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Islamic Finance Briefing - Archive | March, 2010

UAE banking assets total $414bln

Posted on 29 March 2010 by Laxman  |  Email|Print

From Ameinfo.com: A recent report by research firm Prime Holdings has said that the banking sector in the UAE still leads the rest of the GCC in terms of assets, which stood at $414bn (Dhs1.52 trillion) in 2009, Emirates Business has reported.
Assets of the UAE banking sector rose by 4.3% year-on-year in 2009 against a 35% compound annual growth rate (CAGR) between 2004 and 2008. The report puts UAE banking assets ahead of Saudi Arabia’s, which reported assets of $365bn……………………………….Full Article: Source

Nigeria: SEC tinkers Islamic finance equities, other products in NSE

Posted on 29 March 2010 by Laxman  |  Email|Print

From Sunnewsonline.com: Equity products of Islamic finance may soon be tradable at the Nigerian Stock Exchange as the Securities and Exchange Commission (SEC) is presently tinkering with various capital market products intended to deepen the depth and breadth of the market.

As part of the plans to increase the range of market offerings, Director General of the apex regulator of the capital market, Ms Arunma Oteh, has revealed the commission’s plan to develop regulatory framework and product innovation for Islamic finance products in addition to developing the fixed income market, second tier market, the alternative investment market and over the counter derivatives like swap……………………………….Full Article: Source

Yemen: Issuing of Islamic instruments are recommended

Posted on 29 March 2010 by Laxman  |  Email|Print

From Yobserver.com: At the conclusion of the conference of Yemeni Islamic banks, participants recommended the need to carry out standards for the issuance of Islamic instruments because of their benefit to the community development.

This is the first conference of Islamic banks organized by the Yemeni Businessmen’s Club on 20-21 March in Sana’a under the slogan “Yemeni Islamic Banks: Reality and Future Prospects.”………………………………Full Article: Source

IDB approves $120 mln for Jubail Refinery and Petrochemicals project

Posted on 29 March 2010 by Laxman  |  Email|Print

From Muslims.net: The Islamic Development Bank (IDB) has approved an amount of $ 120 million to contribute to financing Jubail refinery and petrochemicals project.

It is one of the gigantic refinery projects in the Kingdom of Saudi Arabia. The cost of the Jubail project totals $12.8 billion……………………………….Full Article: Source

Waha Assembly approves AED 1 bln mandatory bonds or Sukuk

Posted on 29 March 2010 by Laxman  |  Email|Print

From WAM: The General Assembly of Waha Capital PJSC, the leading investment holding company enlisted on ADX, approved recommendations of the Board of Directors to issue mandatory convertible AED 1 billion bonds or Sukuk, in addition to distributing 2.5% cash dividends and 10% bonus shares of the company’s paid-up capital.
The announcement came during the Ordinary General Assembly and the Extraordinary General Meetings that took place today in Abu Dhabi, chaired by Hussain Jassim Al Nowais, Chairman of Waha Capital, in attendance of the company’s board members, stakeholders and executive management……………………………….Full Article: Source

RAM forecasts RM60b sukuk issuances

Posted on 29 March 2010 by Laxman  |  Email|Print

From Btimes.com.my: Some RM60 billion of new issuances are expected for Malaysia’s bond and sukuk markets this year, which is about a quarter more than last year.

Government-related infrastructure projects and bank’s capital-raising exercises are projected to form the bulk of the domestic debt capital market’s activity this year, according to RAM Rating Services Bhd……………………………….Full Article: Source

Gulf International Bank plans $800 mln bond

Posted on 29 March 2010 by Laxman  |  Email|Print

From Saudigazette.com.sa: Saudi-owned Gulf International Bank (GIB) plans a SR3 billion ($800 million) bond issue in April to fund its growth in the kingdom, a banking source said, adding to a flurry of issues from Saudi lenders.
“It’s a five-year deal on a floating note basis,” the banking source, who has direct knowledge of the deal, told Reuters……………………………….Full Article: Source

Will a Saudi ETF attract investors?

Posted on 29 March 2010 by Laxman  |  Email|Print

From Arabnews.com: The Capital Market Authority’s recent approval of the first Saudi-listed exchange traded fund (ETF) marks another important milestone in the Kingdom’s capital market history.

