Back to basics

33 days to go Home Contact Us Subscribe Advertise Events Training REDmoneyGroup Back to basics The Islamic finance industry is constantly reinventing itself, as it adapts and changes to the demands, requirements and external pressures of its environment. While we often focus on the newer entrants to the game, we should not forget the stalwarts of the sector who support and sustain the foundations of the industry. This week, our cover story looks at one of the pioneers of Islamic finance, Bahrain, to celebrate its achievements and review its recent progress following the unrest of the past few years. Our IFN reports span both the old and the new, covering the evolving Islamic asset management industry, the struggles of Sabana REIT, Hong Kong as the next potential hot Sukuk destination, the upcoming Omani Sukuk, the transforming banking landscape in Saudi Arabia and Islamic securitization. We also kickstart our weekly coverage of the great Sukuk race between non-Muslim countries in issuing sovereign Sukuk. Our case study looks at Saudi Electricity Company Sukuk while our sector analyses feature Oman and Sukuk. Our features this week focus on Oman, with contributions from Mohammad Haris from Sohar Islamic and Anthony Coleby from SASLO. We also have a Takaful feature by Ezzedine Ghlamallah, the founder director of SAAFI. It is an action-packed issue this week, and we hope you enjoy it as much as we do. Cover Story Firm foundations: How Bahrain is (re)building Islamic finance From pole position a few years ago as a pioneer of Islamic finance, Bahrain has slipped behind as political and social issues impeded its progress. And while the island kingdom struggled with its own challenges, other regional jurisdictions such as Dubai and Qatar have emerged to assert their own claims in the Islamic finance space. (Click to read full report) Shariah Pronouncement: A company involved in the trade of gold and diamonds has approached an Islamic bank seeking a financing facility (Click to read full report) IFN Reports: The race is on! Sabana REIT struggling in a challenging market Innovative approach makes waves in Islamic asset management Hong Kong: The next Sukuk destination? From construction to retail: The competition heats up Islamic securitization — a new approach to asset bundled securities in the West? Omani Sukuk: A matter of initiative IFN Country Correspondent: Qatar's upgrade IFN Sector Correspondent: Searching for Islamic finance investors in global private equity The slow growth of Shariah products: Time to stop blaming others IFN Country Analysis: Islamic finance in Oman: The industry’s new up and coming market IFN Sector Analysis: Sukuk: The face of Islamic finance Special Report: Durham declaration: Roadmap for future prospects of risk-sharing Case Study: SEC’s largest Sukuk issuance to date (Click to read full report) Features: Oman’s Islamic banking sector: A review Following the introduction of Oman’s Islamic banking framework, the country has taken steps to initiate Shariah compliant services across its finance sector. MOHAMMAD HARIS explores the conditions in which the market now finds itself. ... (Click to read full report) Islamic finance and Oman: One year on A full year after Oman finally issued its Islamic banking framework, ANTHONY COLEBY examines the state of its Shariah compliant finance sector and the challenges it continues to face — and why the impact of the new legislation has so far failed to live up to expectations. The sultanate of Oman was the last of the countries of the GCC countries to implement regulations for its banks to market Shariah compliant financial products to its customers... (Click to read full report) Perspectives of Takaful in France Of the 16 million Muslims in the EU, France is not only home to the largest Islamic population in Europe; but in proportion to its size and population is also the largest Muslim community in the Western world. With its banking and insurance penetration rate among the highest in the world (99% have access to banking services), French Muslims are among the best-served in the world in terms of financial services... (Click to read full report) DEALS Central Bank of Bahrain monthly Sukuk Ijarah issuance oversubscribed by 325% European investors targeted for Indonesia’s forthcoming global Sukuk Sovereign Sukuk from Hong Kong to be issued in September according to monetary authority Pakistani government planning for local currency Sukuk issuances worth up to US$5.6 billion, according to industry player Al Bayan Holding Company’s Sukuk Wakalah will be due and payable on the 24th April Dubai Islamic Bank working on Sukuk sale in Pakistan and considering launching foreign remittances bond to attract investment into the republic Gulf International Bank to privately place US$533.17 million-worth of floating notes Varlik Kiralama Anonim Sirketi issues