Return, revisit, renew

Rapids • Deals • News • Takaful • Asset Management • Ratings • Moves
24th September 2014 (Volume 11 Issue 38)
Return, revisit, renew Sometimes a crisis can show us a new way of approaching a problem, while sometimes it just takes a little time to recuperate before we revisit. While Islamic finance put in a sturdy performance through the economic turbulence of the last decade it has not been immune, and one of its biggest blows was the extinguishment of American aspirations, as US markets recoiled hurt and investors pulled back. But as health returns to the global financial markets we are seeing rising interest on both sides: and our cover story this week explores the renewal of participation from one of the world’s biggest economies. Our IFN reports continue the journey with encouraging developments in the field of human capital, a look at the long-awaited sovereign from South Africa, a review of the burgeoning market in the Maldives and of course our weekly sovereign Sukuk round-up among a host of other material; while our case study features the recent Bank of Tokyo-Mitsubishi (Malaysia)-ICD Murabahah financing agreement and our in-house analyses look at Singapore and the derivatives market. Our correspondents this week come to you from Sri Lanka and Saudi Arabia; while we also have a feature on the Indonesian infrastructure sector from Instansyah Ichsan of Samuel Aset Manajemen and a country feature from George Mickhail of the University of Wollongong, Australia. Our special reports this week come from M Mahbubi Ali and Dr Romzie Rosman of ISRA writing on capital charges for non-compliance risk, and an update from the ICD on the opportunities with its new Ijarah companies. With an international issue spanning the globe and multiple sectors within it, we hope you enjoy the final issue of September and we look forward to the birth of a new month bringing with it new challenges and new goals. Cover Story Home of the brave: Where next for Islamic finance in the US? With the surprise return of Goldman Sachs to the Islamic debt capital market last week, a groundswell of new funds entering the asset management arena and increasing activity in the US property market, it looks as if Islamic finance could be back on the map for the world’s biggest economy. But will the US remain a featherweight or finally step up to fight in its own division? IFN Reports • IFN Global Trendswatch • Company Spotlight: Club Ethis Investment Network • Saudi insurance market improves, but only for selected few • IFN Deal Summary: Dollar denominated deals close the gap • BML’s Islamic subsidiary: a stepping stone for Maldivian opportunities • South Africa debuts Sukuk, surging ahead to become Africa’s Islamic finance hub • Industry and academia must connect to meet human capital gap • IFN Weekly Poll: With the merger between CIMB, MBSB and RHB expected imminently, the prospect of an Islamic megabank finally draws nearer. But does the industry actually need this? • Japanese funding for Islamic finance • Sovereign Sukuk: Luxembourg feeling the heat • ICD aids Brunei in Islamic leasing area • IDB raises international profile, achieves tightest pricing for US$1.5 billion global Sukuk • Goldman Sachs — comeback kid? IFN Country Correspondents • Saudi CMA opening up to foreign investment • New players, new development • Goldman Sachs gets back in the Sukuk business IFN Sector Correspondents • Merger and acquisition: Moving towards better efficiency and profitability of Takaful companies • Corporates turning to Sukuk for construction projects in Turkey IFN Country Analysis • Singapore: Opportunities for Islamic finance IFN Sector Analysis • Islamic derivatives: A continuous development Shariah Pronouncement An Islamic bank is preparing to launch home finance product for its customers Case Study A first for BTMU Malaysia The Malaysian operations of Japanese banking conglomerate Bank of Tokyo-Mitsubishi UFJ provided a US$100 million Shariah compliant financing facility to the Islamic Corporation for the Development of the Private Sector (ICD) Special Reports ICD Ijarah companies – rationale and strategy An integral part of ICD’s mandate is to promote development and growth in member countries by developing new Islamic finance channels such as specialized Ijarah companies that focus on the under-banked SME segment in these markets. Is there a need for capital charge on Shariah non-compliance risk? Shariah non-compliance risk is a unique type of risk in Islamic banking operation, which indicates a significant portion of risk that Islamic banks are exposed to. Features Is there hope for Islamic banking in Libya? Libya has had a long and troubled relationship both with Islam and Islamic finance, and as the country continues to suffer through internal divisions and warring factions the future for a framework for Shariah compliant banking in the country looks less than positive. GEORGE MICKHAIL provides his personal views on the issues keeping the country from unison. Indonesian infrastructure and Islamic finance Infrastructure is an important sector that plays a major role in the Indonesian economy: as it directly contributes to GDP formation and provide additional input in the production process of other sector while indirectly raising the nation productivity through the reduction of the transaction costs (Indonesia’s logistics cost accounts for approximately 25% of GDP a level higher than its regional peers).  CONTACTS Editorial: Sasikala Thiagaraja Direct Line: +603 2163 7800 ext 34 Finance: Faizah Hassan Direct Line: +603 2162 7800 ext 26 Sales: Dubai: Geraldine Chan Direct Line: +971 4 427 3628 Kuala Lumpur: Steve Stubbs Direct Line: +603 2162 7800 ext 55 Subscriptions: Dubai: Mithun Gangolli Direct Line: +971 4 427 3638 Kuala Lumpur: Siti Amilia Amir Amzah Direct Line: +603 2162 7800 ext 27