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VCBank buys majority stake in Caribou and Fuddruckers

Bahrain's Venture Capital Bank (VCBank) announced its acquisition of a significant stake in the Caribou Coffee and Fuddruckers Restaurant franchises in Bahrain. From its first outlet in Bahrain in 2007, Caribou has grown its network to 22 stores, and is ranked among the top three international coffee shop chains operating in the kingdom.

Medina Islamic Finance Boost Financial #Inclusion in Africa

Medina Islamic Finance, an Africa-focused digital Islamic microfinance platform has announced a strategic partnership with United Labs, a New York-based data science venture studio. The announcement was made by the founder and CEO of Medina Islamic Finance, M. Wagane Diouf, at the 44th Annual Meeting of the Islamic Development Bank Group. United Labs will initially provide Medina Islamic Finance with access to Artificial Intelligence technology and automated local language customer support systems that will accelerate Medina’s underwriting while improving customer support. United Labs CEO Bachir Diagne said he was proud to support Medina's inclusive ecosystem with data science technology solutions and to boost financial inclusion in Africa. Medina Islamic Finance plans to roll out its suite of ethical banking solutions in key targeted African countries in partnership with established financial institutions later this year.

BML launches complete range of Shariah-compliant business financing products

Bank of Maldives (BML) Islamic launched a range of Shariah-compliant financing products. BML Islamic Retailers’ Financing allows businesses with average monthly sales of MVR 50,000 to finance up to three times the monthly sales volume, and a repayment period of 48-months for financing facilities and 12-months for Wakala based overdraft facilities. Additional security is not required for financing up to MVR 500,000. BML Islamic Business Development Financing offers flexible collateral requirements for working capital, refurbishment, property development or to buy new machinery. BML’s Deputy CEO Mohamed Shareef stated that the new products show the Bank’s commitment to the growth of Small and Medium Enterprises in the country.

Islamic Finance Centre opens in #Kazakhstan

Qatar's Hamad Bin Khalifa University (HBKU), Al-Farabi Kazakh National University, and Astana International Financial Centre (AIFC) have opened an Islamic Finance Centre (IFC) in Kazakhstan. The opening ceremony was attended by HBKU president Dr Ahmad M Hasnah, along with the rector of Al-Farabi University, Dr Galym Mutanov, and AIFC board vice chairman Yernur Rysmagambetov. The IFC is equipped with the most advanced technological tools offering training programmes with the aim of becoming a research hub and educational cluster in Islamic finance. HBKU's College of Islamic Studies (CIS) will support this centre and the two institutions will be working on student exchange programmes, joint conferences, and mutual research projects.

GCC Banking Sector to Witness Mergers Worth Nearly $1 Trillion

The GCC banking sector is undergoing major consolidation phase with 20 banks negotiating mergers and acquisitions with an estimated $1 trillion worth of assets. The UAE leads the pack with highest number of mergers both in terms of value and volume. Currently, six mergers and acquisitions are being negotiated or underway in the UAE banking worth sector worth $625.25 billion followed by two M&As in Saudi Arabia worth $256 billion and one each in Kuwait and Oman. According to Moody's Investors Service, the recent merger and acquisition drive will help the sector by easing overcapacity and boosting profitability. Moody's Senior Analyst Ashraf Madani says that slow growth and subdued credit demand in the region are the biggest drivers of consolidation.

Ethis Group Comments on Receipt of Islamic Equity #Crowdfunding License in #Malaysia

The Securities Commission Malaysia revealed updated regulations as well as the approval of 8 new "Regulated Market Operators" serving the investment crowdfunding market. Best known for its impact investing in Indonesia, Ethis Ventures launched last year its Global Sadaqah platform and expects to launch its new Ethis Equity platform in Malaysia in Q1 2020. Ethis Group Chief Investment Advisor Maritz Mansor said they are very excited to have this chance to open up a new asset class to all levels and types of investors. Umar Munshi, Managing Director of Ethis Ventures, said SMEs and startups in Malaysia had few avenues for raising funds. He added that the Shariah-compliant alternative was missing and Ethis Equity aims to fill the gap. In Ethis Equity the minimum investment will be low which means that ordinary people can invest alongside professional investors.

