Africa

Islamic finance contracts estimated to reach $2.5trn

The Qatar International Center for Conciliation and Arbitration (QICCA) has participated in the 7th East Africa International Arbitration Conference (EAIAC) held on 29 - 30 August 2019 in Nairobi. As QICCA’s Board Member, Sheikh Thani bin Ali bin Saud Al Thani attended the event and delivered a research paper on Islamic finance. During the sessions of the conference, Sheikh Thani informed attendees on the expertise of Qatar in Islamic finance as well as Malaysia’s experiment, in addition to experiments of non-Islamic countries such as Singapore. The conference which was held under the theme "Government Contracting and Investment Disputes: Lessons for States and Investors" saw a participation of more than 250 attendees from Kenya, Uganda, Tanzania, Burundi, Rwanda and Ghana. QICCA General Counsel Minas Khatchadourian said that the world’s Sovereign Wealth Investments will reach $15trillion by 2020, which represents 25% of the total value of assets that are managed over the world.

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https://www.thepeninsulaqatar.com/article/08/09/2019/Islamic-finance-contracts-estimated-to-reach-$2.5trn

Islamic finance taking shape

In #Ethiopia, Muslim members of the business community are and had been severely underserved by the nation’s financial industry. This seemed to be changing in 2011 with the enactment of the nation’s first interest-free banking directive by the National Bank of Ethiopia. However, the directive only authorized interest-free banking window in the setup of a conventional banking system and not a full-fledged Islamic bank. Exactly six years later, three potential full-fledged Islamic banks have been established. The three have officially started selling shares while unofficially at least two more banks are said to be in the pipeline to take part in the interest-free banking game. This will bring the total number of new entrants to five.

Use arbitration to solve Islamic finance disputes

With the growing number of the Islamic financial service providers in Kenya, a proportionate increase in Shariah-related commercial and financial disputes is also expected. In Kenya there is no comprehensive legal and regulatory framework that governs the application of Shariah principles. Arbitration as a form of Alternative Dispute Resolution (ADR) mechanism is gaining in popularity owing to the time and cost it takes to resolve disputes. The disputing parties can select the arbiters and the proceedings can be held in private away from the media glare and therefore does not damage reputations and destroy brands. Islamic financial providers need to ensure that arbitration clauses are factored in their contractual documentations to take care of the need to seek sound Shariah determination of commercial disputes.

Jaiz bank grows half-year profits by 295%

#Nigeria's Jaiz Bank has recorded an impressive performance in the first half of this year. Gross earnings rose by 41% while pre and post-tax profits increased by 292% and 295% respectively. The half year report indicated that Profit Before Tax increased to N907 million from N231 million, while Net Profit after tax rose to N816 million from N207 million. The bank also grew its total income by 41% from N4.47 billion as at June 2018 to N6.31 billion at June 30th 2019. The balance sheet was further strengthened during the period with Total Assets rising by 33% from previous year end position of N108.46 billion to N144 billion. The above results further consolidated the growth trajectory of Jaiz Bank with a promise to end the year positively.

Gulf African Bank inks IFC advisory deal for SME lending

The International Finance Corporation (IFC) is offering technical advisory services to Gulf African Bank to help it lend more to small and women-owned enterprises. The advisory will cost $368,016 (Sh37 million) and is the latest such undertaking with local banks. Other banks that have signed similar deals include Co-op Bank and Equity Bank. IFC says the project will focus on competency assessment, opportunity sizing and product programme development for SME banking. The institution defines SMEs using various measures including firms having between 10 and 300 employees or annual sales of Sh10 million to Sh1.5 billion. The loan size per borrower usually ranges from Sh1 million to Sh200 million.

Experts meet on Islamic finance

Experts from the private and public sectors are meeting today in Lagos to discuss the progress of Islamic finance in Nigeria. The inaugural edition of the IFN Nigeria Forum "Harnessing the Islamic Finance Sector for Infrastructure Development and Economic Growth" takes place on June 18th. The IFN Nigeria Forum 2019 features a mix of panel sessions, onstage interviews and interactive sessions on a number of themes in Islamic finance, including Corporate Financing and Capital Raising in Nigeria. Speakers include Director-General, Debt Management Office of Nigeria, Ms Patience Oniha; Acting Director-General, National Pension Commission, Hajia Aisha Dahir-Umar; Divisional Head, Trading Business, NSE, Mr Jude Chiemeka; Managing Director, Lotus Capital, Hajara Adeola; Partner, Udo Udoma & Belo Osagie, Adeola Sunmola, and Head, Debt Capital Markets, FBNQuest Merchant Bank, Oluseun Olatidoye.