With 139 listed companies and over $356 billion in market capitalization, Saudi Arabia is one of the largest equity markets among emerging countries; although its trading value is down 43 percent over last year, Tadawul still trades close to $800 million a day, making it a relatively liquid market……………………………….Full Article: Source

UK - Halal Trading platform

Posted on 29 March 2010 by Laxman  |  Email|Print

From Meattradenewsdaily.co.uk: The first electronic trading platform allowing sharia-compliant companies to raise cash will launch in London in May, the venture capital firm behind the project told Reuters on Thursday.
The Sharia Ummah Securities Information Exchange (UMEX) is designed to provide a platform to companies with a capital value of at least 20 million pounds ($31 million) and looking to raise the equivalent of at least 20 percent of their market value……………………………….Full Article: Source

Nakheel Sukuk investors to make big profit

Posted on 26 March 2010 by Laxman  |  Email|Print

From WSJ: Hedge funds and other investors who bought into Dubai government-linked corporate debt at distressed prices are sitting on a mint after Dubai on Thursday said they will be fully repaid under a restructuring of Dubai World and its Nakheel unit.

Holders of the Nakheel Sukuks, or Islamic bonds, due in 2010 and 2011 will be paid in full and on time, a far rosier outcome than had been anticipated when Dubai rocked financial markets in November by saying it needed creditors to stay their claims………………………………Full Article: Source

Hong Kong Investors Interested in Islamic Instruments

Posted on 26 March 2010 by Laxman  |  Email|Print

From Bisnis.com: Several Hong Kong investors are interested in investing in the domestic Islamic capital market instruments this year as they have expressed during their visit to the Capital Market and Financial Institution Supervisory Agency (Bapepam-LK) office.

“They are interested in domestic capital market investment instruments. They have been asking questions about Islamic instruments and tell us they will invite investors here at the next meeting,” informed Head of the Accounting and Transparency Standard Bureau at Bapepam-LK Etty Retno Wulandari……………………………..Full Article: Source

Nigeria: Islamic banking has come to stay, say CIBN, Lotus

Posted on 26 March 2010 by Laxman  |  Email|Print

From Ngrguardiannews.com: The benefits of implementing of Islamic banking in Nigeria’s financial sector have been emphasised by the Chartered Institute of Bankers Nigeria (CIBN) and Lotus Capital Limited.

Speaking during a workshop on Islamic Finance and Investment Products put together by CIBN and Lotus Capital, the Registrar of the CIBN, Dr. ‘Uju Ogubunka, remarked that Islamic banking has come to stay and that the CIBN will raise people and institution to create synergy in the sector………………………………Full Article: Source

Noor Islamic inks MoU with Rera for escrow services

Posted on 26 March 2010 by Laxman  |  Email|Print

From Tradearabia.com: Noor Islamic Bank has signed an agreement with Dubai’s Real Estate Regulatory Agency (Rera) to offer escrow services based on the new Rera requirements introduced recently.

Galal Kulaib, chief executive, Noor Islamic Bank,and Marwan Bin Ghalita, CEO, Rera, signed the agreement at the Rera headquarters………………………………Full Article: Source

Al-Amanah now operating as Islamic bank

Posted on 26 March 2010 by Laxman  |  Email|Print

From Bworldonline.com: The Al-Amanah Islamic Investment Bank of the Philippines has begun operating as an Islamic bank, even when it continues to be a commercial bank. Al-Amanah Chairman and Chief Executive Armando O. Samia told reporters the lender’s board approved the shift to differentiate Al-Amanah from other banks.

“The preference of the board was for sharia compliant operations,” he said at the sidelines of the relaunch of the bank’s Makati branch on Wednesday night………………………………Full Article: Source

Amanah expects turnaround in 2011

Posted on 26 March 2010 by Laxman  |  Email|Print

From Inquirer.net: Amanah Islamic Bank, which is now under rehabilitation, aims to start posting profit next year, ahead of the 2014 schedule. “We are in training and hiring mode, and refurbishing bank branches. We are also investing in technology. The money we have is essentially for cleaning up the bank,” bank chair Armando Samia told reporters Wednesday night during the opening of a branch in Makati City.

Samia said the bank was expecting to post a net loss this year given its huge spending related to rehabilitation. Nonetheless, he said, the bank had set a bullish target of posting profit starting next year although its rehabilitation program would be completed in 2014………………………………Full Article: Source

QIB set to enter retail insurance market in France

Posted on 26 March 2010 by Laxman  |  Email|Print

From Gulf-times.com: France’s second largest banking group, BPCE, and QIB have signed a memorandum of understanding (MoU) to establish a joint venture financial institution that will develop and market Shariah-based retail banking products in the European country.