Najib's SRC trial: Interesting use of Islamic banking facilities, inter-posed charitable trusts to break-up cash flows into discrete unconnected packages -evidence can prove problematic for ANZ's Shayne Elliot

Two diagrams published by the Malay Mail illustrate the cash flows relied on by the prosecution to prove the charges against Najib Razak. The diagrams reveal the use of Islamic banking facilities and inter-posed charitable trusts to break-up what can appear to be simple linear flows into discrete seemingly independent packages. These arrangements create problems for many, but especially the ANZ Banking Group whose management oversaw these transactions. ANZ CEO Shayne Elliot continues to distance himself from the problem, claiming that he was not a member of the AMBank board of directors when these transactions were executed, but in fact he was.

SAMA fines 16 financial institutions for violating principles of responsible finance

The Saudi Arabian Monetary Authority (SAMA) has fined 16 financial institutions for violating principles of responsible finance and has instructed them to correct the violations. SAMA stated that the fines were imposed in order to implement principles of justice and transparency without providing details of the fines. The central bank fined some of the Kingdom’s major financial institutions such as Al-Rajhi Bank, Al-Ahli Bank, Saudi Fransi Bank as well as Al-Riyad Bank, Al-Jazira Bank and Dubai-based Emirates NBD Bank. SAMA said that the fines were imposed to ensure fairness and competitiveness of financiers.

At fintech meet, Guan Eng says only Pakatan provides the tolerance needed for innovation to thrive

Malaysia's Finance Minister Lim Guan Eng said the country finally gained the tolerance element needed for digital innovation when Pakatan Harapan (PH) became the federal government. In his speech at the Securities Commission Fintech Roundtable 2019 the minister also cited a 2018 World Bank report that described Malaysia as having produced some of Southeast Asia’s most successful digital startups. He added that the government had also committed RM50 million towards a co-investment fund for ECF and P2P investments. ECF and P2P are two relatively recent developments in Malaysia that have opened up additional avenues of funding for microbusinesses and startups that may not yet qualify for traditional loans from commercial banks.

Alliance Islamic Bank launches social #crowdfunding platform

Alliance Islamic Bank launched its first social crowdfunding platform to create greater socioeconomic impact for the financially disadvantaged. The new platform is named SocioBiz and targets individuals seeking to raise funds to start or expand a business or learn a new life skill to earn a living. Alliance Islamic Bank had signed a memorandum of collaboration with Islamic fintech venture builder, Ethis Ventures Malaysia, and beneficiary partners, Yayasan Kebajikan Negara, Yayasan Noor al-Syakur and Pertubuhan Kebajikan Islam Malaysia. SocioBiz targets to identify and promote at least two recipients each month on the platform. So far SocioBiz has rolled out six campaigns and raised over RM23,000 through its platform.

Turkish banks and investors disagree on bad loan talks

Turkish lenders disagreed on almost everything with potential investors when they met for the first round of talks about unloading a pile of bad loans. Investors demanded a 30% discount on the face value of the loans and an ownership stake, but the Turkish banks refused to write-off the loans and wanted to restructure them instead. While the government plans to carve out non-performing energy and real-estate loans, attendees disagreed so that some of the participants questioned whether there would even be more talks. Bank capital ratios are being squeezed after companies requested about $28 billion of debt-restructurings after a 28% plunge in the lira against the dollar last year.

UNHCR unveils Refugee #Zakat Fund

The United Nations Refugee Agency has launched a new global structure that transforms UNHCR’s existing Zakat programme into a global fund. UNHCR unveiled its 'UNHCR Zakat Program: 2019 Launch Report', which shows that global Zakat giving stands at $76 billion worldwide, and could potentially reach an amount as high as $356 billion. According to Houssam Chahine, UNHCR’s Head of Private Sector Partnerships, it was inevitable for the Zakat program to evolve into a structure that better appeals to the global Islamic finance industry. The Fund allows UNHCR to be even more transparent. The decision to restructure the Zakat program into the global Refugee Zakat Fund is due to the high donor turnout UNHCR has witnessed in the past years.

Goldman Sachs brings forward claim linked to Saudi debt saga

Goldman Sachs has bought forward a claim against Bahrain’s TIBC whose default 10 years ago triggered the biggest financial crisis in Saudi Arabia. The Bahraini lender raised money in international markets, transferring the funds to now defaulted Saudi conglomerate Ahmad Hamad Algosaibi and Brothers (AHAB). After TIBC defaulted on a foreign exchange deal, AHAB collapsed along with another Saudi conglomerate Saad Group, leaving an estimated $22 billion in unpaid debts. TIBC, administered by the Central Bank of Bahrain, has a claim of around $3 billion against AHAB, while more than 60 banks that have lent money to TIBC remain unpaid.

