A rush of Islamic bond sales from the Gulf region in coming months could give companies much-needed access to funds, but it is likely to end a period of unusually low borrowing costs in the sukuk market.
For perhaps the first time in the modern history of Islamic finance, some debt issuers are finding it cheaper to raise money through sukuk than through conventional bonds……………………………………..Full Article: Source

The International Islamic Liquidity Management Corporation (IILM) is expected to issue its first sukuk in the next six months, as it will contribute to better liquidity management, says Bank Negara Malaysia (BNM) governor Tan Sri Dr Zeti Akhtar Aziz. “We are about to get rated for the issuance short-term instruments and we are in the process of all the parameters as well as to get the allocation of high-quality underlying assets.

“This will be proposed to the governing board tomorrow and we hope they will approve the parameters for issuance,” she said……………………………………..Full Article: Source

PLUS Expressways Bhd, Malaysia’s biggest toll-road operator, plans a RM30 billion (US$9.5 billion) Islamic bond program to fund expansion plans after a takeover, two people familiar with the matter said.

Marketing of the Shariah-compliant bonds, or sukuk, may begin either late this year or in early 2012, said the people, who declined to be named as the information is confidential. PLUS currently holds US$3.9 billion of bonds mostly falling due by 2024, according to data compiled by Bloomberg……………………………………..Full Article: Source

The Republic of Indonesia has priced a $1 billion seven-year Sukuk mandated to Citi, HSBC and Standard Chartered on the back of investor expectations that the country may shortly be moved up to ‘investment-grade’ status.
After guidance on 14 November around 4.25 per cent, the Ijarah Sukuk was priced at a profit rate of four per cent on 15 November. Indonesia (Ba1, stable – Moody’s; BB+, positive – Fitch Ratings/ Standard & Poor’s) is clearly benefiting from demand for Islamic instruments. After roadshows in October (notably in Abu Dhabi, Doha, Dubai and Saudi Arabia), some three quarters of the Sukuk had already been accounted for by orders from the Middle East, Malaysia and Indonesia when the issue was formally announced……………………………………..Full Article: Source

Bahrain priced a $750 million seven-year Islamic bond, or sukuk, at a profit rate of 6.273 percent on Wednesday, in line with guidance. The Gulf state, hit by political upheaval earlier this year, had earlier indicated price talk of 450 basis points over midswaps.

Investor meetings for the bond ended on Tuesday. BNP Paribas , Citi, and Standard Chartered are arranging the deal. Bahrain had initially looked to sell a $1 billion conventional bond at the beginning of the year but, having invited banks to pitch for roles on the transaction, was forced to postpone plans amid political unrest affecting the kingdom and the wider Arab region……………………………………..Full Article: Source

Rating agency, Moody’s Investors Service has assigned A1 rating against A awarded by S&P to the $500-750 million Sukuk Trust Certificate being launched by Abu Dhabi Commercial Bank in coming days.

Abu Dhabi second biggest lender by assets plans to issue the Islamic notes this week. Earlier, Abu Dhabi’s Union National Bank floated a five-year conventional issue, raising $400 million……………………………………..Full Article: Source

The growth from the conversion of conventional banking customers into Islamic banking is higher than that from the unbanked market, said Standard Chartered Saadiq global head of Islamic banking (consumer banking) Wasim Saifi.

“So far the growth in Islamic banking has come from customers switching to Islamic banking from the conventional banking space.Banks have not been able to find it profitable or feasible to penetrate deeply into the unbanked population,” he said …………………………………….Full Article: Source

Since Islamic banking and finance has become a reality in Oman following the Royal Directive, authorities have rushed to take necessary steps to establish a regulatory atmosphere for sharia compliant banking and investment.

