Zawya

Noor exits $6mln stake in #Pakistan’s Meezan Bank

Noor Financial Investment announced selling 9 million shares or 0.85% of its equity ownership in Meezan Bank, Pakistan's first and largest Islamic bank. The equity transaction is valued at $5.57 million or KWD 1.68 million. Following this exit transaction, Noor currently owns 39.53% equity in Meezan Bank. The financial impact of this transaction will be a profit of KWD 293,000 that will be registered in Noor's income statements of the third quarter of 2018, in addition to an increase of KWD 648,000 in the shareholders' equity rights. In mid-July, Noor announced selling 27.23 million shares or 2.56% of its equity in Meezan Bank at a value of $15.76 million or KWD 4.77 million.

Algosaibi signs grant agreement with Ebdaa Bank

The Algosaibi Holding Group has signed a grant agreement with Ebdaa Bank. This grant of BD100,000 ($263,000) will enhance the bank’s financial solvency and increase its ability to expand borrowers list which currently includes more than 2,500 borrowers. The agreement was signed by Dr Khalid Al Ghazawi, CEO of Ebdaa Bank, and Fawaz Algosaibi, CEO of Algosaibi Holding. As a nonprofit social financing, Ebdaa Bank seeks to help low-income Bahraini make their way to business. Fawaz Algosaibi praised the efforts made by Ebdaa Bank to provide easy financing for low-incomers and for the prudent management practices implemented by the Bank. He expressed his full confidence in the ability of the bank to manage the amount of support and maximize the benefits.

Fitch: #UAE Reforms Aid #Sukuk Market; Implementation Still Key

The UAE's Securities and Commodities Authority (SCA) said that issuers of Islamic securities should improve disclosure. Issuers should specify how transaction resources and revenues would be treated if a security were deemed no longer compatible with the provisions of sharia. Issuers should also specify whether the Islamic securities being issued are tradeable under sharia rules. In addition, the SCA set out basic provisions for the composition and responsibilities of sharia boards. The SCA regulation provides a general framework for disclosure around these issues, not a detailed template. Nevertheless, the regulation is one of a number of initiatives that could support the UAE's sukuk market.

GII Islamic REIT acquires $32mln office in Dubai

GII Islamic REIT has acquired an AED 117.54 million two-floor office property in Downtown Dubai developed by Emaar Properties. The property is under a lease agreement with a global professional services firm, whose term will end after three years. The property was sold in consideration of $32 million with gross yields of around 8%. According to Mohammed AlHassan, CEO of GII, this is a high-quality acquisition for the REIT, and is consistent with GII REIT’s strategy to distribute 8% annual dividend to investors net of all costs.

Sharjah turns to the debt market to raise investment capital

The government of Sharjah is tapping the debt markets to help fund large-scale infrastructure and economic development programmes. On March 8 the emirate closed the book on a dollar-denominated sukuk, valued at $1bn. The 10-year bond was listed on the NASDAQ Dubai with an initial price of 150 basis points over the 10-year mid-swap rate, which then tightened to 135 basis points. Demand was high and the bond was oversubscribed, at around $2.4bn. Book runners were local, regional and global lenders, including the Sharjah Islamic Bank (SIB), Dubai Islamic Bank, HSBC and Standard Chartered. In early February the emirate also became the first Gulf sovereign issuer to tap the Chinese interbank bond market, issuing a RMB2bn ($318.4m) Panda bond. The increased investment is expected to boost GDP growth, with ratings agency S&P anticipating growth of 2.5% per year by 2020.

Al Baraka Banking Group and the Bank of London & The Middle East (BLME) sign a Memorandum of Understanding to enhance their collaborations and product offerings.

Al Baraka Banking Group (ABG) has signed a Memorandum of Understanding (MoU) with the Bank of London & The Middle East (BLME). The MoU was signed by Mohammed El Qaq, Senior Vice President & Head of Commercial Banking of Al Baraka Banking Group and Andrew Ball, Head of Wealth Management of BLME. The MoU provides both parties with opportunities to collaborate and gives BLME the chance to provide Al Baraka clients with investment opportunities in UK real estate. According to ABG President Adnan Ahmed Yousif, the MOU will enable the bank to enhance its product offerings and capitalize on its geographic diversification and wide client base. Al Baraka currently has a strong presence in Turkey, Jordan, Egypt, Algeria, Tunisia, Sudan, Bahrain, Pakistan, South Africa, Lebanon, Syria, Iraq, Saudi Arabia and Morocco, including two representative offices in Indonesia and Libya.

