Islamic banking sector is increasingly facing liquidity risk across all geographical regions. The situation is more challenging in the GCC region, said an expert. He called for the industry leaders and the regulators to create new instruments and develop fresh policy tools for the liquidity risk management in the Islamic industry sector.
Dr Salman Syed Ali of Islamic Research and Training Institute, Saudi Arabia, cautioned that the Islamic banking sector might also go the way of conventional banks, unless effective tools are not in place immediately………………………………………..Full Article: Source

Some in the Islamic banking industry lamented that the difference between the Islamic banking and conventional banking is becoming thinner by the day. Experts attending the ongoing 8th International Conference on Islamic Banking and Finance believe that the present Islamic banking system is no different from interest based banking.
“The Islamic banks are doing business the same way as the conventional banks and the only difference is that, proverbially speaking, the interest-based banks hold the nose straight, while their Islamic counterparts catch it by twisting the arm around their neck,” said Dr Sayyid Tahir………………………………………..Full Article: Source

European Islamic Investment Bank is in talks to acquire a 30% stake in Dubai-based Rasmala Investment Bank, two sources with knowledge of the matter told Reuters . The acquisition, which is set to be completed in early 2012, will be made through a fresh issue of shares by Rasmala which EIIB will buy, the sources said.
“EIIB is working out a certain formula with Rasmala for the capital increase,” a source, who declined to be identified because the talks are private, said. “They’ve agreed on the main terms but fine tuning some details.”……………………………………….Full Article: Source

European Islamic Investment Bank confirmed it was talking to Rasmala Holdings Limited about an investment, after two sources told Reuters the group was in talks to buy a 30 percent stake in its Dubai-based Rasmala Investment Bank unit.
In a statement to the London Stock Exchange on Thursday, EIIB confirmed it was in talks with Rasmala Holdings Limited “in relation to an investment,” adding it expected to be “in a position to update the market early in the New Year.”……………………………………….Full Article: Source

Yemen’s Islamic banks, which have been shut down for the best part of the last nine months in battles between pro- and anti-regime forces in the capital Sana’a, are now preparing to open up to the public.
Most of the offices had to close as street-to-street fighting in the capital had made it too dangerous to venture downtown but are now starting to get back to business as barricades and military checkpoints are cleared in the wake of the GCC-backed peace deal that will see president Ali Abdullah Saleh step down to be eventually replaced by a civilian-elected government………………………………………..Full Article: Source

A senior leader of the ruling Congress Party of India has emphasized the need to introduce an interest-free Islamic banking and financial system in the country in order to improve the economic condition of its poor through microfinance and mobilize funds required for the country’s infrastructure projects.
“If we are able to make Islamic finance available it would bring great benefits for our country and people,” said M. M. Hassan, who is also a former state minister of overseas Indians’ affairs………………………………………..Full Article: Source

An obsession with run-of-the-mill products and services has left Middle East Islamic banks closing 2011 in a comatose state with regards to innovation, according to Islamic finance gurus.
For some time observers have warned retail banks that their offering of mundane Islamic credit cards, home loans and Takaful products was unsustainable. These warnings have now reached fever pitch. As another year looms, it seems that without radical change, Islamic banks could sleepwalk towards a crisis of customer apathy as they fail to find a better way forward other than simply mimicking conventional products………………………………………..Full Article: Source

Ethiopia is expected to have its first Islamic bank by the first half of next year when Zam Zam Bank, currently in its formation stage, will start operations. Zam Zam Bank has been established but not operating since 2008 when the country’s central bank, the National Bank of Ethiopia, amended the country’s banking regulations to allow interest free banking.
By August this year, officials of the bank, currently trading as Zam Zam Bank Share Company, said they had raised ETB330m ($19m), surpassing the initial target of ETB250m ($14.4m)………………………………………..Full Article: Source

