The global sukuk market has had another very successful year. 2012 performance was strong, consistent and on a positive trajectory throughout the year with slight bouts of volatility in January, May and August.
Global sukuk, measured by the S&P Dow Jones Sukuk Index, has returned 8% in 2012, 14.2% over two years and 28.8% over five years. These correspond to annualized returns of 8.2%, 6.9% and 5.2% over one-, two- and five-year time frames, respectively………………………………………..Full Article: Source

$140 billion worth of sukuk were issued in 2012 globally, according to Zawya’s 4Q12 Sukuk Quarterly Bulletin, a 64% increase from 2011’s $85 billion. Last year marked the best year on sukuk record, taking the global outstanding sukuk market to an unprecedented height of $240 billion as of end 2012.
Malaysia continues to be the largest sukuk market with $154 billion or 64% of the total outstanding sukuk market, followed by UAE and Saudi Arabia with around $20 billion, or approximately 9% and 8% respectively. Qatar and Indonesia follow, on 7% and 6% respectively. The list of countries of issuers with outstanding sukuk is now longer than ever, counting 22 countries with outstanding sukuk by end 2012, according to Zawya estimates………………………………………..Full Article: Source

Egypt has approved a draft law to allow sovereign Islamic bonds, the country’s finance minister said on Wednesday, as the government searches for new ways to finance an unsustainable budget deficit.
The Islamist-led administration had amended the original draft of the law following criticism from religious scholars. The legislation still needs to be approved by the upper house of parliament, where Egypt’s ruling Islamists hold a clear majority………………………………………..Full Article: Source

Prominent economist and author of Whatever Happened to Egyptians Galal Amin has expressed his doubts on the new Sukuk Islamic bonds the government is introducing. Amin and other economists gave their diagnosis of the Egyptian economy and cast their predictions for 2013 at a media roundtable held at the American university in Cairo (AUC) on Wednesday.
“It is difficult to predict the future,” started the professor emeritus at AUC, explaining that the economic crisis has political causes, among which he mentioned was the lack of security, a lack of trust and above all the nature and content of political discourse bringing Egypt “back to the medieval ages”………………………………………..Full Article: Source

Following a public consultation process, Hong Kong has commenced the legislative process for the introduction of tax changes to permit the issuance of Sukuk.
The proposed legislation was published in a Legislative Council Brief on December 28, 2012, which seeks to establish a level playing field for the taxation of conventional bonds and Sukuk (referred to as “alternative bond schemes” or “ABS” in the legislation) and details tax exemptions for qualifying structures………………………………………..Full Article: Source

The slowdown in bank financing over the past few years due to the global financial crisis has forced borrowers to shy away from the traditional wholesale bank market and seek alternative sources of financing to meet their funding requirements. Capital markets have therefore emerged as a viable source of financing, whether through bonds or sukuk.
According to the Thomson Reuters Zawya Sukuk Perceptions Forecast Study 2013, the total value of the 1,486 sukuk issued between 2010 and the third quarter of 2012 amounted to USD 248.5 billion. This a massive 60+% of the 2,790 sukuk worth USD 396.4 billion issued between 1996 and Q3-2012 came in the past two years alone………………………………………..Full Article: Source

Sime Darby Global, a subsidiary of Sime Darby has received approval from the Securities Commission of Malaysia to carry out a $1.5 billion multi-currency Islamic bonds programme.
Sime Darby Global is a Malaysia-based multinational corporation involved in development, property, energy and utilities and healthcare. The structure, which is the first of its kind by an Asian conglomerate, will allow the corporate to tap any foreign currency of its choice; including the Euro, GBP and Renmibi………………………………………..Full Article: Source

The Central Bank of Bahrain (CBB) announced that the monthly issue of the short-term Islamic leasing bonds, Sukuk Al-Ijara, has been subscribed by 100%. Subscriptions worth BD20 million were received for the BD20 million issue, which carries a maturity of 182 days.
The expected return on the issue, which begins on 17 January 2013 and matures on 18 July 2013, is 1.03%. The Sukuk Al-Ijara are issued by the CBB on behalf of the Government of the Kingdom of Bahrain………………………………………..Full Article: Source

