on 27 February 2013 by Laxman  |  Email|Print

Dubai Electricity and Water Authority has issued initial price guidance for a five-year, benchmark-sized Islamic bond, or sukuk, a document from lead arrangers said on Tuesday. The emirate’s sole utility provider is aiming to sell the dollar-denominated sukuk in the low 3 per cent area, the document said.
Benchmark-sized is typically understood to mean at least $500 million. Dewa is meeting fixed income investors in London and Asia this week ahead of the possible sukuk sale, which is due to price this week………………………………………..Full Article: Source

El-Najjar: Ministry of finance to issue Sukuk law in June

Posted on 27 February 2013 by Laxman  |  Email|Print

The Ministry of Finance intends to issue the Sukuk project law next June to raise between $500million and $1bn for state coffers, said Ahmed El-Najjar, member of the economic committee at the Freedom and Justice Party (FJP) and advisor to the minister of finance.
He added that a number of projects are currently under review in order to guarantee that the possibility of their financing through sukuk. These projects will be mainly in the fields of transportation and trade, he said………………………………………..Full Article: Source

Egypt: Cabinet endorses Sukuk draft law

Posted on 27 February 2013 by Laxman  |  Email|Print

Minister of Finance’s Advisor Ahmed Al-Naggar said on Monday 25/2/2013 that the final endorsement of the Sukuk Islamic bonds bill, worked out by the government, will take place during the cabinet’s meeting on Wednesday, prior to referring it to the Shura Council for discussion.
During the meeting of the Financial Affairs Committee which convened to discuss the draft law, al-Naggar added that the Sukuk is capable of luring additional foreign investments………………………………………..Full Article: Source

Al-Aqar Capital fully redeems RM300mln Sukuk programme

Posted on 27 February 2013 by Laxman  |  Email|Print

Malaysia’s RAM Ratings has received confirmation from the facility agent that Al-‘Aqar Capital Sdn Bhd (Al-‘Aqar Capital) fully redeemed all the outstanding Class A Islamic Medium-Term Notes (IMTN), Class B IMTN, Class C IMTN and Islamic Commercial Papers (ICP) under its RM300 million Sukuk Ijarah Programme (2008/2013).
Following the above, RAM has withdrawn the respective AAA, AA2, AAA(bg) and P1 ratings of Al-‘Aqar Capital’s Class A IMTN, Class B IMTN, Class C IMTN and ICP, and no longer has any rating obligation on the debt facility………………………………………..Full Article: Source

Scotland could be go-to place for ethical banking and Islamic finance

Posted on 27 February 2013 by Laxman  |  Email|Print

Recent figures from the Islamic Finance Council UK (IFC) show that more than 50% of Scots want to see some of their money invested using green or ethical criteria – meaning the country has an opportunity to become a hub for ethical finance.
The IFC invited governmental representatives, as well as business leaders and academics, to a recent round table discussion, which discussed such topics as marketing challenging and measuring social returns………………………………………..Full Article: Source

Bank Nizwa launches home-finance solution

Posted on 27 February 2013 by Laxman  |  Email|Print

Bank Nizwa, which is purportedly Oman’s first dedicated Islamic bank, introduced its home-finance solution, which will enable its customers to own their own homes.
Addressing a press conference held here yesterday to announce the launch of Bank Nizwa’s home-finance solutions, Dr. Jamil El Jaroudi, CEO of Bank Nizwa, said, “Home finance with a maximum ceiling of OMR450,000 per person will be offered to our customers as part of Bank Nizwa’s strategy to offer to the people of Oman a versatile and wide-ranging product portfolio that is compatible with Islamic Sharia law.”……………………………………….Full Article: Source

Bank Nizwa eyes 5pct of Oman banking market

Posted on 27 February 2013 by Laxman  |  Email|Print

Omani lender Bank Nizwa, the sultanate’s first full-fledged Islamic bank, plans a steady expansion of its retail network with a view to capturing a 5 percent share of the total banking market, according to its CEO.
The country’s two new Islamic banks, Bank Nizwa and Al Izz Islamic Bank, obtained operating licences late last year. They face competition from conventional lenders which plan to launch Islamic windows themselves………………………………………..Full Article: Source

