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Alizz islamic bank launches Tharwa Wealth Management

Alizz islamic bank recently celebrated the launch of the Tharwa Wealth Management Segment. Tharwa offers an array of financial services led by a team of seasoned relationship managers. Tharwa customers benefit from a selection of exclusive privileges including access to special discounts on travel, accommodation, restaurants, entertainment and various VIP services. Furthermore, Tharwa customers can enjoy the privacy of the Tharwa lounges in conducting their banking transactions, as well as the MasterCard World Credit Card. Tharwa customers also have the flexibility to manage their money through the Izdihar sweep savings account, which adheres to the Islamic principle of unrestricted Mudarabah.

Qatari investors focus on #US #property market

Qatari investors are increasingly looking for opportunites in the booming US propery market. Just Real Estate (JRE) has recently launched its new US portfolio, while QInvest announced its US mulitifamily residential-focused real estate fund Magnolia Real Estate Fund. The fund completed its first acquisition of an outstanding asset in Colorado, US. QInvest has been investing in Western Europe, UK and US for the past 5-6 years. JRE recently added two upscale addresses in Miami and New York City to its ever-growing portfolio of luxury developments in Qatar. Qatar, as a country, is becoming a big player in the New York City’s real estate market, with unconfirmed reports showing Qatar Investment Authority ranking the city's ninth-largest commercial property owner.

New Shariah #standards for Islamic financing, banking launched in Dubai

A set of new Shariah standards for Islamic banking and financing have been launched by the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI). The launching ceremony was attended by Islamic finance scholars and specialists from across the region. The recently issued Shariah standards include No.(55) Competitions and Prizes Standard, No.(56) Liability of Investment Manager Standard, No.(57) Gold and its Trading Controls Standard and No.(58) Repurchase Standard. These standards are deemed important Shariah reference for the industry, including legislative bodies, regulatory authorities and financial institutions. They are also important to other professional entities such as law firms, accounting and consultancy firms, universities, academic institutions and research centres.

No big surge in bank #mergers expected in the #GCC

According to analysts, GCC’s banking sector is not expected to see a big surge in mergers and acquisitions. National Bank of Abu Dhabi (NBAD) and First Gulf Bank (FGB) in the UAE recently merged to create the largest bank in the UAE. Masraf Al Rayan, International Bank of Qatar and Barwa Bank are in the due diligence phase of a planned three-way merger that would create the largest Islamic bank in Qatar. Saudi British Bank and Alawwal Bank are discussing a potential merger that would create the third-largest bank in Saudi Arabia. Despite market conditions and numerous rumours, a big surge in mergers is unlikely due to structural impediments. Some countries have only a small number of local banks, which limits competition. This means that profitability has remained solid despite the macroeconomic pressures. Thus, there is no compelling reason for a big number of regional banks to rush into merger deals.

Hogan Lovells advises on the first #Sukuk to be listed on ISE's Global Exchange market

Hogan Lovells has advised Aktif Bank on the first Sukuk ever to be listed on the Global Exchange Market of the Irish Stock Exchange (ISE). The $118million Sukuk was issued under a mudarabah structure with GAP Insaat Yatirim ve D?s Ticaret, a Turkish construction company. While the Irish Stock Exchange has listed Sukuk historically, this is the first Sukuk to be listed on the ISE's Global Exchange Market. The Hogan Lovells team was led by Imran Mufti (Partner, Dubai), with support from Annalisa Feliciani (Counsel, Rome), Ahmet Kalafat (Senior Associate, Dubai) and trainees Marjun Parcasio and Luigi de Angelis. Onur Aksoy from Aktif Bank said this Sukuk represents a milestone for Islamic capital markets originating out of Turkey. He added that Aktif Bank was pleased to work with the Hogan Lovells team, benefitting from their deep understanding of Islamic finance and capital markets.

Islamic Development Bank launches Innovation #Forum to empower youth

The week-long Innovation Forum hosted by the Islamic Development Bank brought together international experts as well as youth to discuss ways to foster an innovation culture. Experts agree that the major challenges of the IDB member countries include cultural barriers, lack of adequate investment in research and development and a low rate of graduates in scientific fields. Dr. Mimics Begivic, innovation specialist at the UNDP Regional Center for Europe and CIS, said that youth unemployment is a stubborn problem faced by countries that has both a direct and indirect cost on governments. Dr. Nabeel Koshak, president of Baha University, said that there remains a gap in funding to support SMEs in the Islamic world. In Saudi Arabia, the last five years have seen a boost in innovation. Dr. Koshak said the major obstacles for Saudi SMEs are the regulations, followed by competing and entering the market.

$453 million in infrastructure projects for Islamic Development Bank members

A total of $453 million worth of infrastructure projects for five member states has been approved by the Islamic Development Bank (IDB). The approval was given ahead of its annual meeting of the Board of Governors on 17-18 May 2017 in Jeddah, Saudi Arabia. IDB also approved three special assistance projects worth $580,000 for Bosnia and Herzegovina, Kenya and Rwanda. The President of IDB, Dr. Bandar Hajjar, underlined the role of infrastructure projects in order to accelerate development activities. He notied that the meeting addressed in detail youth economic empowerment and the significant opportunities created for youth through infrastructure projects.

