Convoluted evolution

19 days to go Home Contact Us Subscribe Advertise Events Training REDmoneyGroup Convoluted evolution This week we have seen a busy array of activity in the Islamic markets, much of which highlights not only the increasing sophistication and regulation of the industry, but the growing competition and convoluted paths by which eager new jurisdictions enter the fray. Our cover story looks at the interesting dichotomy between Russia’s apparent reluctance to extend encouragement to an Islamic banking framework, and its urgent need for alternative sources of funding following the recent sanctions, which are pushing it towards tapping the Muslim markets. Our IFN reports this week follow the theme of innovation, sophistication and evolution: with a look at the new amendments Dubai has made to its investment laws to encourage Islamic funds; the economic stabilization in Bahrain leading to new hope for its Islamic finance sector; the competition between countries to gain an foothold in the CIS region; the impact of Bank Asya’s fall from grace for Turkey’s participation banking sector; the new trend of perpetual Sukuk and what they mean for Islamic bank funding; and finally, as always, the latest sovereign Sukuk activity from around the world. Our analysis reports cover the US and tax, while our case study looks at the NBAD Islamic MENA Growth Fund. Our IFN correspondents this week bring you updates from the US and Nigeria, as well as news from the real estate sector. We have special reports from Chowdhury Shahed Akbar of Standard Bank Bangladesh on the opportunities in Islamic microcredit; and from Kwaku Kyei of Ghana Islamic Microfinance on what his company is doing to promote the sector. Our features come to you from David Loundy of Devon Bank writing on Islamic finance in the US; and Roustam Vakhitov of Baker Tilly discussing issues in Shariah compliant accounting and tax. As the markets begin to wake up from the sleepy summer season and we march onwards into autumn, we hope to look forward to some exciting activity ahead. Cover Story Rewarding risk: The unlikely impetus for Islamic finance in Russia The push for Shariah compliant finance in central Asia is set to receive a significant boost from renewed Russian interest as sanctions impede conventional operations, drive up borrowing costs for banks and dry out the traditional avenues of financing from the West. With the negative impact of sanctions having a potentially positive effect on the growth of the Islamic finance industry, we take a look this week at how opportunities can sometimes emerge from the unlikeliest of places... (Click to read full report) Shariah Pronouncement: An Islamic bank is planning to launch a retail product to fulfill the personal finance needs of its customers (Click to read full report) IFN Reports: Sovereign Sukuk: Indonesia progressing well, South Africa slowly Fresh prospects in Bahrain on the back of economic stabilization Perpetual Sukuk: The newest star in the fixed income firmament Dubai’s law amendments seek to amplify investment activity in the emirate Ahead of the curve: Central Asian states seek edge in Russian market Bank Asya – the unfortunate casualty Selling the ideal: Marketing and Islamic finance IFN Country Correspondents: Lotus Capital to issue Shariah compliant ETF in Nigeria American Muslim investors donate US$3 million to charity IFN Sector Correspondent: Scotland the brave? IFN Country Analysis: Land of opportunity? Islamic finance in the US IFN Sector Analysis: Constant and true: Tax and accounting in Islamic finance Special Reports: Towards a just microcredit system Asset-based Islamic microfinancing in Ghana Case Study: NBAD Islamic MENA Growth Fund (Click to read full report) Features: Islamic finance in the US: A review of the ups and downs five years post-crisis According to the US National Bureau of Economic Research, the Great Recession in the US ended five years ago this summer (the same year the IMF declared that the conditions for a global recession were finally met). DAVID LOUNDY looks at how has Islamic finance fared in the US during the recession and since... (Click to read full report) Tax and accounting efficiency: Islamic finance evolves Recent developments show further growth of the Islamic finance industry. ROUSTAM VAKHITOV discusses the tax and accounting rules and regulations in countries where recent deals have been successfully conducted; which appear to be efficient to accommodate the needs of Islamic investors and professionals of the industry... (Click to read full report) DEALS DanaInfra Nasional’s third retail Sukuk garners a 103.95% subscription rate South Africa looking at the option of introducing retail savings Sukuk Malaysian sovereign wealth fund raises US$476 million through Sukuk Sunway receives approval to set up RM2 billion (US$632.31 million) Sukuk Mudarabah program Experts predict Indonesia’s proposed global Sukuk will yield less than Islamic notes sold last September as market stabilizes Central Bank of Bahrain continues to receive overwhelming demand for monthly Sukuk Salam IILM’s latest Sukuk auction garners favorable demand including for its inaugural six-month facility Capital Markets Board decides against Bank Asya’s Sukuk as a result of ownership ambiguity Pakistan’s US$500 million Sukuk plan hangs in the balance as political uncertainty looms NEWS