The joint venture (JV) will look at developing and marketing mortgage, vehicle and consumer goods finance and deposits and structured and investment products, QIB chief executive officer, Salah Mohamed al-Jaidah told Gulf Times here yesterday………………………………Full Article: Source

Adnif to launch credit card, takaful this year

Posted on 26 March 2010 by Laxman  |  Email|Print

From Business24-7.ae: Abu Dhabi National Islamic Finance (Adnif), a subsidiary of the National Bank of Abu Dhabi, plans to open four new branches and launch its takaful and credit card during the year.

Adnif has achieved impressive growth in 2009 against the previous year. Aref Al Khouri, General Manager, Adnif said 2009 was a growth year despite the global economic meltdown during which most other financial institutions struggled………………………………Full Article: Source

Malaysia: Banking industry facing downward pressures on profitability

Posted on 26 March 2010 by Laxman  |  Email|Print

From Thestar.com.my: The conventional and Islamic banking systems faced significant downward pressures on profitability, particularly in the first half of 2009, as financial market sentiments were dampened and demand for financing and financial services, particularly from businesses, remained subdued.

Increased competition in the financing markets, particularly the retail-based segments, continued to pose challenges to banks in sustaining revenue growth of the financing portfolios………………………………Full Article: Source

Egypt’s NBD to begin $45 mln rights issue in April

Posted on 26 March 2010 by Laxman  |  Email|Print

From Reuters: Egypt’s National Bank for Development, which is converting to a fully Islamic bank, said it will launch its 250 million Egyptian pounds rights issue next month.

A UAE-based consortium led by Abu Dhabi Islamic Bank agreed on the capital increase, to 2 billion pounds, when it bought a 60.8 percent stake in NDB in 2007………………………………Full Article: Source

Bank Islam Malaysia affirmed by CI

Posted on 26 March 2010 by Laxman  |  Email|Print

From Cpifinancial.net: Bank has extended new credit primarily to salaried employees and government-linked entities. Says bank has adequate capital to support moderate growth in risk assets and sufficient resources to fund that growth without straining liquidity ratios.
Capital Intelligence (CI) said that it has affirmed the foreign currency rating of Bank Islam Malaysia Berhad (BIMB) at BBB- long-term and A3 short-term with a support rating of 2. The ratings are underpinned by the bank’s majority government ownership………………………………Full Article: Source

Dubai offers $9.5bln support for debt-laden firms

Posted on 26 March 2010 by Laxman  |  Email|Print

From Reuters: Dubai’s government said on Thursday it would support the restructuring of debt-laden state-owned firms Dubai World and Nakheel by providing $9.5 billion in new funding.
Dubai’s request for debt payment delays in November shook global markets and raised wider concerns among international investors about transparency and disclosure standards in the region………………………………Full Article: Source

Shariah depositors’ funds may be haram

Posted on 26 March 2010 by Laxman  |  Email|Print

From Thejakartapost.com: A discussion at Nahdlatul Ulama’s (NU) 32nd national congress in Makassar, South Sulawesi, ended Thursday with a conclusion that Shariah banks in Indonesia had yet to provide fully ‘halal’ fund management.

A young scholar who was also the deputy head of the contemporary religious issues deliberation division at NU headquarters, Cholil Nafisia, said Islamic institutions in Indonesia still lacked ability to verify funds managed by Sharia banks………………………………Full Article: Source

The Islamification of Britain continues: First Islamic stock exchange to be launched in London

Posted on 26 March 2010 by Laxman  |  Email|Print

From Bnp.org.uk: The steady colonisation of Britain by Islam has taken another step forward with the announcement that a sharia-compliant Islamic stock exchange is to be launched in London in May. The electronic trading platform, which will allow “sharia-compliant companies” to raise cash, is called the Sharia Ummah Securities Information Exchange (ShariaUMEX).
The aim is to further strengthen the foothold of sharia-companies in Europe which have sprung up as a result of decades of mass immigration polices promoted by the Tory/Labour ruling elite………………………………Full Article: Source

Kuwait-based Arab Investment and Export Credit Guarantee improves liquidity

Posted on 26 March 2010 by Laxman  |  Email|Print

From Globalarabnetwork.com: Standard & Poor’s Ratings Services said today that it raised to ‘AA’ from ‘AA-’ its counterparty credit and insurer financial strength ratings on Kuwait-domiciled The Arab Investment and Export Credit Guarantee Corp. (Dhaman). The outlook remains stable.