Islamic Banking already in #Uganda, says Kasaija

According to the Minister of Finance, Mr Matia Kasaija, no amount of opposition will stop the operationalisation of Islamic Banking in Uganda because it has already kicked off. He is the one who signed the instruments operationalising it and he said Ugandans should stop associating it with terrorism and Islamic fundamentalism. During their annual general meeting last Saturday the Uganda Joint Christian Council (UJCC) resolved to lobby against the implementation of Islamic Banking. The Christian bishops speculated that Muslims could be using Islamic Banking as a bait to lure Christians into Islam. This drew a backlash from Muslim leaders, who warned the bishops to refrain from mobilising against Islamic Banking and advised them to seek knowledge from Ministry of Finance or Bank of Uganda rather than undermining it through the media.

#Nigeria Should Develop Policies To Enhance Islamic Estate Planning – Awojobi

In this interview FBNQuest Trustees managing director Kunle Awojobi speaks about the benefits of Islamic Estate Planning. Islamic Estate Planning is considered an act of purifying or cleansing the individual, which involves voluntary and compulsory distributions made after death. Islamic Estate Planning is a relatively new area in Islamic Finance in Nigeria. In 2017, FBNQuest Trustees began educating Muslims through its flagship programme the Legacy Series, both on radio and in press. They also established partnerships with key players in the Islamic Finance space. FBNQuest Trustees helps with the management of Islamic Wills, but also other instruments like Zakat, Wakaf, Hibah, etc.

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.

Experts Urge Nigerians to Embrace Islamic Estate Planning

At the Islamic Estate Clinic held on April 28, 2019 in Abuja, different speakers highlighted how Nigerians, both Muslims and non-Muslims can benefit from the Islamic Estate Planning system. The event was put together by FBNQuest Trustees, with Managing Director, Adekunle Awojobi, hosting it. The clinic featured sessions facilitated by Dr. Bashir Umar, a renowned Islamic Financial Scholar. The sessions covered Waqaf, Wasiyyah, Zakat, Hibah and Takaful, among other asset preservation and wealth transfer principles. FBNQuest Trustees said it remains committed to pioneering critical conversations such as this and helping Nigerians make sense of assets accrued in the course of their lives, without compromising their faith or values.

FBNQuest Trustees to Host Islamic Estate Planning Clinic

FBNQuest Trustees is set to host an Islamic Estate Planning Clinic, on the 28th of April, 2019 in Abuja, Nigeria. This forum aims to educate Muslims about the importance of Estate Planning in line with Islamic laws. The Islamic Estate Planning Clinic will be hosted by Mr. Adekunle Awojobi, Managing Director FBNQuest Trustees and facilitated by the renowned Islamic financial Scholar, Dr. Bashir Umar, Imam at Al- Furqan Mosque in Kano. The session will address topics on Islamic Trust (Waqaf), Islamic Will (Wasiyyah), Zakat, Hibah, Takaful, and Sukuk; underscoring the importance of an Islamic plan to Muslims, as highlighted from the Qur’an and its interpretations in the Sunnah and Hadith. FBNQuest Trustees will also share insights on managing conventional Estate Plans, which is targeted at ensuring the preservation of legacies.

Will Global Fintech top guns help #Nigeria achieve 80% Financial Inclusion ?

Nigerian Fintech company Paystack has received an investment of $8 Million from Stripe, Visa, Y Combinator and Tencent. Over the last three years, Fintechs in the country have received funding, and that has increased steadily. Including Flutterwave’s $10 Million there was roughly $100 Million deployed into Fintechs. SureRemit, another Fintech raised $7 Million in an ICO this year. Over the last couple of years, more Nigerian Fintechs are being chosen for Y Combinator. All this activity and traction is also suitably backed by ecosystem players, policy makers and regulators. The rationale behind the investment from the Visa, Stripe and Tencent into Paystack is to help their expansion within Nigeria and to bring financial services to people who have so far been denied the opportunity.

Financing deals push Gulf earnings to Sh212m

Gulf African Bank's net profit increased to Sh212.42 million from Sh191.60 million in the first half of 2018. It is a 10.86% growth after fees on financing deals quadrupled. Fees and commissions on financing arrangements surged 309.72% to Sh122.89 million from Sh29.99 million. Net profit income rose 7.46% to Sh1.01 billion after the value of the arrangements to customers jumped by a third year-on-year to Sh21.42 billion in June and 7.42% from last December.