Standard & Poor’s Ratings Services today assigned its ‘A’ long-term issue rating to a proposed $1.5 billion equivalent Sukuk issuance program by Sime Darby Global.
“The issuer is a special purpose vehicle incorporated in Malaysia that Sime Darby Bhd. (A/Stable/–; axAAA) owns. The programme benefits from a purchase undertaking that Sime Darby provides to cover any payment shortfall in a timely manner and redeem the full value of the Sukuk at maturity,” said Standard & Poor’s………………………………………..Full Article: Source

RAM Rating Services has assigned the respective preliminary long- and short-term ratings of AA3 and P1 to Eversendai Corporation’s proposed MYR 500 million Sukuk Musharakah Islamic Commercial Papers/Medium-Term Notes Programme; the long-term rating has a stable outlook.
Eversendai is a specialised construction company, with a primary focus on the niche segment of structural steel works. It is also involved in the construction (including mechanical works and systems installation) of coal-fired power plants and civil construction………………………………………..Full Article: Source

Dubai-based property lender Amlak Finance is in talks with creditors to restructure debts of around AED7bn (US$1.9bn), in the latest attempt to resurrect a victim of Dubai’s property crash.
The sharia-compliant mortgage lender is negotiating with a creditor committee of six members, which includes two government-owned funds as well as Dubai’s largest lender and its biggest Islamic bank, two sources with knowledge of the matter said. They spoke on condition of anonymity as the information is not public………………………………………..Full Article: Source

Four Luxembourg-based companies have launched a Shariah-compliant platform offering custody and administration services for the “increasing number” of Islamic investment funds being domiciled in the country.
The Alliance for Luxembourg Islamic Finance (ALIF) has been created by Amanie Advisors, ADEPA Asset Management, Theisen Law and KBL European Private Bankers. The organisation said it plans to offer services including full Shariah supervision and monitoring, compliance monitoring, liaison with regulatory authorities for approval and the setting up of investment vehicles………………………………………..Full Article: Source

Emirates NBD PJSC’s (EMIRATES) Islamic banking unit expects to double profit in 2013 as individuals and small businesses take out more loans amid Dubai’s economic revival, the chief executive officer said.
Emirates Islamic Bank PJSC, wholly owned by the biggest United Arab Emirates lender by assets, will seek to boost net income to 150 million dirhams ($41 million) this year from about 80 million in 2012, Jamal Bin Ghalaita said in an interview. The lender said last month it would raise capital by 63 percent to 3.9 billion dirhams through a rights issue………………………………………..Full Article: Source

While Malaysia has become an internationally renowned centre for Islamic finance, the general public appear to have a very limited (if not flawed) understanding of it. Most non-Muslims (and some Muslims) appear to be under the impression that there are only some terminology differences between the two, the main one being interest rate being termed as profit rate in Islamic finance.
Such a shallow understanding overlooks the fact that Islamic finance emphasises justice in financial transactions. Justice is a highly-regarded value in Islam………………………………………..Full Article: Source

Malaysia’s Islamic finance services sector now boasts of the world’s largest sukuk market. It also has the second-largest takaful market and a major Islamic banking and securities industry.
Malaysia had also established itself as an intellectual capital in IFS globally, with many research and training initiatives in syariah law as well as finance that were unmatched elsewhere, Oxford Business Group (OBG) stated in its report recently………………………………………..Full Article: Source

With $159 billion worth of contracts to be awarded across the Middle East in 2013, project finance loans are set to rise almost 15 per cent this year, according to bankers. Project finance in the region is expected to grow from about $35 billion in 2012 to about $40 billion this year because infrastructure demand is going to be significant, bankers said.
Others, such as the Shuweihat independent power and water plant in Abu Dhabi, are considering using bonds to refinance debts. Sukuk, or Islamic bond, is also under consideration, with Saudi Arabia’s Sadara Chemical said to be considering a riyal-dominated project sukuk………………………………………..Full Article: Source