“The upgrade reflects the company’s improved liquidity following recovery of long-outstanding debts during 2009,” said Standard & Poor’s credit analyst Kevin Willis. This action has also improved the quality of capital, and Dhaman retains very strong capitalization………………………………Full Article: Source

Malaysia central bank tightens sharia rules for Islamic banks

Posted on 25 March 2010 by Laxman  |  Email|Print

From Reuters: Malaysia’s central bank announced rules to tighten sharia compliance at Islamic banks including raising sharia advisers’ accountability and independence, and requiring audits on banks.

Disputes on the compliance of certain products such as a recent case involving Kuwait’s Investment Dar have put the spotlight on the role of sharia advisers in approving products and their relationship with bank management……………………………..Full Article: Source

Malaysia: BNM to issue 7 more banking licences

Posted on 25 March 2010 by Laxman  |  Email|Print

From Theedgemalaysia.com: Bank Negara Malaysia (BNM) will issue seven more banking licences - five for conventional banking and two for Islamic banking.

Its governor Tan Sri Dr Zeti Akhtar Aziz said the five conventional licences will be issued to those from Asia, Europe and the Middle-east……………………………..Full Article: Source

Asian Finance Bank cultivates Islamic finance talent

Posted on 25 March 2010 by Laxman  |  Email|Print

From Csrdigest.com: Asian Finance Bank (AFB) seeks to cultivate more talent in Islamic Finance. In pursuit of this, the bank will sponsor ten University Technology Mara (UiTM) students in their first degree in Islamic banking.

AFB chief executive officer Datuk Mohamed Azahari Kamil said the bank and UiTM would work together to identify the recipients…………………………….Full Article: Source

Islamic Bank: Global asset worth 750bln US dollars

Posted on 25 March 2010 by Laxman  |  Email|Print

From Sunnewsonline.com: The global asset of Islamic banking industry has been estimated at 750 billion United States dollars, an Islamic financial expert and Chief Executive, Metropolitan Skills Ltd, Abuja, Hajia Ummahani Amin, has said.

She spoke in Kano at a workshop entitled: Fundamentals in Islamic Finance Workshop for International Islamic Economics and Management of Sciences Project……………………………..Full Article: Source

Kuwait’s NBK to up capital by 10 pct in Q2

Posted on 25 March 2010 by Laxman  |  Email|Print

From Maktoob.com: National Bank of Kuwait, the country’s largest lender said Tuesday it has got the approval to increase the capital by 10% during the second half of this year.

“The increase represents 10% of the Bank’s paid capital after adding the bonus shares that have been recently distributed as per the decision of the Bank’s extraordinary annual general meeting”, the bank’s chief executive Isam Jasem Al Sager said in an e-mailed statement……………………………..Full Article: Source

Malta: Guidance note on shariah compliant funds issued

Posted on 25 March 2010 by Laxman  |  Email|Print

From Timesofmalta.com: A guidance note for shariah compliant funds has been issued by the Malta Financial Services Authority. The note explains how the legal and regulatory framework established under the Investment Services Act would apply to shariah-compliant funds established under Maltese law.

The MFSA stated that Malta’s principles-based regulatory regime lays emphasis on the disclosure of all information that the investor needed to know before taking the investment decision and on the transparency of investment management process itself……………………………..Full Article: Source

Malaysia: New financial system blueprint being drawn up

Posted on 25 March 2010 by Laxman  |  Email|Print

From Thestar.com.my: A new blueprint for the financial sector is being drawn up to realise the nation’s vision of becoming a developed economy by 2020. Another key milestone in the coming years is the review currently undertaken on the existing legislations governing financial institutions and intermediaries.