Islami Bank transfers executive in a move to curb Jamaat's control

Islami Bank Bangladesh has removed the head of its human resource division amid a war between the old guard belonging to Jamaat-e-Islami and newly-appointed executives. The removed executive, Md Mahboob Alam, is also an executive vice president of the bank. The bank's board of directors took the decision to remove him from the division on Saturday. The new leadership of the bank are fighting for control of the bank with Jamaat supporters after taking charge five months ago. Vice-Chairman Professor Syed Ahsanul Alam Parvez said Mahboob was removed from the human resource division because he was appointing Jamaat loyalists to top posts of the bank. Another director, Professor Dr Qazi Shahidul said that Jamaat supporters were conspiring in various ways because they plan to take back control of the bank after changes through the next election.

‘Islamic finance is not religious, but ethical business’

Professor Binta Tijani Jibril is the Director of International Institute of Islamic Banking and Finance, Bayero University, Kano State. In this article she talks about Islamic finance and its role in Nigeria. She believes that Islamic findance will help Nigerians in general in the sense that it will increase financial inclusion. The main challenge in Nigeria is how to educate the people to create awareness of this financial model. Bayero University has now short training programs, a masters degree in Islamic finance and very soon a doctorate programme we will start. There is also a special programme for journalists. According to Professor Jibril, Nigeria may soon raise sukuk, just like Osun state has done. It’s going to be about providing for infrastructure development as well as empowering the citizens. So Nigeria would be expanding and widening its reach into Islamic finance.

Green #sukuk an option for #sustainability

The government of #Indonesia recently offered retail sukuk to the public to raise funds to help plug a gap in the state budget. From 2008 to 2017, the Indonesian government issued retail sukuk to tap into the country's growing middle class. In 2017, Indonesian retail sukuk became the highest sukuk issuance in the world, with a total value of Rp 31.5 billion (US $2.37 million). Despite its success, the total value of retail sukuk, corporate sukuk and conventional bonds is still considered small compared to the amount needed to finance priority infrastructure development projects. With the lack of a government budget, specified portfolios need to be explored. Green sukuk is a subset of sukuk that finances green assets. As green projects are relatively new in Indonesia, they need time to set up and engage with the nation's development plans.

$100m fund launched in #Bahrain to help #SMEs growth

A $100 million fund has been launched in Bahrain to invest in the country's small and medium-sized enterprises (SMEs). The initiative has been unveiled by the Islamic Corporation for the Development of the Private Sector (ICD) in partnership with Ibdar Bank and Labour Fund Tamkeen. The Bahrain SME Fund is a Shariah compliant mezzanine private equity fund which will target SMEs with high growth potential in consumer, industrial, ICT, education and healthcare sectors. Khalid Al Aboudi, CEO of the ICD, said that SME support is at the centre of ICD’s strategy as they seek to facilitate further prosperity in Islamic countries. Ahmed Al-Rayes, CIO of Ibdar Bank, added that the creation of this fund is aligned with the Bank’s mission to support Bahrain’s economic diversification through private sector growth.

#UAE’s Dana Gas begins refinancing talks on $700 mln #sukuk

United Arab Emirates' energy producer Dana Gas has started refinancing discussions with the holders of its $700 million sukuk maturing in October 2017. The company has faced a cash shortage in the last period and is now planning to restructure its dollar sukuk which was issued in May 2013. Dana Gas CEO Patrick Allman-Ward refused to comment. The energy producer in April repaid an outstanding $60 million loan for its Zora gas field project in the UAE to avoid a breach on the facility. Dana is owed receivables of about $1 billion from Egypt and the Kurdistan Regional Government. Its cash balance as of the end of March was $298 million, slightly below $302 million as of the end of last year. To focus on cash preservation, the company reduced its operational and capital spending in the first quarter.

#Tax provisions related to Islamic finance transactions

The Central Bank of #Oman and the Capital Market Authority allow Islamic financial institutions to follow the standards issued by the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI). AAIOFI’s financial accounting standards differ from International Financial Reporting Standards (IFRS). The differences between AAOIFI and IFRS standards have necessitated specific tax provisions for Islamic Finance Transactions (IFTs). To achieve this, a new chapter has been inserted in the income tax law of 2009. The chapter provides a framework to determine the tax liabilities of parties to an IFT. According to the new tax chapter, income includes any sum received in lieu of interest. The tax provisions also clarify that any partnerships designed solely to comply with Sharia will be disregarded. The latest tax law states that the financial statements can be prepared based on IFRS or any other similar standards approved by the Secretary General of Taxation (SGT). Institutions who have prepared their financial statements based on AAOIFI standards will have to reconcile their tax returns with the SGT.

