Friday, 3rd July 2015
S&P 500 Shariah
Dow Jones Islamic World
FTSE Shariah All World
Russell - IdealRatings Islamic Global
1,815.01
2,918.75
2,042.02
1,904.26
▲ 0.24 (0.01%)
▼ -3.31 (-0.11%)
▼ -2.16 (-0.11%)
▲ 9.51 (0.50%)
HIGHLIGHTS: Afghan parliament discusses Islamic banking law – Standard template for Islamic repos for Indonesia – ACWA funds world’s largest industrial gases project of its kind with Shariah financing
This week's poll question: Which segment of the industry is the main contributor to the increase in global Islamic finance assets?
IFN weekly market roundup: 27th June-3rd July 2015
Daily Cover
GLOBAL: Several exciting deals and developments transpired over the week across multiple sectors including Sukuk and financing, banking as well as regulations and governance, bringing sweet promises for the industry.
Let’s begin in the regulatory landscape: Last week, the Afghan parliament deliberated on the country’s proposed Islamic banking law as part of its approval process. IFN Correspondent for Afghanistan Dr Alam Khan Hamdard confirmed that the parliament will meet again to discuss the legislation in further detail and that it has sought for formal written information and clarification on certain related issues from the central bank.
In the UAE, Dubai will soon be home to a new Islamic Management and Governance Center under a joint initiative by the Institute of Corporate Governance (a unit of the Dubai International Financial Center) and the Department of Economic Development. While over in Abu Dhabi, its international financial center (Abu Dhabi Global Market) has released draft financial legislation for market consultation.
In Oman, the apex bank reaffirmed its commitment to Shariah banking by introducing an independent Islamic Banking Department to oversee the sector, a move viewed positively by the market. “Effective regulation and supervision of Islamic banks achieved through a dedicated unit is positive for the sector as it should strengthen early detection of risks and support growth,” said Fitch Ratings. This development comes at a time when two Islamic banking window operators – Bank Sohar and Bank Dhofar – are taking a step further in their merger plans by proceeding with due diligence under a non-binding MoU.
Oman’s banking sector isn’t the only one which received a boost this week as Malaysia (whose negative outlook has been upgraded to stable by Fitch this week) also leaped forward with a new player to the game. Government-owned Agrobank, which accounted for one-third of the country’s food processing financing market share in 2014, has finally completed its transformation into a fully-fledged Islamic bank since making clear of its intentions to do so in 2008, bringing the number of Islamic banks in Malaysia to 17.
In the funding space, Qatar Islamic Bank paved the way for Basel III Tier 1 Sukuk issuance for the State with its debut QAR2 billion (US$548.54 million) paper, following a similar transaction by Saudi Arabia’s National Commercial Bank last month. Both facilities were the first for the respective countries and signal the growing trend of Basel III-compliant Shariah bonds in the region.
Sydney-based Shariah compliant Crescent Wealth’s foray into the commercial real estate business marks a likely inflection point for Islamic finance development in Australia. The AU$31 million (US$23.84 million) deal was part-funded by National Australia Bank, one of the largest banks in the country, with its new Wakalah instrument – a product IFN Correspondent for Australia, Chaaban Omran described as being the first of its kind for an Australian bank.
Saudi Arabia’s industrial gases project by Arabian Company for Water and Power Development – the largest of its type in the world – is also the first industrial gases project to be financed exclusively on a Shariah compliant basis. According to King & Spalding, advisor to the transaction, the project is being financed by a US$1.7 billion debt package from a consortium of 10 banks.
Rounding off with key industry player movements: The UAE’s Commercial Bank International named Mamoon Abdel Kader as its new head of Islamic banking; Pakistan’s state-backed Bank of Khyber which offers Shariah financial products saw its now previous chairman Dr Hammad Uwais Agha replaced by Dr Ihsanul Haq; while Bahrain’s Investcorp – manager of multiple Islamic funds – announced major shakeups in management including a new executive chairman (Mohammed Al Ardhi) following the retirement of Nemir Kirdar (now made board chairman) from the position and as CEO. The firm also promoted Rishi Kapoor (previously chief financial officer) to co-CEO with Mohammed Al-Shroogi; with Tony Robinson assuming Rishi’s previous role.
Afghanistan: An IFN Correspondent Report
Public comments and expert views on the Islamic banking law in Afghanistan
The Islamic banking law in Afghanistan is in parliament for the approval process. A special committee is working on it.
Today's IFN Alerts
MALAYSIA: International Islamic Liquidity Management to conduct Sukuk auction next week
BAHRAIN: Bahrain Bourse invites foreign investors to subscribe to the government’s Sukuk
INDONESIA: Islamic banks in Indonesia unveil a new standard on Islamic repurchase agreements
UAE: Noor Bank’s listed debut Sukuk sets benchmark for others, says head of debt capital markets
SAUDI ARABIA: Arabian Company for Water and Power Development secures Islamic financing for pioneering Saudi industrial gases project
MALAYSIA: IOI Corporation could regain Shariah compliant status with restructuring of debt composition
MALAYSIA: Baitulmal launches Takaful Asnaf Plan
EGYPT: Egyptian Takaful Insurance Company (Non-life) targets US$1.3 million premiums in fiscal year 2015-2016; negotiates bancassurance deal
MALAYSIA: BGSM Management’s rating remains unaffected by recent issuance of Maxis’s Sukuk
MALAYSIA: RAM releases ratings criteria for government-linked financial institutions and systemically important banks
GLOBAL: IFN Asia Forum breaks 1,000-delegate mark yet again – dates for next year confirmed
SAUDI ARABIA: Islamic Corporation for the Development of the Private Sector chief to deliver keynote address at the IFN Saudi Arabia Forum
MALAYSIA: Industry leaders address Islamic finance investment opportunities at IFN Asia Investors Day Forum 2015
SAUDI ARABIA: Saudi British Bank supports IFN Saudi Forum 2015 as lead partner
IFN Issuers Forum 2015
13th September 2015 (Dubai)
IFN Kuwait Forum 2015
5th October 2015 (Kuwait City)
IFN Egypt Forum 2015
27th October 2015 (Cairo)
IFN Turkey Forum 2015
17th November 2015 (Istanbul)
IFN Saudi Arabia Forum 2015
30th November 2015 (Jeddah)
Funds Transfer Pricing
6th - 8th July 2015 (Hong Kong)
Managing Counterparty Credit Risk, Basel III and Recent Regulatory Issues
9th - 10th July 2015 (Hong Kong)
Understanding Islamic Contracts: Structuring & Legal Issues
17th - 19th August 2015 (Dubai)
Islamic Financial Services Act (IFSA) 2013 & Islamic Banking Products
18th & 25th August 2015 (Kuala Lumpur)
Shariah Audit & Governance for Islamic Banking
20th - 21st August 2015 (Kuala Lumpur)
Islamic Finance Qualification
23rd - 25th August 2015 (Dubai)
Advanced Sukuk & Islamic Securitization
24th - 26th August 2015 (Istanbul)
Undertaking Effective Litigation & Recovery in Islamic Finance Facilities
7th - 8th September 2015 (Kuala Lumpur)
Sharia’a Compliance & Audit for Islamic Banks
8th - 9th September 2015 (Dubai)
Funds Transfer Pricing
5th - 7th October 2015 (Kuala Lumpur)
Trading Book Market Risk Management for Financial Institutions
8th - 9th October 2015 (Kuala Lumpur)
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