Abu Dhabi Equity Partners (ADEP), the Cayman registered Emerging Markets liquidity management instrument specialist, closes Brazil’s first Sharia-compliant agricultural inventory finance transaction. Investment combines mix of asset backed financing, capital and profit protection from Global investment bank, five to ten times US Dollar deposit yield pick-up, as well as global trading houses as counterparties.
ADEP’s physical commodity backed financing sourced from the world’s leading agricultural market provides the Islamic Finance market with an alternative to commonly used paper-based commodity murabahas, which have been questioned as to their Sharia authenticity. (Press Release)

New Islamic theology courses at German universities are proving highly popular, even abroad. The courses were announced only three years ago, but they are already changing the German religious landscape.
Islamic theology is finding its place in German universities at a pace which is surprising many. German academics even speak of Germany acting as a magnet for talent from other European countries. “There’s never been such a process before at European universities,” says Reinhard Schulze, who teaches Islam at the University of Berne in Switzerland………………………………………..Full Article: Source

In line with its continued support to the people of Somalia, the Islamic Development Bank is currently continuing follow-up of its various projects in the country worth around US$ 450,000. They mainly comprise supplying orphanages, hospitals and schools in Somalia’s second largest city, Hargeisa, and other parts of the country with medicine, medical equipment, and other much needed items.
It is also following up on the progress of the delivery of supplies and equipment to women empowerment centers in different Somali cities. The IDB has also provided financing for construction or rehabilitation of 19 irrigation canals in Mudug in the north-central region, Hiiraan and Middle and Lower Shabele regions in the drought hit areas. Once operational, the canals will benefit 2.5 million residents. (Press Release)

Oman Arab Bank launched here yesterday an independent Islamic banking window under the brand name “Al Yusr”. The bank will launch its Islamic operations with the five branches across the major cities of the Sultanate during this year, said Abdul Kader Askalan, CEO, Oman Arab Bank.
Further, in line with CBO requirements, OAB also introduced a 3-member Shariah Advisory Board to ensure the Al Yusr operations are in compliance with Shariah (Islamic law). The OAB Shariah board members are Dr Khalid Salim al Siyabi, Dr Ahmed Subhi Ayyadi and Dr Essam Khalaf al Enezi………………………………………..Full Article: Source

BankDhofar announces the opening of its Maisarah Islamic banking branch in Azaiba in the coming weeks. The branch is in very advanced stages and its opening further cements its commitment to putting its customer’s first, Oman’s community and economic stability.
Maisarah, the newest Islamic banking branch, has a team of highly skilled Islamic banking specialists. Utilising the most advanced technology to ensure Maisarah operates smoothly, they will offer a complete suite of Shari’ah compliant Islamic services that focus on Islamic principals. (Press Release)

Meethaq, the pioneer of Islamic banking in Oman from Bank Muscat, has received the final approval from the Central Bank of Oman (CBO) to begin full-fledged operations. Coinciding with the auspicious occasion of the Prophet’s birth anniversary, Meethaq operations will begin on 21 January at the dedicated Al Ghubra branch.
Sulaiman Al Harthy, Group General Manager – Islamic Banking, said: “In compliance with all regulatory requirements, Meethaq has been granted the operational licence by CBO. Meethaq will operate as a bank within a bank with RO 150 million capital at its disposal which will be appropriated as and when required in step with the business growth opportunities.”……………………………………….Full Article: Source

Malaysia’s AMMB Holdings Bhd aims to sell stakes in both its conventional and Islamic insurance arms by June, potentially extending last year’s run of Asian deals involving global insurers.
“We’d like a partner and we’re open to any types of [partnership] model depending on valuations and who those partners are,” Managing Director Ashok Ramamurthy said in an interview this week. Several parties have shown interest but the company has yet to evaluate them closely, he said………………………………………..Full Article: Source