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Dana Gas gets wide support from creditors for #sukuk restructuring

UAE energy producer Dana Gas announced that a large majority of holders of its outstanding $700 million sukuk had consented to a proposed restructuring of the notes. The company, which last year refused to repay creditors, reached last month a restructuring agreement after a long and complex legal battle. Following the launch of a tender and exchange offer on May 22, 93.69% of the holders approved the terms of the proposed restructuring, exceeding the minimum required 75% approval threshold.

ESG podcast: Securities Commission #Malaysia outlines plans for green Islamic finance (part 2)

In this podcast Zainal Izlan Zainal Abidin of Securities Commission Malaysia speaks about the country's strategy for socially responsible and sharia-compliant investing. He talks about the challenges in making Malaysia a global Islamic finance centre. He sees great potential for Malaysia as it rolls out new products, such as a sukuk ETF. Zainal believes the gradual harmonizing of Sharia definitions will fuel more cross-border transactions between Malaysia and the Middle East.

#Australia should consider Islamic finance to bridge infrastructure gap

According to Crescent Wealth managing director Talal Yassine, Australia should consider Islamic finance to bridge its infrastructure gap. In his opinion, if super funds continue to spurn local infrastructure investment in favour of offshore assets, Islamic finance could provide a solution. Australians who think it may be hard to source Islamic debt need only look at the UK, which in 2014 became the first Western country to issue sukuk. Yassine believes that the Australian Government is equally well placed to issue sukuks. Local financial institutions, such as National Australia Bank and Crescent Wealth have expertise in building compliant Islamic debt structures and could be used in these funding initiatives.

We can’t wait for Islamic Banking - bankers

In #Uganda more than half of the 24 licensed conventional banks have expressed interest in providing Islamic banking products. The latest to show interest is EXIM Bank. Raj Banerjee, the deputy chief executive of EXIM bank, said they cannot wait to offer this service to their wide range of customers. At the moment they are going about installing the software and assembling a team that will be directly involved offering the Islamic Banking. Mr Banerjee believes this will be good for everybody. The bank is preparing to launch its Sharia compliant products as soon as the proposals are approved by the Bank of Uganda.

INTERVIEW-How can new crowdfunder GlobalSadaqah improve transparency, impact of Islamic social finance?

In this interview Umar Munshi, the founder and CEO of Ethis Ventures talks about the Islamic crowdfunding sector. Ethis Ventures is a pioneer in the sector centred in Southeast Asia, in Singapore, as well as in Malaysia and Indonesia. Ethis Ventures is behind Ethis Crowd, the first Islamic real estate crowdfunding platform that raises funds for social housing development projects in Indonesia. Ethis is also behind Kapital Boost, which crowdfunds financing for small and medium-sized enterprises. The company’s latest project is a charity-based crowdfunding platform called GlobalSadaqah. It aims to match high-impact charity campaigns to donors who give either zakat or sadaqah.

Decentralized Islamic Bank Hada DBank Lands First Corporate Client

Hada DBank has landed its first corporate client in the shape of Uberstate. As part of the deal Uberstate will purchase $1 million worth of HADA tokens. Both the startups will look to support each other to make a sustainable crypto-economy possible. UberState is a platform for real estate investment and development by providing an opportunity for fractional ownership of big assets. Most of the value of the native token is backed by real estate assets and the token can be exchanged for goods and services around the world. Uberstate themselves are going to launch their token sale. Hada DBank CEO Hisyam M. believes that to have two blockchain-based projects working together is the true meaning of blockchain economy.

Regulations are hindering growth of Islamic finance

The steady growth in Islamic banking in Kenya was unexpected when Islamic finance started in Kenya in the last decade. The Finance Act of 2017 made amendments to the Co-operative Societies Act to facilitate shariah compliant products and enhance financial deepening. It also amended the Public Finance Management Act to recognise Sukuk as one of the national government securities. Despite this growth, there is still much to be done in developing regulations. Kenyan Islamic banks have tried to embed shariah governance within their governance frameworks. However, the mechanism lacks to ensure parity in shariah interpretations, product development and advisory and regulations at an industry level. Islamic capital markets remain hugely untapped in Kenya.