Noor Islamic Bank appoints Narendra Swarup as chief risk officer

Posted on 27 February 2013 by Laxman  |  Email|Print

Noor Islamic Bank has announced the appointment of Narendra Swarup as Chief Risk Officer (CRO). Swarup will be responsible for all the risk functions of the bank.
These include credit, market, operations as well as compliance and governing information security, protecting against fraud and guarding intellectual property through developing internal controls. He is also mandated to ensure the group’s compliance with government regulations and review factors that could negatively affect investments, or Noor’s diversified units………………………………………..Full Article: Source

APICORP unveils $150mln Petroleum shipping fund

Posted on 27 February 2013 by Laxman  |  Email|Print

The Arab Petroleum Investments Corporation (APICORP), the multilateral development bank owned by the Organization of Arab Petroleum Exporting Countries (OAPEC), announced Monday the establishment of APICORP Petroleum Shipping Fund, a landmark $150 million Fund aimed at leveraging growth opportunities in the petroleum product tanker charter market. The government of Saudi Arabia owns a 17 percent stake in APICORP.
The first investment fund to be established by APICORP, the initiative is also the first fund in the region aimed at a specific vessel category. The Fund has acquired five medium range (MR) petroleum product tankers. ……………………………………….Full Article: Source

A peaceful compromise on halal: Charge an equal national peace levy with every halal certificate payment

Posted on 27 February 2013 by Laxman  |  Email|Print

Halal industry is estimated to worth $2.5 trillion world-wide. If nutrition or taste is considered, there is no difference between halal foods and other foods. The certificate guarantees halal compliance to locals, tourists, consumers in export markets and others who profess the faith of Islam.
Multiple aspects of this issue should be looked at to come to an objective conclusion before it serious dents peaceful coexistence in this country. Religious, economic, political, nutrition and social aspects are vital considerations. A national view must be maintained to assess these factors. A limited tribal approach will not be conducive to peace………………………………………..Full Article: Source

Dubai fund ICD in talks over first Islamic bond

Posted on 26 February 2013 by Laxman  |  Email|Print

Dubai’s flagship investment vehicle is in talks with banks to launch its first Islamic bond, three sources with knowledge of the matter said, tapping improved sentiment towards the emirate in a bid to diversify its funding sources.
Although talks are at an early stage, Investment Corporation of Dubai (ICD), which controls some of Dubai’s top companies, expects to complete a deal this year, one of sources said. ICD is taking advantage of increased demand for Dubai debt, which has benefited from international investors seeking emerging market assets, but also improved sentiment driven by a recovery in the local economy and state-linked debt restructurings………………………………………..Full Article: Source

Egypt seeks up to $1 bln from debut Sukuk

Posted on 26 February 2013 by Laxman  |  Email|Print

Egypt plans to raise as much as $1 billion by June from the sale of its first Islamic bonds as the government anticipates a return to political stability will soften the blow of five credit rating cuts.
The cabinet has completed a draft law to allow sukuk sales, incorporating revisions by the ruling Freedom and Justice Party and Shariah scholar Hussein Hamed Hassan, said Ahmed El-Naggar, adviser to Finance Minister El-Morsi El-Sayyed Hegazi. Officials have compiled a list of about 25 projects that could be used as assets to back future sales, El-Naggar said in a phone interview on Feb. 21 from Cairo………………………………………..Full Article: Source

Egypt to join Islamic markets with bond

Posted on 26 February 2013 by Laxman  |  Email|Print

Egypt is planning to enter the Islamic finance markets for the first time by issuing a $1 billion Sharia-compliant bond. Morsi el-Sayed Hegazy, the Egyptian Finance Minister, said that the Government had already drawn up a list of infrastructure projects to be financed by the country’s first sovereign sukuk.
Under Hosni Mubarak, Egypt’s former leader, Cairo showed little interest in tapping the $300 billion sukuk market………………………………………..Full Article: Source