#Tunisia starts preparatory work for debut #sukuk issuance

The government of Tunisia is preparing its first ever issuance of a sukuk with the Tunisian stock exchange, Bourse de Tunis and Nasdaq Dubai. Preparation work will consider commercial, legal and regulatory issues, including sharia-compliance aspects. This January finance minister Lamia Zribi said that Tunisia needs about $2.85 billion in external funding in 2017 and plans to issue a sukuk of $500 million to cover its budget deficit. Then in February the North African country issued a €850 million bond with a seven-year maturity.

#Fintech for Islamic finance faces standardisation challenges

Fintech has become a buzzword in the Islamic finance industry. Fintech has the potential to play a major role, primarily to improve processes and cost effectiveness while maintaining Sharia compliance. The need for more agile and simpler financial services, the growing usage of mobile devices and the shift towards technological and mobile financial services could underpin growth in the industry. However, there are also challenges. The principal challenge could be the regulatory environment. Regulatory limitations and concerns could hinder the ability of Islamic finance institutions to forge ahead. Fintech has its own cost and integration requirements to consider as well. This could push fintech to the backburner, which in time could turn into a significant hindrance to growth. Regulators and institutions have a significant challenge ahead in balancing the use of new technology to provide better services while controlling new operational risks.

Yes, #China is investing globally—but not so much in its belt and road initiative

China has become a major financier to the world. Last year its outward direct investment (ODI) totaled $170 billion and the overseas lending from its two policy banks added another $100 billion. One aspect of the overseas financing is China’s "One Belt, One Road" (OBOR) initiative. This is President Xi Jinping’s idea of supporting infrastructure development in countries west and south of China. Beijing is hosting a belt-and-road summit on May 14 and 15, which 28 heads of state will attend. There are two main types of capital outflow that are relevant for OBOR: ODI, and lending by China’s policy banks, China Development Bank (CDB) and the Export-Import Bank of China (EXIM). The top 10 destinations of ODI were: the Cayman Islands, the Virgin Islands, the United States, Singapore, Australia, the Netherlands, the United Kingdom, Russia, Canada, and Indonesia. Of these, only Russia and Indonesia are along the belt and road. China is a very significant funder of infrastructure in the developing world, but it is happening everywhere, not just along the belt and road.

Firm Financing and #Growth in the #Arab Region

This paper provides a first analysis of the extent to which firms in the Arab region use capital markets to obtain financing and grow. It addresses two questions: First, how many and which firms issue equity, bonds, and syndicated loans in the Arab region? Second, how do these firms perform relative to non-issuing firms? Two main findings emerge from the analysis. Over the last two decades, the amounts raised in equity, bond, and syndicated loan markets have considerably increased. The typical issuing firm is larger, grows faster, is more leveraged, and holds more long-term debt relative to the typical non-issuer. The firm size distribution of issuers lies to the right and shifts more rightwards over time, indicating a divergence in firm size among listed firms.

Gulf Islamic Investments expands #investments into lucrative transportation and logistic

Gulf Islamic Investments (GII) successfully completed a Shari’ah compliant growth capital financing round for transportation company Bion Group. The UAE-based Group provides both heavy haul transportation services and the manufacturing of heavy transport equipment. Pankaj Gupta, Co-Founder and Co-CEO of Gulf Islamic Investments, said this partnership was an excellent opportunity for Bion Group to take advantage of the uptrends in the ever-increasing construction sector. Noas Al Rawi, CEO of Bion Group, said that with GII's assistance Bion will improve its services portfolio and increase production capacity. He added that Bion will target the refrigerated transportation sector and further consolidate its position in the country’s construction sector.

QInvest and GCC investor launch “Magnolia Fund” to invest in #US #residential #market

#Qatar's QInvest announced its collaboration with a GCC institutional investor to create the Magnolia Real Estate Fund. The fund has already completed its first acquisition of an asset in Colorado, USA. The acquisition was funded using an Ijarah property debt structure. The Magnolia Fund is focused on investing in the fast-growing, income-generating multifamily residential market in the US. The Fund is building a portfolio of assets in the sector and plans to make more acquisitions during 2017. The newly acquired asset is located in Fox Creek, Thornton, a northern suburb of Denver, Colorado. The asset is projected to yield net cash in excess of eight per cent on annual basis and a net IRR in the range of 12-13%. The multifamily manager TruAmerica has co-invested in the asset and will oversee the day-to-day operations of the property.

Dubai repays $600m #sukuk certificates

The Government of Dubai has announced that the $600 million (Dh2.2 billion) Sukuk Trust Certificates issued on May 2, 2012 reached maturity on May 2, 2017. Upon maturity, all the certificates were redeemed in full along with the accrued profit. According to Abdul Rahman Saleh Al Saleh, Director-General of the Department of Finance, this settlement reaffirms the government’s commitment to deal with its repayment obligations in a proactive manner. It also strengthens the government’s resolve to honour all its financial obligations on time.

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