While the new Central Bank of Malaysia Act 2009 reinforces Bank Negara’s mandates on preserving monetary and financial stability, the proposed enhanced legislation will provide further clarity to its powers, supporting a differentiated regulatory and supervisory regime that best achieves the mandates given to the central bank, including promoting a sound, progressive and inclusive financial sector……………………………..Full Article: Source

Islamic finance offers stability as a financial system

Posted on 25 March 2010 by Laxman  |  Email|Print

From Infozine.com: As the world reels from the knock-on effects of the US subprime crisis, many are questioning the validity of the current financial regime and asking what should replace this flawed system.
Leading Islamic Finance experts Iqbal, Mirakhor and Krichene make a strong case for adopting principles of Islamic Finance……………………………..Full Article: Source

Dubai World negotiates debt plan

Posted on 25 March 2010 by Laxman  |  Email|Print

From Aljazeera.net: International bankers have gathered in the United Arab Emirates to finalise a multi-billion dollar debt plan to restructure the troubled Dubai World conglomerate.

Creditors from 97 banks met in Dubai on Wednesday to discuss ways to restructure the company’s $26 billion debt……………………………..Full Article: Source

Back to basics strategy for Gulf Finance House

Posted on 25 March 2010 by Laxman  |  Email|Print

From Gulf-daily-news.com: Gulf Finance House (GFH) yesterday signalled a back to basics strategy, which will see it concentrating on a core business of creating financial institutions.

That was the message from chairman Dr Esam Janahi after shareholders at the bank’s annual meeting at the Gulf Hotel gave their support to the bank’s strategy to return to profitability……………………………..Full Article: Source

Islamic finance in Sri Lanka

Posted on 25 March 2010 by Laxman  |  Email|Print

From Dailynews.lk: Islamic finance is certainly the fastest growing industry in the world, worth over US $ 1 trillion to date-a 28 percent increase from last year, which clearly demonstrates the industry’s potential despite the global financial crisis and the consequent economy downturn. Interestingly, the industry is already catering to a non-Muslim customer base as much as 15 percent throughout the world.

The Sri Lankan financial sector remained comparatively insulated from the global financial crisis, despite the fact, like the island’s conventional finance sectors, Islamic finance has also witnessed insolvency before even the industry kicked off……………………………..Full Article: Source

Gulf’s first ETF to open on Abu Dhabi bourse Thursday

Posted on 25 March 2010 by Laxman  |  Email|Print

From Reuters: The Gulf’s first exchange- traded fund (ETF), launched by National Bank of Abu Dhabi, will begin trading on the Abu Dhabi bourse on Thursday, in a move to attract more international investors.

The new fund, the NBAD OneShare Dow Jones UAE 25 ETF, will provide investors with exposure to 25 blue chip companies in the United Arab Emirates and will be traded on the Abu Dhabi Securities Exchange (ADX)……………………………..Full Article: Source

Malaysia: Islamic capital market achieved significant milestones in 2009

Posted on 25 March 2010 by Laxman  |  Email|Print

From Bernama: The Islamic capital market achieved significant milestones last year with landmark issuance and listing of US dollar denominated sukuk, Bank Negara said.

Despite the downturn in the global economy and heightened risk environment, the Islamic capital market in 2009 saw the landmark issuance of the US$1.5 billion Emas Dollar Sukuk and US$3 billion Emas Dollar Bond by Petronas……………………………..Full Article: Source

UAE bourse merger seen likely as deals slump

Posted on 25 March 2010 by Laxman  |  Email|Print

From Arabianbusiness.com: A slump in trading revenues and Dubai’s delicate financial state could lead to a merger of the UAE’s two main stock exchanges, analysts said.

The Gulf Arab emirate has three bourses - the Abu Dhabi Securities Exchange (ADX), Dubai Financial Market (DFM), and Nasdaq Dubai - each fighting to draw liquidity……………………………..Full Article: Source

Islamic bonds tipped to rise 24pct in ‘10

Posted on 25 March 2010 by Laxman  |  Email|Print

From Arabtimesonline.com: Emad Al Monayea, Chairman and Managing Director of Liquidity House said that Islamic banking is growing at a rate of 10-15 percent per year with signs of consistent future growth. He also added that Islamic banks have more than 300 institutions spread in 51 countries, including the United States, as well as an additional 250 mutual funds that comply with Islamic principles.
It is estimated that over $822 billion worldwide Sharia-compliant assets are managed, he said citing The Economist. This represents approximately 0.5 percent of total world estimated assets as of 2005. According to the CIMB Group Holdings, Islamic finance is the fastest-growing segment of the global financial system and sales of Islamic bonds may rise by 24 percent to $25 billion in 2010……………………………..Full Article: Source

Bahrain launches oversubscribed $1.25 bln bond

Posted on 25 March 2010 by Laxman  |  Email|Print

From Reuters: Bahrain launched an oversubscribed $1.25 billion 10-year bond at 200 basis points over mid-swaps on Wednesday, mopping up pent-up demand for Gulf sovereign issues.