Egypt: Time for a sukuk

Posted on 26 February 2013 by Laxman  |  Email|Print

Egypt’s continued political turmoil has made its life hard in international debt markets, but its government is hoping to secure new funds by less conventional means through the issue of the country’s first sovereign Islamic bonds.
According to a Bloomberg report, the government plans to raise up to $1bn by June through sukuk sales, with one for domestic investors and one for foreign investors. “The international market is waiting for Egypt’s sukuk sale,” said Ahmed El-Naggar, adviser to Finance Minister El-Morsi El-Sayyed Hegazi, to Bloomberg. El-Naggar said in an interview with the news agency that the cabinet has finished a draft law to pave the way for the issuance, which would be debated in parliament this week………………………………………..Full Article: Source

Indonesia sells nearly $1.54 bjn from retail Sukuk

Posted on 26 February 2013 by Laxman  |  Email|Print

Indonesia’s finance ministry sold 14.968 trillion rupiah ($1.54 billion) worth of retail sharia bonds, known as sukuk retail (SUKRI), only slightly below the target of 15 trillion rupiah, an official at the debt office told Reuters on Monday.
The government set the coupon rate at 6 percent maturing in three years. “The incoming bids were more than 15 trillion. We would like to sell 15 trillion but we decided to raise slightly less than that due to double orders which were 50 billion rupiah,” head of the debt office, Robert Pakpahan, said………………………………………..Full Article: Source

Sukuk issuances market expected to see new boost

Posted on 26 February 2013 by Laxman  |  Email|Print

Sukuk, the Islamic equivalent for bonds, has become an option for many when they need stable long-term financing. The instrument that performed extremely well in the last fiscal year (2012) is expected to continue the trend this year.
In fact, this year the issuance of sukuk may even pick up after a little slackening trend in the last quarter of 2012, according to CIMB Islamic Bank Bhd executive director and CEO Badlisyah Abdul Ghani………………………………………..Full Article: Source

Al-‘Aqar Capital fully redeems MYR 300 mln Sukuk Ijarah programme

Posted on 26 February 2013 by Laxman  |  Email|Print

RAM Ratings has received confirmation from the facility agent that Al-‘Aqar Capital fully redeemed all the outstanding Class A Islamic Medium-Term Notes (IMTN), Class B IMTN, Class C IMTN and Islamic Commercial Papers (ICP) under its MYR 300 million Sukuk Ijarah Programme (2008/2013).
RAM has withdrawn the respective AAA, AA2, AAA(bg) and P1 ratings of Al-‘Aqar Capital’s Class A IMTN, Class B IMTN, Class C IMTN and ICP, and no longer has any rating obligation on the debt facility………………………………………..Full Article: Source

Directorate of NSs planning to launch Islamic bonds

Posted on 26 February 2013 by Laxman  |  Email|Print

Directorate of National Savings (NSs) has successfully achieved its annual investment target of Rs 224 billion investment and now planning to launch Islamic bonds. Talking to media person at Karachi office on Monday, Director General National Savings, Zafar M Sheikh, said that so far some Rs 275 billion of new investment had been attracted by the Directorate against the target of Rs 224 billion set for the current fiscal year 2012-2013.
“We have achieved this milestone with the support of energetic team and we are expecting more investment in the remaining period of current fiscal year,” he added. Talking about the performance of the Karachi region, he said that Karachi was still leading all offices with a share of Rs 127 billion in total new investment of current fiscal year………………………………………..Full Article: Source

CBB Sukuk Al-Salam Securities oversubscribed by 223pct

Posted on 26 February 2013 by Laxman  |  Email|Print

The Central Bank of Bahrain (CBB) announced today that the monthly issue of the Sukuk Al-Salam Islamic securities for the BD 18 million issue, which carries a maturity of 91 days, has been oversubscribed by 223%.
The expected return on the issue, which begins on 27 February 2013 and matures on 29 May 2013, is 0.90%. The securities are issued by the CBB on behalf of the Government of the Kingdom of Bahrain………………………………………..Full Article: Source

Kenya Re sets sights on Islamic finance

Posted on 26 February 2013 by Laxman  |  Email|Print

The Kenya Reinsurance Corporation is planning to venture in sharia-compliant business as it seeks to expand its presence in the growing Islamic finance segment. The local reinsurer has confirmed that it will start ReTakaful insurance in the country and the areas where it already has a presence in West Africa and the Middle East markets.
“There is a change in the insurance market and we want to take full advantage when it fully blossoms,” said the firm’s managing director, Mr Jadiah Mwarania, during an interview at the head office in Nairobi………………………………………..Full Article: Source