The evolving landscape of Islamic finance: regulatory developments

The Securities and Exchange Commission of Pakistan (SECP) has taken a number of measures for the effective regulation of Islamic finance in the country. The SECP has constituted a Shariah Advisory Board, consisting of renowned scholars and has established a dedicated Islamic Finance Department (IFD) to embed Islamic finance in the corporate sector and capital markets. New regulations have been issued under the provisions of the Companies Act. The SECP issued Draft Shariah Governance Regulations, 2018, a comprehensive set of regulations for governance of Shariah-compliant companies, Shariah-compliant securities and Islamic financial institutions. In order to encourage Sukuk issuances, the Sukuk Regulations, 2017, have been notified, and tax neutrality has been provided through an amendment to the Income Tax Ordinance. In February 2018, the SECP adopted three AAOIFI Shariah standards while in April 2018, the SECP issued draft notification for adoption of seven more AAOIFI Shariah Standards.

ABL asset management launches ABL Islamic asset allocation #fund

ABL Asset Management has launched the ABL Islamic Asset Allocation Fund (ABLIAAF), an open-end Shariah Compliant Asset Allocation Scheme. The fund is now open for subscription. ABL Islamic Asset Allocation Fund will operate under the guidelines of Al-Hilal Shariah Advisors Private Limited. The Shariah Supervisory Counsel is headed by Mufti Irshad Ahmad Aijaz, who is a renowned Shariah Scholar. ABLIAAF will invest in Shariah Compliant Equity, Fixed Income, Money Market Instruments and other permitted instruments. ABL Asset Management CEO Alee Khalid Ghaznavi said with this launch the company further expanded its offerings including Income Funds, Money Market Funds, Stock Funds, Fund of Funds, Asset allocation schemes and Pension Funds in both Islamic and Conventional manner.

#Kuwait Bank Adopts Ripple for Instant Cross-Border Payments

The Kuwait Finance House (KFH) has joined RippleNet, an enterprise blockchain network for international remittance payments. RippleNet is a SWIFT-replacement global blockchain network that sees over 100 financial institutions including banks, payment providers and remittance operators. KFH underlined its intention to use Ripple’s unique tool for cross-border payments for its retail customers. With this, KFH can provide instant and secure cross-border money transfers within seconds, with end-to-end visibility over the journey of the payment. Elsewhere in the region, UAE-based RAK Bank became a RippleNet member in September. The Saudi Arabian Monetary Authority (SAMA), the defacto central bank of Saudi Arabia, has also partnered with Ripple. The SAMA also became the first central bank in the world to join RippleNet.

#Sukuk issuance growth to remain 'unspectacular' on structural constraints, Fitch says

According to Fitch Ratings, the moderate growth in sukuk issuances in the first quarter underpins continued investor interest, but it also points out to structural constraints. The total volume of sukuk rated by Fitch for the three-month period through to March end, stood at $80 billion (Dh294bn), a 6% rise from the figures recorded at the end of 2017. New sukuk issuance with a maturity of more than 18 months from the Arabian Gulf states, Malaysia, Indonesia, Turkey and Pakistan came in at $14.9bn for the first quarter of 2018, a modest 1% year-on-year rise. The issuances during the first quarter of 2018 were largely driven by the GCC region, whose funding needs are likely to fall if oil prices stay high. Issuer funding needs and investor appetite for the remainder of the year will be determined by factors including oil prices and tighter global financing conditions.

Group roots for deepening of Islamic finance

In #Kenya a lobby group has called for the review of regulations governing Islamic banking and Sharia'h compliant products offered by conventional banks so as to resolve the issue of interest rates. The group, Bayt-ul-Maal has commenced gathering signatures to petition Kenyan Muslims scholars to deliberate and craft a modern day Bayt-ul-Maal (Islamic Treasury) catering for the needs of Muslims. They embarked on a door-to-door campaign sensitizing the Muslim community on the importance of Bayt-ul-Maal. The group claims that since February this year debate has raged concerning the validity of Islamic banking and Sharia'h Compliant windows, as offered by some conventional banks.

Islamic wealth management and its relevance in modern times

The objective of Islamic wealth management is economic justice through equitable distribution of wealth. This by no means restricts private ownership and entrepreneurship but a wider circulation of wealth and invested in socially beneficial economic activity. To serve social justice, wealth is not considered legitimately earned unless the risk-and-rewards are both shared in a financial contract: so one-sided no-risk-sharing contracts are not permitted. Islamic wealth management involves wealth generation, accumulation, preservation, purification and distribution. Creation of wealth is defined more broadly than in conventional practice. A set of filters are applied to financial transactions that ensure permissibility. Impermissible gains are expected to be distributed to the needy as a method of purification or cleansing. The process of cleansing applies in corporate finance and investment as well.