Former Minister of Finance, Chief Olu Falae, has canvassed a secular name for the non-interst banking system, currently known as Islamic Banking, to remove the prevailing religious connotation on it and thereby, widen investment interests.
He made the prescription in Lagos, on Tuesday, at a one-day colloquium organised by Centre for Righteous Living (CRIL) and The Moslem Congress (TMC), with the theme: “Inter-Religious Dialogue on Islamic Banking.”……………………………………….Full Article: Source

Malaysia will allow foreign banks to own bigger stakes in local lenders, grant more licenses and ease short-selling rules as it seeks to triple the size of its finance sector by the end of the decade, the central bank said.
Financing that complies with Islam’s ban on interest may account for 40 percent of the total by 2020, up from 29 percent in 2010, the central bank said. Malaysia’s debt securities market has almost tripled over the past decade to 867 billion ringgit ($273 billion), it said in report………………………………………..Full Article: Source

Malaysia has announced plans to allow more foreign investment in the banking sector in a bid to boost economic growth. It said the government will be more flexible in letting foreigners hold stakes in banks and will also issue banking licences to foreign firms.
Malaysia’s central bank said the cap on foreign ownership will depend on the financial profile of the investor. Foreign ownership of commercial banks in Malaysia is capped at 30% currently………………………………………..Full Article: Source

It has been reported that the Malaysian Prime Minister Najib Razak unveiled fresh plans to liberalise the country’s financial sector in a bid to develop it as an international Islamic hub.
“The financial system will have a key role in spurring new areas of growth, and facilitating our economic transformation,” he said in remarks contained in a report by Bank Negara………………………………………..Full Article: Source

The Tanzanian Islamic banking scene is heating up as the year closes with the People’s Bank of Zanzibar, a state-owned commercial bank, launching an Islamic banking window just days after the mainland witnessed the launch of the country’s first fully Islamic bank, Amana Bank.
Zanzibar is an island in the Indian Ocean under the administration of the unitary government of Tanzania. The island’s population is 99% Muslim offering a thriving base for the Islamic banking model………………………………………..Full Article: Source

Malaysian Airline System Bhd (MAS) and AirAsia X Sdn are joining Emirates in planning sales of Islamic bonds as banks curb lending on Europe’s debt crisis. MAS, voted Asia’s leading air carrier by World Travel Awards this year, may sell sukuk to partly fund an order for RM12 billion (US$3.8 billion) of aircraft due to be delivered by the end of 2014, chief executive officer Ahmad Jauhari Yayha said.
AirAsia X, the region’s first long-haul budget service, may issue syariah-compliant debt to expand its fleet, CEO Azran Osman Rani said……………………………………….Full Article: Source

In a move that could position SA at the forefront of the global Islamic Sharia law-compliant sukuk (bond) market, national treasury has called on banks to submit proposals for the issue by government of a sukuk.
“A sukuk would create a benchmark for other emerging markets and corporates,” says treasury spokesman Bulelwa Boqwana. The nature of the possible sukuk has yet to be clarified and banks involved in the tendering process are not permitted to divulge any information………………………………………..Full Article: Source

The value of sukuk investments held for safekeeping in NASDAQ Dubai’s custody has risen by 36% in the past year, from $100m dollars to $136m dollars. The increase in the value of sukuk investments held for safekeeping in NASDAQ Dubai’s custody holdings, which are maintained in the exchange’s Central Securities Depository (CSD), reflects the wide range and competitive pricing of the CSD’s services to participants.
As well as custody, these include settlement of over the counter cross-border transfers and processing of corporate actions, such as interest and profit payments and redemption………………………………………..Full Article: Source

The Financial Markets Association of Pakistan (FMAP), in collaboration with NIFT, has launched two new Sukuk revaluation benchmark rates pages. These rates are to be used by Islamic banks, Islamic banking windows and mutual fund managers to revalue their holding of Islamic bonds on a daily basis.
FMAP’’s mandated 6 brokers (who are already contributing to the PKRV page for fixed income bonds), are contributing rates for these pages………………………………………..Full Article: Source