First Community Bank announces plans to attract 50,000 new customers and open four new branches by the end of the year Harvard University’s Islamic Legal Studies Program reviews Islamic finance study scope in light of reconfigured priorities 90 North Real Estate names FBI Colorado headquarters as its first US real estate acquisition Malaysia establishes International Council of Islamic Finance Educators Agrobank launches Shariah compliant trade finance products for SMEs Amãna Bank’s new five-year Ijarah product offers the lowest rental rate in the market Malaysia’s Islamic finance assets set to grow 10-15% over the next five years, according to Association of Islamic Banking Institutions Malaysia Amãna Bank supports Serendib Education Foundation scholarship program for second consecutive year Ziraat Bank deals blow to Bank Asya as it confirms that it will not be pursuing acquisition talks Faysal Bank in talks with the State Bank of Pakistan to begin Shariah compliant operations by December A greater focus on Shariah principles one of the aims for proposed bank merger, according to CIMB Group head Bank Asya major shareholder to face criminal charges for insider trading accusations Analysts highlight Bank Islam as likely merger target for Maybank in the latter’s bid to secure top spot in Malaysia’s Islamic banking space Gatehouse Bank increases real estate investments with leasehold interest in Marriott Residence Inn Allied Bank moves on with Islamic banking plans, targets 20 Shariah compliant branches by next year Dubai Chamber of Commerce highlights family tourism as key area for growth and driver for Islamic economy Investment Corporation of Dubai signs MoU with Export-Import Bank of Korea to boost cross-border finance opportunities For the first half of the year GCC states accounted for 90% of capital raised through IPOs in the MENA region, according to report Dubai Islamic Bank intends to become Bank Panin Syariah’s controlling stakeholder, submits request to Indonesia’s regulator Increasing funding needs of the Gulf region will see Islamic banks raising capital through additional Tier 1 Sukuk, says S&P Central banks in the Gulf region prefer banks to migrate to Sukuk/debt market instead of relying on unsecured term lending as Basel III takes effect Islamic Financial Services Board partners with Financial Stability Institute to jointly organize seminar on banking liquidity risk this October RAKBANK launches app allowing for cardless cash withdrawals Nakheel to repay outstanding bank debt up to four years ahead of schedule, with payment of AED5.54 billion (US$1.5 billion) to be paid to UAE banks today Capital Market Authority seeking public feedback on direct foreign investment draft rules Islamic banking creating new opportunities in Oman’s financial system, according to central bank Kuwait Finance House marks 20% increase in the number of prepaid and credit cards issued for first half of 2014 International investors likely to drive the need for corporate ratings in Saudi Arabia, according to S&P Capital markets to fill funding gap left by banks as a result of Basel III with new Bahraini platform Banks in the UAE should consider in-market mergers to counter overcrowded banking market, says CEO of Emirates NBD Egyptian Takaful Insurance Co announces profit of EGP25 million (US$3.48 million) for first half of the year Amãna Takaful registers flat first half yearly profits at LKR26.13 million (US$201,786) TAKAFUL SECP opens doors for conventional operators to set up Takaful windows Dubai Financial Market General Index closes 1.07% higher, driven by Takaful Emarat’s 14.88% jump Malaysian Takaful companies advised to consider mergers by industry players Takaful Al Rajhi seeking regulatory approval to increase capital Salama Insurance Algeria reveals plan to tap Takaful market this year AIA Public to make first surplus distribution to Takaful customers Al Alamiya for Cooperative Insurance Company submits application for capital increase of SAR200 million (US$53.32 million) to regulator ASSET MANAGEMENT Sabana REIT expects to conclude US$55 million warehouse acquisition in the last quarter of 2014 RATINGS MARC issues preliminary rating for CIMB Islamic’s proposed RM5 billion (US$1.58 billion) Basel III compliant Sukuk program Moody’s assigns ‘Baa3’ rating to Indonesia’s proposed global Sukuk RAM withdraws ‘AAA/Negative’ rating from Emirates NBD’s senior unsecured conventional/Islamic program AM Best assigns ‘B++’ rating to Abu Dhabi National Takaful Company Bahrain maintains global and ASEAN ratings Bahrain Mumtalakat Holding Company’s RM3 billion (US$945.96 million) Sukuk Murabahah program reaffirmed at ‘AA2’ by RAM Halkbank receives ‘BBB+’ rating from Capital Intelligence based on solid overall performance Moody’s downgrades Bank Asya based on poor asset quality, shrinking profitability and deposits Sunway Group’s proposed RM2 billion (US$631.84 million) Sukuk program receives ‘A2(s)/Stable/P1(s)’ ratings from RAM MOVES FGB appoints Michael Aissaoui as head of corporate finance advisory Noor Bank names Rajesh Sethi as head of group strategy and projects National Bank of Kuwait selects Nasser Abdullah Al Sayer to succeed as new chairman Head of Harvard University’s Islamic Finance Project joins Qatar Foundation as director of Center for Islamic Economics and Finance DIFC CEO tenders resignation with immediate effect