Global #Sukuk issuances surges 44 per cent in Q1

According to the latest statistics by RAM Ratings, a total of $12 billion worth of Sukuk was issued in March 2018, bringing global Sukuk issuance to $30 billion in Q1 2018, a 44.4% surge from $20.8 billion for the same period last year. The increase is likely due to a boost from Saudi Arabia with issuance reaching $6.5 billion as at end-March 2018. Malaysia had issuances rising from $9.6 billion to $11.5 billion, accounting for the second-largest year-on-year increase, followed closely by Indonesia at $5.5 billion, the UAE at $3.3 billion and Turkey at $1.4 billion. Malaysia retained the top spot in terms of global Sukuk issuance with a 38.2% market share worth $11.5 billion as at end-March 2018. Saudi Arabia stayed in second place with a 21.7% share worth $6.5 billion, Indonesia closed on third place with 18.2% and the UAE with 10.8%.

Dana Gas receives $40mn from #Egyptian government

UAE based natural gas producer Dana Gas has now received almost $90mn so far this year from the North African nation.

#Saudi Arabia's #Sukuk selling crosses SAR 3.95 bn

Saudi Arabia's finance ministry sold 3.95 billion riyals (USD1.05 billion) of domestic Sukuk in its monthly sale by re-opening an issue originally made last month. It sold 3.35 billion riyals of five-year Sukuk, 350 million riyals of seven-year and 250 million riyals of 10-year. Last month, the ministry sold 5.0 billion riyals of domestic Sukuk.

Call for promoting role of Islamic Waqf

Qatar's Ministry of Awqaf and Islamic Affairs organized a forum on waqf where participants called for the advancement of the waqf to regain its role in the Islamic economy. Qatar has made great steps in the advancement of the waqf, starting with the enactment of the laws regulating it, and taking all measures to ensure the governance and transparency of waqf operations. The four-day forum discussed current vital issues including the responsibility of scholars, the renewal of Islamic jurisprudence, the reform of religious education, and the Islamic waqf and its role in development.

Noor Financial sells $16 million stake in Meezan Bank

Kuwait-based Noor Financial Investment Company (NFIC) has sold its stake in the Pakistani Meezan Bank Limited (MEBL), which is worth $16.014 million. A total of 2.49% of the total issued and paid up capital of the bank was sold and shares have been acquired by various foreign institutional investors at purchase price of Rs70 per share. Meezan Bank is planning to raise up to Rs7 billion by issuing Tier 1 Sukuk in the coming few months to shore up its capital adequacy ratio. According to the bank’s annual report for 2017 the capital adequacy ratio of Meezan Bank was at 12.89% last year, whereas its total assets grew 19% to reach Rs781 billion in December 2017, compared to Rs658 billion in 2016.

Muslims demand Islamic banking

The Muslim community of Uganda asked the Government to speed up the process of providing regulations for Islamic banking. According to Speaker of Parliament, Rebecca Kadaga, the laws for Islamic banking have been passed but Bank of Uganda is reluctant to draft the regulations as well as issuing licenses for Islamic banking. Financial experts have often criticised Islamic banking for higher creating costs and bigger risks, a situation that has not been remedied over the years. The lack of unique frameworks by the Government to regulate Islamic banking is the other challenge, leaving the Islamic banks to be regulated as other conventional banks.

#Uzbekistan set to develop Islamic banking system

Uzbekistan is joining the rising number of Central Asian nations to develop a Shariah-compliant banking system given its large Muslim population. This month, the Uzbek government issued a draft resolution to create infrastructure for Islamic banking and finance in the country. The aim is to create alternative financing opportunities in the former Soviet republic and open the doors for Islamic investors from the Middle East and Southeast Asia. To that end, the central bank has been tasked with developing a legal and regulatory framework not just for Islamic banking, but also for Takaful and securities trading, as well as financing for small and medium enterprises and Halal microfinance. The framework will include the launch of the Islamic Development Bank of Uzbekistan (IDBU), which will provide standard retail banking services, trade financing, property and commercial real estate financing, as well as leasing, Takaful and securities services.

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