A year-end rally in Dubai-related bonds sends a positive signal for 2012, suggesting more investors are becoming convinced the emirate can arrange smooth refinancings for state-owned firms next year.
Government-related entities in Dubai have bonds worth $3.8 billion (Dh13.95 billion) maturing in 2012. With the real estate market still soft, the stock market uncertain and many banks reluctant to lend because of global financial instability, investors have worried that some of those bonds might be restructured, with changes to repayment terms that disadvantage creditors………………………………………..Full Article: Source

Is it about time that Islamic investment funds start screening out the companies doing business with the countries that are not friendly towards Islam and Muslims and other companies supporting causes and movements that have a hostile attitude towards Islam?
As being part of an over one trillion dollar Islamic financial services industry, should Islamic investment funds start a new journey of investors activism to promote causes that are in line with Islamic civilisation and discourage businesses and activities deemed undesirable from an Islamic viewpoint……………………………………….Full Article: Source

Malaysia needs to leverage on innovation and focus on producing premium halal products if it wants to realise its ambition of becoming a hub for the global halal industry, says an industry member.
Halal Industry Development Corp’s (HDC) managing director cum chief executive officer Datuk Seri Jamil Bidin said the country needed to produce premium halal products to differentiate itself from the producers of mass products. “If we focus on mass products, China and Thailand have the advantage as they are more productive,” he told Bernama………………………………………..Full Article: Source

A recent market research survey found that 80% of American Muslims do not use Islamic finance, while an equal number already buy Halal brands. Rafiuddin Shikoh, managing partner of DinarStandard who commissioned the report told The Islamic Globe there was a “latent need” for Islamic financial products and cited the finding that many Muslims remain unconvinced that Islamic finance was authentic.
American Muslims are “a skeptical bunch” and according to Shikoh, many of those interviewed for the report said they questioned whether Islamic finance was not just conventional finance repackaged at higher cost………………………………………..Full Article: Source

Economic demand is an essential part of life. Every human being requires things, goods, and services for their daily lives. Some more essential than others. The Qur’an says that to acquire those things that humans need they must work for them.
That labor and effort are a prerequisite for receiving any goods that are in demand. However, the things that Muslims can work at or create are limited to those that have been declared Halal by the Qur’an………………………………………..Full Article: Source

According to ratings agency A.M.Best, Allianz SE, the Asia-Pacific subsidiary of Allianz Insurance of Germany intends to expand its reach across South East Asia in 2012. Currently operating in Indonesia, Allianz SE offers unit-linked and individual health Takaful products in the country.
Conventional insurers are at present allowed to sell Takaful products in Indonesia, but companies can only offer either family or general Takaful policies. For general Takaful, Allianz Utama Indonesia provides car and house protection for individuals and property and business interruption coverage to SMEs. Capital requirements for Takaful companies in Indonesia are lower than for conventional insurers………………………………………..Full Article: Source

Silkbank Limited and Dawood Family Takaful Limited have entered into a strategic partnership whereby Silkbank shall sell Shariah compliant family Takaful products through its branch network under “Bancatakaful Agreement”.
A ceremony was held at head office of Silkbank, Karachi to sign the agreement. The agreement was signed by Talha Saeed, Group Head Retail Banking, Silkbank and Rizwan Ahmed Farid, Chief Executive Officer, Dawood Family Takaful………………………………………..Full Article: Source

The 4th Fiqh Conference for Islamic Finance Institutions called here Wednesday for removing the obstacles facing the Islamic Sharia-compliant banking industry which asserted itself as efficient tool for financial management regionally and internationally.
Addressing the opening session of the two-day gathering, Sheikh Ojail Al-Nashmi said the Islamic finance institutions were awarded international certificates for excellence and dynamism in prodding economic development………………………………………..Full Article: Source