The Central Bank of Oman (CBO) is following up to pave the way for Islamic banking’s debut in Oman early next year and has already given the nod for establishment of two full-fledged Islamic banks, namely Bank Nizwa and Al Izz International Bank. Currently, commercial banks in Oman are in process to open the doors to Islamic banking services…………………………………….Full Article: Source

Despite its large shares, Indonesia’s absorption of the Islamic Development Bank (IDB) loan remains low. Former IDB executive-director to Indonesia, Karnaen A. Perwataatmadja, said the absorption of IDB funding by the Indonesian private sector was lower than other members.
“In other countries, the benefit was higher than the fee,” he said in a seminar titled Indonesian Private Sector Funding Access from IDB Group Fund Resource in Jakarta……………………………………..Full Article: Source

Al Baraka Islamic Bank BSC, a subsidiary banking unit of Al Baraka Banking Group, announced that it continued to achieve excellent results during the first nine months of 2011. The financial statements of the Bank for the first nine months of 2011 show that net income has amounted to BD 1.36 million during the first nine months of 2011 compared to BD 388 thousand during the same period of 2010, a significant increase of 249%.
This reflects a substantial improvement in the total income of the bank which amounted to BD 12.09 million, compared to BD 8.25 million during the first nine months of 2010, an increase of 46.54%. (Press Release)

Fitch Ratings has affirmed the Islamic Development Bank’s (IDB) Long-term Issuer Default Rating (IDR) at ‘AAA’ with a Stable Outlook and Short-term IDR at ‘F1+’.

The ratings primarily reflect IDB’s strong capitalisation. The bank is one of the most highly capitalised multilateral development banks (MDBs) rated by Fitch. The equity to assets ratio has remained above 65% since inception (70.7% at end-1431H, equivalent to 6 December 2010 in the Gregorian calendar). The IDB also maintains comfortable liquidity and compliance with Sharia’h principles induces extremely low leverage (21.3% at end-1431H)……………………………………..Full Article: Source

Islamic financial institutions must look into expanding out of Islamic countries, says Central Bank of Argentina former governor Dr Martin Redrado. “Islamic finance is being concentrated within Islamic countries, there is more cooperation within the countries than outside.

“They should move out and I would like to see that expansion,” he told the media on the sidelines of the four-day Meeting of Central Banks and Monetary Authorities of the Organisation of Islamic Cooperation (OIC) member countries……………………………………..Full Article: Source

Kerala could become a role model of tapping Islamic finance market to raise badly needed funds for infrastructure development, according to experts. H. Abdur Raqeeb, Convener, National Committee on Islamic Banking at the New Delhi-based Indian Centre for Islamic Finance (ICIF), made a strong pitch for these funds.
The State Minister for Public Works, V. K. Ibrahim Kunju, and the Secretary, PWD, Mr Manoj Joshi, said the State Government wholeheartedly welcomed Islamic funding agencies in the space of infrastructure development. Infrastructure development is as Shariah-compliant a cause as they come, Joshi said……………………………………..Full Article: Source

If Islamic banking is to develop into a global alternative to conventional banking, the global
financial industry must take responsibility for driving the sector forward and not rely on the regulators to lead the way, according to Hussain AlQemzi, CEO of Noor Islamic Bank and a leading Middle East authority on Islamic finance.

Speaking at the International Islamic Finance Summit in Kuala Lumpur, AlQemzi said the pace of development of the Islamic finance sector was too slow and that unless industry practitioners are more willing to challenge the regulators, whether Central Banks, legal structures or Shari’a scholars, the internationalisation of Islamic finance will continue to underperform and not reach its full potential……………………………………..Full Article: Source

A Dubai Judicial Committee that hears cases against Islamic mortgage lender Amlak has dismissed a lawsuit filed by an investor against Amlak and ordered him to pay Dh16.5 million to the company. The investor had filed a lawsuit against Amlak, seeking dissolution of the murabaha contract worth Dh17 million signed between him and Amlak.

The investor also wanted Amlak to pay him Dh651,000 as the value of the first installment of the purchase price paid by him under the murabaha contract. He also demanded that Amlak return the cheque for Dh16.5m issued by him……………………………………..Full Article: Source