The bond attracted orders of $5.5 billion, banking and fund management sources said, and the launch spread tightened from initial guidance of 210 bps over mid-swaps. Investors had initially expected a smaller $1.0 billion deal……………………………..Full Article: Source

National Bonds announces the biggest draw in the UAE

Posted on 25 March 2010 by Laxman  |  Email|Print

From Albawaba.com: In celebration of its 4th anniversary, National Bonds Corporation PJSC, the Sharia compliant saving scheme has announced its new mega draw format. From its present weekly draw structure, National Bonds will be moving on to a weekly and monthly draw format effective 1st April 2010.
Having taken the leadership role in promoting the savings culture in the country, National Bonds Corporation PJSC, has now taken a major step towards creating thousands of weekly winners from over half a million bondholders……………………………..Full Article: Source

Banque Saudi Fransi says raises $650 mln via EMTN

Posted on 25 March 2010 by Laxman  |  Email|Print

From Reuters: Banque Saudi Fransi 1050.SE on Wednesday confirmed it raised $650 million in a euro medium-term note which were priced at 175 basis points above mid swaps.
“The subscription’s volume has exceeded the targeted amount of this transaction … with some $3 billion,” the bank said in a statement posted on the bourse’s website……………………………..Full Article: Source

Dubai 5-year CDS falls

Posted on 25 March 2010 by Laxman  |  Email|Print

From Tradearabia.com: The cost of insuring Dubai’s debt against restructuring or default fell on Wednesday and troubled Dubai World subsidiary Nakheel’s 2011 Islamic bond rose as markets awaited a restructuring deal for the conglomerate.

Dubai World will discuss how it plans to repay its commitments this week with an informal bank panel……………………………..Full Article: Source

Insurance and Takaful industry expects to grow further

Posted on 25 March 2010 by Laxman  |  Email|Print

From Bernama: As Malaysia progresses towards a high-income economy, household expenditure on healthcare is expected to increase especially with a growing middle-class population.

Insurers and takaful operators are expected to respond to such developments by providing more cost-effective options to consumers, said Bank Negara Malaysia (BNM) in its Financial Stability and Payment Systems Report 2009 released here on Wednesday……………………………..Full Article: Source

Takaful Re turnaround with profit of $10 mln

Posted on 25 March 2010 by Laxman  |  Email|Print

From Cpifinancial.net: Takaful Re bounced back in 2009 with profit for the year of $10 million, against a net loss of $10.6 million in 2008. In view of the significant growth in performance and profitability, Takaful Re’s Board of Directors recommended a cash dividend of 3.8 per cent on paid up capital ($0.038/share) amounting to $4.75 million.
Shareholders approved the payment at the company’s Annual General Meeting held Sunday, 21 March 2010 in Dubai……………………………..Full Article: Source

Dow Jones Islamic Market Indexes in March: All eyes on the emerging markets

Posted on 25 March 2010 by Laxman  |  Email|Print

March 2010 has been “the month of the emerging markets.” Both the Dow Jones Islamic Market Index (DJIM) series and the conventional Dow Jones indexes saw composites from the Middle East and East Asia on the rise.

After a humble 2010 debut, the Dow Jones Dubai Financial Market (DFM) Titans 10 Index was boosted by rumors that Dubai’s state-owned conglomerate Dubai World is in an advanced stage in negotiations with its creditors over a restructuring of its crippling US$26 billion debt. The Dow Jones DFM Titans 10 Index jumped 12.21% higher, closing at 2,422.61 points (as of the close of trading on March 23).

The next largest gainers were the DJIM South Korea Index (up 8.64% at 800.79 points) and the DJIM Hong Kong Index (7.96% higher at 1,510.40 points). As a direct comparison, the conventional bellwethers Dow Jones Industrial Average in New York added 5.46% (closing at 10,888.83 points (note that 8 is the lucky number in Asia)) and the Dow Jones Europe Index ended at 267.50 points (up 5.70%).