US$500 million Sukuk with a 5.38% profit rate Midciti Sukuk proposes US$923.18 million Sukuk Murabahah program Request of proposal to be submitted to industry players for Omani sovereign Sukuk, confirms source Profit payment for Nu Sentral’s US$184.63 million Islamic medium-term note program due end of April NEWS IIFM calls for Sukuk standardization MSM Shariah Compatible Index commences trading Besraya Eastern Extension funded by ‘AA3’ rated Sukuk opens for business Meezan Bank expands consumer financing product suite with generator financing in partnership with Honda Atlas Power Products Senai-Desaru Expressway holds EGM to deliberate and vote on proposed restructuring of Sukuk programs World Bank to open branch in Malaysia in order to gain knowledge of Islamic finance, according to prime minister Malaysian prime minister says country’s Islamic banking assets rose by 16.5% in 2013 Indian Forum for Interest-free Banking launches interest-free goat-farming finance facility in Kerala Eight developing nations meet to discuss Islamic banking and finance in Islamabad RHB Islamic transportation chief faces charges of criminal breach of trust worth US$181,030 Askari Bank signs MoU with Atlas Honda to launch motorbike Ijarah facility for consumers Affin Bank still intending to establish an Islamic bank in China through its Hong Kong-listed shareholder, according to deputy chairman Integration and standardization key to more international Sukuk issuances MCB forgoes acquiring shares in Burj Bank and opts to establish separate Islamic banking subsidiary instead to enhance Shariah compliant business London Stock Exchange holding event in May to encourage UK corporates to enter Islamic debt markets IDB to contribute US$217 million towards construction of Iraq’s Expressway No. 1 JPMorgan moving towards a larger role in the Sukuk market Bahrain Institute of Banking and Finance to explore opportunities for affiliation with UK universities Dubai Chamber of Commerce highlights Islamic banking ties during the Cyprus Business Forum First Gulf Bank introduces negotiable certificate of deposit program via Singaporean branch to capitalize on increasing investment flow between Asia and the Middle East IFSB confirms list of speakers for the 11th IFSB Summit to take place next month HSBC Bank Oman to sell operations in India to Doha Bank in the second half of this year Saudi Arabia submits proposal to the IDB and Muslim World League to harmonize Halal organizations under a single umbrella Islamic financiers biggest contributors to surge on Doha and Dubai bourses following speculations of potential investment and increased foreign ownership limits KHCB taps into the real estate sector with Ithmaar Development Company Alkhair Capital Saudi opens new office in Dubai International Financial Center Central bank of the Philippines in discussion with Malaysian counterpart on designing Islamic banking legal framework Governments of Bahrain and Kazakhstan join hands to promote the latter’s Islamic banking industry Islamic banking assets make up 40% of 2013 total Arab banking assets worth US$3 trillion, according to Union of Arab Banks Slowdown in GCC issuances in the first quarter drives global Sukuk market down by 15.2%, reports KFH Research Banks in Bahrain and Qatar ready to implement Basel III standards by 2015 Turkey and Qatar in talks to strengthen bilateral economic ties including possible investment in Turkish power sector Abu Dhabi Islamic Bank expands its branch network with the opening of 78th UAE branch Iran to begin to address the challenges facing the country’s banking sector according to IMF report Dubai Islamic Bank confirms implementation of new 25% foreign ownership limit Bank Muscat opens three new corporate banking branches Shareholders approve capital increase for Banque Saudi Fransi Commercial Bank of Dubai to establish offices in Hamyriah Free Zone by way of an MoU Kuwait International Bank ready to enforce FATCA regulations Al Baraka Banking Group to distribute 3.5% dividend on the 29th April Al Rajhi Bank approves capital increase via bonus shares Zain Saudi looking to breakeven with the acquisition of fixed line capacity from competitors in a bid to expand services Ahli United Bank unable to confirm nor refute rumors of possible merger as no official announcement has been made Kuwait Finance House strengthens market ties with local used car and marine equipment vendors Warba Bank launches new retail promotional campaign Executive president of Central Bank of Oman confident that Islamic banks in the sultanate will be able to break-even in three years’ time Qatar Islamic Bank inaugurates new branch featuring ladies banking center in Al Shahaniya Abu Dhabi Islamic Bank rewards priority customers with prize draw New legislation required for government Sukuk issuances, according to Kuwait’s central bank governor Samba Financial