Malaysia leads global sukuk issuance

Malaysia continued to maintain the leadership as the largest issuer of sukuk globally with a total of US$13.9 billion in the first three months of 2019. This means a market share of 35.2% from the overall issuance of US$39.5 billion during the period. This also represented an increase of 54.4% compared with US$9 billion that Malaysia issued in the first quarter of 2018.

The Hajdari Group Unveils Newly Pioneered Sharia-Compliant Investment Strategies Option: 'InvestHalal' Wealth Management for American Muslim Investors

The Hajdari Group recently announced the creation of its newest, faith-based financial planning platform: InvestHalal. InvestHalal utilizes a strict code-of-ethics and series of standards established by prestigious global authorities like the Fiqh Council of North America (FCNA), and the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI). Access to faith-based investment strategies has generally been unavailable in the United States to Islamic investors. President of the Hajdari Group, Zaim Hajdari said the Hajdari Group has finally remedied this oversight. InvestHalal offers asset allocation and investment diversification options, a wide variety of investment alternatives and services structured to individual needs: retirement, education, tax and estate planning, as well as other Sharia-compliant wealth allocation.

Abu Dhabi bank delays instalments on personal financing in Ramadan

Abu Dhabi Islamic Bank (ADIB) revealed it would postpone a monthly instalment for its personal finance customers at no extra charge during the holy month of Ramadan. ADIB annually offers flexible payment to customers during Ramadan to meet their individual needs. Philip King, global head of Retail at ADIB, noted that customers eligible for the Ramadan payment postponement initiative would be informed by SMS, adding that the offer is valid for instalments due between 1 May and 31 May. However, customers are free whether to withdraw or maintain making instalment payments. Throughout the holy month, ADIB hosts Ramadan tents across the UAE that organise Iftars managed by the bank’s employees who have volunteered to be part of the initiative.

Moody’s expects strong growth in the Islamic finance sector in 2019

Moody’s Investor Services expects strong growth in the Islamic finance sector, reflecting the increasing demand for Shari’ah-compliant financial instruments. The rating agency stated that familiarity as well as understanding of the instrument is increasing and there are no barriers to investors, both Islamic and conventional to investing in these issuances. The growth in the Islamic finance sector is expected to translate into stronger prospects for green Sukuk issuance by sovereigns and financial institutions. The green Sukuk market will benefit from the buoyant demand as institutional investors seek to integrate sustainability into their asset allocation and risk management practises.

The #UK can be a world leader in Islamic finance

According to Al Rayan Bank CFO Amir Firdaus, Islamic finance is reinforcing the UK’s position as a global financial hub. London is the leading centre for Islamic finance outside the Muslim world, with assets of UK-based institutions that offer Islamic finance services totalling more than $5bn. More than 20 banks in the UK offer Islamic services, and five of these banks are fully Sharia-compliant, including Al Rayan Bank. Al Rayan currently provides Islamic financial products to more than 85,000 customers in the UK. Last year, Al Rayan became the first bank in the world to issue a public sterling sukuk in a non-Muslim country. The London-listed £250m securitisation was rated AAA by Standard & Poor’s and Aaa by Moody’s Investors Service and was significantly oversubscribed. The appeal of Islamic finance is growing steadily, more than a third of Al Rayan Bank’s customers are currently believed to be non-Muslim.

CBK rejects Warba Bank #merger with KMEFIC

In February, Kuwait’s Warba Bank announced the purchase of Ahli United Bank (AUB) and its subsidiary to acquire their collective 75.7% stake in Kuwait & Middle East Financial Investment Company (KMEFIC).
Warba Bank said that the Central Bank of Kuwait (CBK) has rejected its proposed acquisition of a controlling stake in KMEFIC. According to CBK, Warba Bank's acquisition of AUB’s stake in KMEFIC will not have a significant effect on the financial position of the lender. The purchase agreement came at a time when mergers and acquisitions in the Gulf’s financial sector are rising as lenders attempt to improve their financial standing through consolidation.

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