Oman seeks consolidation in financial sector

Posted on 26 February 2013 by Laxman  |  Email|Print

Oman’s financial regulator, the Capital Market Authority (CMA), is encouraging consolidation in the country’s crowded financial sector, aiming in the long term for local banks to build a regional presence in the Gulf region.
“Maybe we are overbanked in a way, so limiting the number of banks would be better for the market, especially for banks starting from scratch,” Abdullah Salem Al Salmi, CMA’s executive president, said in an interview. “We would like to see some consolidation.”……………………………………….Full Article: Source

Record RM4.35bln net profit for CIMB

Posted on 26 February 2013 by Laxman  |  Email|Print

For the financial year under review, CIMB’s net profit expanded by 7.8 per cent, helping the group push its net profit to a level unseen before in its history. CIMB Group Holdings Bhd has posted a record net profit of RM4.35 billion for the year ended December 31 2012, meeting its 16 per cent return-on-equity (ROE) target.
The banking group expects to maintain a R0E of 16 per cent in the current financial year as it seeks to expand its reach at home and abroad. A ROE of 16 per cent is considered to be at the top end for a major bank as CIMB’s fiercest rival at home, Malayan Banking Bhd, the country’s top bank, also has a ROE of about 16 per cent………………………………………..Full Article: Source

Arqaam hires ex-Credit Suisse banker to head equity sales

Posted on 26 February 2013 by Laxman  |  Email|Print

Arqaam Capital, a Dubai-based investment bank, has hired ex-Credit Suisse banker Wafic Nsouli to head its institutional equity sales unit, tapping into talent from retrenching global banks for its expansion.
Nsouli is expected to join Arqaam on March 18 and will take charge as executive director and head of institutional equity sales, the investment bank said in a statement to Reuters. Before joining Arqaam, Nsouli was head of Middle East and North Africa equities at Credit Suisse, responsible for the company’s offices in Dubai and Saudi Arabia………………………………………..Full Article: Source

New role for KPMG official

Posted on 26 February 2013 by Laxman  |  Email|Print

Global audit, tax and advisory firm, KPMG, has announced the appointment of its Qatar-based partner, Omar Mahmood to head up its financial services practice in the Middle East and South Asia. KPMG’s Middle East and South Asia Chairman Jamal Fakhro said it was important KPMG found the right person for the role given the strategic significance of financial services to the region.
“The financial services industry in this region is developing at a rapid rate,” said Fakhro. “KPMG is committed to supporting this development with outstanding financial services specialists.”……………………………………….Full Article: Source

Islamic parties at an impasse, need reform to avoid the worst

Posted on 26 February 2013 by Laxman  |  Email|Print

There are two interesting facts about Islam in Indonesia. First, more than 87.18 percent of the country’s total population is Muslim. Second, there has been an escalation of Islamic expression since the 1990s, such as women wearing veils, laws and bylaws influenced by Islam, the publication of Islamic books and the proliferation of Islamic banking, clinics, housing complexes and dormitories.
But these facts are not reflected in the political orientation of voters. For example, all Islamic parties won less votes and received less of the national vote than all secular-nationalist parties in three consecutive general elections after the New Order era………………………………………..Full Article: Source

More African countries considering sukuk

Posted on 25 February 2013 by Laxman  |  Email|Print

An increasing number of African countries are considering issuing sukuk, or Islamic bonds, in a push to fund their huge infrastructure needs and to diversify their investor base, Standard and Poor’s has said in a report. South Africa, Nigeria, Senegal, and Mauritania have all announced in recent years their intention to issue sukuk bonds.
Standard and Poor’s said in a report that following the Arab spring and the rising influence of Islamist parties in some countries has put the development of Islamic finance on their governments’ agendas. Egypt for example, has recently presented a law allowing sovereign sukuk issuance, which would help finance the country’s high fiscal deficits and also provide funding for the current account deficit, while Tunisia’s 2013 budget law expects to finance its fiscal deficit partly by sukuk issuance, said the ratings company………………………………………..Full Article: Source