Group reports a net profit gain of 7.1% for the first quarter of 2014 Bank AlJazira will discuss bank capital increase during EGM to be held on the 20th May 2014 Abu Dhabi’s rental market sees rise in property values, according to new report from Abu Dhabi Islamic Bank First Gulf Bank rebrands as FGB in a bid to expand domestically and internationally SABIC has no plans to sell Sukuk unless there is a need to, according to chief financial officer Dubai advancing towards the goal of becoming global Islamic economic hub but there is a need for international Islamic indicators to quantify progress, says CEO of Dubai Islamic Economy Center Capital Market Authority confirms the establishment of Kuwait Stock Exchange as a company and moves towards IPO Meethaq promotes Shariah compliant saving for children Dubai bourses anticipated to receive boost in value of Sukuk to US$19.67 billion following Damac Real Estate’s Sukuk listing Emirates Islamic expands consumer wealth management product offerings with two new salary transfer packages Economic recovery and improving credit appetite set to expand Dubai Islamic Bank’s financing growth by 10% this year Bank Muscat announces net profit surge of 59.1% for the first quarter of 2014 Bank Aljazira announces first quarter net profit of 42.39 million The Company for Cooperative Insurance announces first quarter pre-Zakat profit increase to US$10.57 million National Bank of Bahrain announces net profit gain of 12.1% for the first quarter of the year Saudi Arabian banks register a 6% growth in profit for the first quarter Qatar Islamic Bank sees net profit for the first quarter increase by 15% Sharjah Islamic Bank records 30% rise in net profit for the first quarter Al Madina for Finance & Insurance reports revenue loss for a second consecutive year Doha Insurance Company announces net profit gains of US$6.4 million for first quarter SABB Takaful reports net profit increase of 2.97% for the first quarter of 2014 Bank Dhofar announces first quarter profit of US$26.47 million Dubai Islamic Bank Pakistan’s asset base rises by 26% in 2013 Oman United Insurance reports 3.6% increase in net profit for the first quarter Kuwait Finance House reports net profit increase of 13% for first three months of 2014 Amana Cooperative Insurance Co posts US$2.08 million loss for the first quarter of 2014 Bank Sohar’s net profit growth up 30.85% in the first quarter National Bank of Oman beats analyst predictions with 20% increase in first quarter net profit Growth in operation transaction leads to 41.96% increase in AlAhli Takaful Company’s first quarter net profit Kingdom Holding posts 14.8% increase in net profits for the first quarter of 2014 Wataniya Insurance Company’s first quarter net profit surges by 1,270.52% Net profit of US$851,003 reported for Saudi Arabian Cooperative Insurance Company for the first quarter of 2014 Dubai Islamic Bank subsidiary Tamweel reports drop in Islamic finance earnings for first quarter of 2014 Bank of Bahrain and Kuwait declares 7.1% growth in first quarter net profit Improved operating performance significantly lowers Warba Bank’s total losses for the first quarter Solidarity Saudi Takaful Co reports a net loss of US$11.15 million AlJazira Takaful Taawuni marks first quarter of 2014 with 231.31% surge in pre-Zakat net profit Abu Dhabi Islamic Bank’s first quarter net profit up by 20.4% Al Rajhi Company for Cooperative Insurance returns to profit in the first quarter attributed to increase in gross contributions written Salama Cooperative Insurance Co swing back to profit in the first quarter as net earned premium increases TAKAFUL Takaful firms withdraw constitutional petition against Takaful Rules 2012, opts for settlement Takaful Emarat confident of a profitable year since its establishment, according to CEO Al Madina Takaful signs agreement to provide Takaful coverage to Maisarah Islamic Banking Services customers Takaful operators need to exercise prudence and avoid under-pricing to gain market share, says industry expert Dubai names health insurance providers ahead of mandatory health scheme roll out Takaful Ikhlas to introduce new product in December Consortium which includes Al Khaleej Takaful Group and Qatar Islamic Insurance Company wins Qatar’s largest single project-wide construction and liability insurance policies RATINGS MARC affirms ‘AAAID’ rating for Sime Darby’s US$1.38 billion ICP/IMTN program Strong financial performance boosts Dubai Electricity and Water Authority’s issuer rating to ‘Baa2’ Etiqa Insurance & Takaful’s ‘AAA/Stable/P1’ claims-paying ability ratings reaffirmed by RAM Capital Intelligence reaffirms Modern Sukuk’s Islamic debt ratings based on stable cash inflow S&P assigns negative outlook to Weqaya Takaful Insurance and Reinsurance Co ‘BBB’ rating MOVES President and CEO of United Bank tenders resignation after 10 years of service