Jaiz to commence disbursement of $20m SMEs #fund

The Managing Director of Jaiz Bank Hassan Usman has said the bank would soon begin the disbursement of the $20m facility for Small and Medium Enterprises (SMEs). The bank had in March signed the agreement with the Islamic Corporation for the Development of Private Sector to finance SMEs with $20m (N6.1bn). Usman said the bank would soon begin the disbursement, adding that the fund would be disbursed before the end of the year. He said the bank had commenced a five year strategic plan to provide better services to its customers. For example, the bank had increased its visibility in Lagos by opening more branches and plans to extend to other regions of the country as well.

Sigma Pensions’ Sharia funds to drive private equity investments

Sigma Pensions has commenced plans to boost investments in private equity through Sharia Funds. Chairman Mark Collier stated this in a conference hosted by the firm recently in Lagos. According to Collier, there is huge interest in Sharia Funds, and Sigma is interested in providing greater choices for its investors and contributors. Sigma CEO David Uduanu said it was vital to discuss ways to increase the penetration of pension funds in private equity. He said Sigma Pensions has started a conversation between the pension funds and the private equity industry that would lead to more investments of pension funds in private equity and more investment of private equities in Nigerian SME’s.

Enact legislation tailored to Islamic finance sector, CBK urged

The Central Bank of Kenya (CBK) is asked to enact a sector-specific legislation tailored to Islamic finance sector to monitor and regulate transactions. According to Jacqueline Wangui, Partner at MMC Africa Law, the absence of specific legislation on Islamic finance is in itself a hindrance to the realization of the financial benefits. Wangui proposed that embedding a Shariah council within the structure of the CBK could go a long way. The Sharia council would constitute of local and international Islamic scholars to sit in an advisory capacity with the aim of producing a congruent regulatory framework for Islamic financing. Currently, there is no overall regulator at the level of the CBK appointed to specifically oversee the management of Islamic financing and its products.

La Société internationale islamique de financement du commerce fait le point de son portefeuille au #Cameroun

La Société internationale islamique de financement du commerce du Groupe de la Banque islamique de développement (BID) est satisfaite de sa coopération avec le Cameroun. Aliou Barki Kane et le ministre camerounais en charge de l’Economie, Alamine Ousmane Mey ont passé en revue le portefeuille de coopération avec la BID. Aliou Barki Kane a déclaré que 560 millions de dollars ont été tous décaissés, remboursés et les bénéfices ont été mesurés à travers les intrants agricoles et également la commercialisation du coton à travers la Sodecoton. Barki Kane a ajouté que la coopération avec le Cameroun a été fructueuse et les fonds ont été mis à la disposition des bénéficiaires finaux.

Why we rejected N21.5bn #Sukuk bond – #Niger speaker

Speaker of the Niger State House of Assembly, Alhaji Ahmed Marafa Guni, has explained why the house rejected to access N21.5 billon Sukuk bond for infrastructure development. He said the house discovered a lot of discrepancies in the bond deal and, therefore, decided to send it back to the Executive. He added there were hidden costs in the loan which would tie down the state for several years. The speaker said the sukuk request could still be re-presented if those discrepancies are addressed. The government said it had asked the assembly to stay action on the request because of insinuations that the money was meant for the 2019 general election campaign.

Banks want 'costly' Islamic banking regulations adjusted

Banks in Uganda have petitioned the central bank to review key regulations in Islamic banking to make it less costly for the banks. According to Patrick Mweheire, the chairman of Uganda Bankers' Association (UBA), the current regulation requires that a commercial bank that applies to offer Islamic banking must have its own sharia panel comprising nine muftis. Mweheire suggested that UBA should instead have one panel which can be used by all its members when advancing Islamic banking products to the public. UBA CEO Wilbrod Owor said there were a lot of issues in the sector that affect them and need their attention: money laundering, terrorism finance, and digital technologies etc.

Why Islamic finance is yet to realise its full potential in #Kenya

Kenya's Islamic finance industry is over a decade old but is yet to realize its full potential. The uptake of Shariah compliant financial products has been adversely affected by the absence of supportive legal and regulatory infrastructure, lack of skilled Islamic finance professionals, poor perception and lack of awareness. One other challenge is the lack of harmonisation of the Shariah standards. Industry stakeholders need to undertake a comprehensive training of the Shariah scholars and enhance public awareness in Islamic finance. Aqeel Consulting takes the initiative to organise a technical workshop for the Shariah scholars between July 11 -12, 2018 at the Windsor Golf Hotel and Country Club.

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