Qatar has potential to become major Islamic finance platform, says QIIB CEO

Posted on 25 February 2013 by Laxman  |  Email|Print

Qatar can become a major global platform for Islamic finance in view of its resources, expertise in Shariah-compliant products and services, and world class regulatory framework, said International Islamic (QIIB) chief executive officer, Abdulbasit A al-Shaibei.
Qatar, he said, is significantly active in the major global Islamic centres such as Malaysia. Also, Islamic finance has growing demand in Qatar and the region………………………………………..Full Article: Source

Phillipines: Market-driven Islamic banking sought

Posted on 25 February 2013 by Laxman  |  Email|Print

Monetary authorities could allow the introduction of Islamic banking products — given the huge market potential — as long as the framework is “market driven.” “Considering that there’s market potential … We can look into the possibility of allowing conventional banks to provide Islamic banking products,” central bank Deputy Governor Nestor A. Espenilla, Jr. said.
“However, we have not received any proposal so far,” he added. “Perhaps the problem is a dearth of providers with sound Islamic banking business models,” Mr. Espenilla noted………………………………………..Full Article: Source

Is Islamic finance and banking for Muslims only?

Posted on 25 February 2013 by Laxman  |  Email|Print

Islamic finance is no longer a dream, rather it is a success story across the world, including some non-Muslim majority countries like, USA, UK, Philippines, Thailand, Hong Kong and Singapore. There are about 430 Islamic finance institutions and 191 conventional institutions having Islamic banking and finance windows in 70 countries. Their total assets size is around $1.6 trillion while the potential size is around $5 trillion.
This sector is growing fast in Bangladesh also, and has already covered about 20% of the total banking assets. It may be mentioned here that Muslims in non-Muslim majority countries practice Islamic banking and finance and some non-Muslims also follow this system, though the percentage is very small………………………………………..Full Article: Source

Meethaq launches Sharia compliant car finance

Posted on 25 February 2013 by Laxman  |  Email|Print

Meethaq, the pioneer of Islamic banking in Oman from Bank Muscat, yesterday launched the first-of-its-kind Sharia compliant car finance product in the Sultanate based on the Islamic financing mode of Murabaha.
Sulaiman Al Harthy, Group General Manager (Islamic Banking), said: “Meethaq is proud to launch the innovative car finance as part of its focus to take the lead in offering a suite of banking products, which combine traditional values with modernity. Meethaq has adopted the best practices in Islamic banking and finance worldwide to combine a robust model which will protect customers and complement the Islamic banking industry………………………………………..Full Article: Source

Bank Nizwa seeks relaxation for investing funds

Posted on 25 February 2013 by Laxman  |  Email|Print

Bank Nizwa is going to request the Central Bank of Oman (CBO) for allowing the bank to get relaxation in deploying funds in overseas markets for a certain period, until Sharia-compliant products are available within the domestic market.
The bank is going to discuss with the CBO for extending the ceiling on overseas investment, until the bank finds these assets in Oman, Dr Jamil Jaroudi, Chief Executive Officer of Bank Nizwa, told Times of Oman, on the sidelines of a seminar on opportunities in Islamic finance in Oman organised by Thomson Reuters in conjunction with the CMA. “Otherwise, you will have Islamic capital sitting idle in the country. They are positive and flexible. We have to go and present them,” he added………………………………………..Full Article: Source

DIB makes formal acquisition offer to Tamweel shareholders

Posted on 25 February 2013 by Laxman  |  Email|Print

Dubai Islamic Bank (DIB) made a formal offer for Tamweel, the Islamic mortgage company in which it owns majority shares. The offer follows the approval from the Securities and Commodities Authority (SCA). DIB currently has i 58.2 per cent of the issued equity of Tamweel.
This bid, which was announced on January 3, 2013, is based on the offer of 10 new DIB shares for 18 existing Tamweel shares held. The fair value of each share for DIB and Tamweel underlying the intended swap is set at Dh2.25 and Dh1.25 respectively. Analysts said the swap offer is below the book value of Tamweel………………………………………..Full Article: Source

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