The emirate of Dubai, home of Dubai Islamic Bank - which is the oldest regulated Islamic financial institution - and the United Arab Emirates (UAE) are undergoing a series of radical changes. Its building boom might have slowed, but Dubai has successfully constructed the first metro system on the Arab peninsula, which has been in operation since September 9, 2009.

“Dubai 2.0 will not be a remote place in the desert anymore, but a well-connected international hub”, says Jeff Singer, CEO of Nasdaq Dubai. Moreover, the Gulf States have projects worth a whopping US$2.2 trillion in the pipeline, according to Dr. Nasser Saidi, Chief Economist of the Dubai International Financial Centre DIFC. Take Kuwait, for example: The small northern Gulf state alone announced a five-year plan worth an astounding US$104 billion in mid-March.

Shares of Kuwait National Airways have been added to the DJIM GCC Index, which covers Shari’ah-compliant stocks from Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. They are considered Shari’ah-compliant (or pure) because civil airlines usually do not or post rather insignificant turnover with pork, pornography, tobacco, weapons, or interest-bearing financial products.

Another new addition to the DJIM GCC Index is Vodafone Qatar, which saw a US$1 billion IPO in May 2009. The DJIM Kuwait Index dropped by a quarter percent and finished at 861.95 points - one of the worst composites of March. But, remarkably, it is still the top-performer on a year-to date basis (up 10.55%). At the bottom of the charts, the DJIM Sri Lanka Index plummeted two percent and closed at 1,661.61 points.

According to Jennifer Choi, Director of Research, Emerging Markets Private Equity Association, emerging markets have not seen a major decline in the market for non-capital market financing, bringing innovative firms “from Main Street to Wall Street”. “ In 2009, 26% of all private equity (PE) deals worldwide - which stood at US$85 billion - were done in the emerging markets in South America, Eastern Europe, the Middle East and North Africa and East Asia”, Ms. Choi explains. Rising activity private equity is seen as a prelude for increasing capital market liquidity. Privately financed firms, mergers or acquisitions are often followed by IPOs, listed spin-offs or bond issues.

However, PE firms and banks are focused more than ever on the “old economy” rather than on IT and biotech-firms, as they used to be. Consequently, the DJIM Industrials Index closed 7.59% higher at 1,491.97 points - the highest of the DJIM industry indexes. All Shari’ah-compliant industry composites gained territory in March.

By Gérard Al-Fil

Global Sukuk issuance to reach $17 bln in 2010

Posted on 24 March 2010 by Laxman  |  Email|Print

From Reuters: Market participants are hoping sovereign borrowers will issue international Islamic bonds, or sukuk, to kickstart a sluggish market, but many governments are moving only slowly in that direction this year.
Global sukuk issuance is likely to range between $15-17 billion in 2010, down from $19 billion last year, a recent Reuters poll shows. Following are possible sovereign sukuk issues:…………………………….Full Article: Source

Dented sukuk market starved of sovereign benchmark

Posted on 24 March 2010 by Laxman  |  Email|Print

From Reuters: Sovereign borrowing still eludes the Islamic bond, or sukuk, market, leaving investors hungry for a benchmark issue to reinvigorate trading after the credit crunch and the Dubai World crisis.

Where issuance from euro zone and emerging market borrowers in 2010 has been fast and furious, with emerging market borrowers alone issuing over $50 billion, there have been no sovereign sukuk issues at all……………………………..Full Article: Source

Cashflow a must says Islamic finance chief

Posted on 24 March 2010 by Laxman  |  Email|Print

From 7days.ae: The Islamic bond market will struggle to regain its position for a long time if an alternative for creating short-term cashflow is not developed, according to a senior figure at a leading Islamic finance company based in Dubai International Financial Centre.

Abdulrauf Sivany, managing director of Islamic finance at Global Commo-dity Finance, said that it is crucial the Islamic financial sector devises a method to allow Islamic bonds or ’sukuk’ investors to generate liquidity when needed……………………………..Full Article: Source

Danajamin to guarantee Kencana’s Sukuk Mudharabah program

Posted on 24 March 2010 by Laxman  |  Email|Print

From Bernama: Danajamin Nasional Bhd has entered into an agreement to guarantee Kencana Petroleum Bhd’s RM250 million Sukuk Mudharabah programme.

In a statement here on Tuesday, Danajamin said the agreement marks a key milestone for the country’s first financial guarantee insurer, established to help financially viable Malaysian companies tap the sukuk or bond market for capital raising……………………………..Full Article: Source

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