New report highlights how Islamic financial institutions are addressing the environmental & social impact of their financing

The Responsible Finance & Investment Summit 2018 concluded with a report about Islamic financial institutions’ perceptions and actions on their environmental and social impacts. The report includes a detailed survey of over 30 Islamic financial institutions’ sustainable finance practices. During the RFI Summit 2018, participants heard a call to action on impact finance from speakers like HRH Emir Muhammadu Sanusi II, Emir of Kano, Dr. Henri B. Meier, Dr. Iyad Abu Moghli and others. The winners of the Support Disruption for Good Challenge presented their companies. The three winners, AID:Tech, INBONIS and thirdACT, demonstrated how companies can use technology to enable greater investment and financing to flow to support healthcare, agriculture and sustainable cities.

SEDCO Holding Group Signs a Partnership Agreement with Saudi British Bank

SEDCO Holding Group signed a partnership agreement with the Saudi British Bank (SABB), for its Riyali Financial Literacy Program. The agreement was signed by Hasan Al Jabri, CEO of SEDCO Holding Group, and Naif Alabdulkareem, General Manager Retail Banking at SABB. The Riyali Financial Literacy Program attained the Ministry of Education’s endorsement to roll out the program in grade school as well as universities. The program aims to educate future generations on the importance and benefits of financial awareness. The program has already reached more than 400,000 beneficiaries and aims to reach 2 million beneficiaries by 2020.

GCC Islamic Banks' Financial Profiles to Stabilize in 2018

According to S&P Global Ratings, Islamic banks in the Gulf Cooperation Council (GCC) countries should see their financial profiles stabilize through 2018. S&P's Global Head of Islamic Finance, Mohamed Damak expects that GCC Islamic banks' total asset growth will remain in the low single digits over the next 12-24 months, after stabilizing at about 4% for the GCC system in 2017. He also expects that cost of risk for Islamic banks will rise, due to the adoption of International Financial Reporting Standard 9 and Financial Accounting Standard 30. Combined with the introduction of value-added tax, the increase in risk costs will result in a dip in the profitability of Islamic banks in the next two years.

Green developments in Islamic finance

Increasing environmental awareness worldwide has seen a marked rise in the appetite for green bonds. Malaysia has been the market leader in the issuance of Green Sukuk, with guidelines issued in 2014 for socially responsible investment (SRI). These set out that the proceeds can be used to preserve the environment and natural resources, conserve the use of energy, promote the use of renewable energy and reduce greenhouse gas emission. Malaysia launched the world’s first Green Sukuk on 27 June 2017. The UAE's Green Growth Strategy was launched in 2012 to become a global hub and a successful model for the low carbon green economy. There will most certainly be challenges, like drafting of documentation acceptable to governments, investors and Shari’ah scholars. There is increasing appetite for environmentally friendly products and considerable potential in the UAE.

Bonds and #Sukuk: Structuring fixed income instruments in GCC

According to Fisch Asset Management CEO Philipp Good, the GCC bond and Sukuk market is generally sound. The GCC debt market has seen considerable development, in terms of issuance volume and spread, for both the conventional and Islamic space. The bond and Sukuk pipeline in the GCC for the last two to three years has been dominated by the senior unsecured USD format. At the same time, some project bond issuance has occurred in the GCC, which has utilised highly innovative structures. Recent hybrid issuances from corporates, and Additional Tier 1 bonds and Sukuk from banks such as First Abu Dhabi Bank, Dubai Islamic Bank and Noor Bank, all prove that there is plenty of scope for more sophisticated instruments to be offered. The investor base for GCC debt is now more diverse than ever before, and 2018 looks to be another strong year. It will probably be weighted towards corporates, with sovereigns having dominated the market in 2017.

RFI #Summit 2018 is partnering with the leading global environmental authority to increase links between faith-based finance & environmental impact

The UN Environment Programme is organizing a pre-Summit roundtable on "Faith-Consistent Financing Prospects to Achieve the Sustainable Development Goals (SDGs)". The roundtable will explore opportunities for faith-based financial institutions and asset owners to promote common efforts that can increase their collective impact. Iyad Abumoghli, Principal Advisor at UN Environment said the UN was excited to partner with the RFI Summit, which has developed into a leading platform for encouraging dialogue between faith-based institutions and the financial sector.

For more information about the RFI Summit 2018 and to register, please visit www.rfisummit.org.

Ebdaa Bank backs #microfinance proposal for GCC charity projects

Ebdaa Bank has agreed to a proposal to microfinance charity projects to achieve their objectives to support low-income families. Ebdaa Bank CEO Dr Waleed Al Ghazawi welcomed officials from Almajdouie Group and stressed the need for the GCC to adopt microfinance due to its benefit for charity donations. The Almajdouie Group is visiting Bahrain to share ideas about their sustainable charity projects. The group’s new project is called "Basta", which has already launched six booths in Saudi Arabia, distributed in Dammam and Al Khobar. The project aims to support kiosks to develop their projects.

DFSA hosts accounting standard-setters for Islamic finance

The Dubai Financial Services Authority (DFSA) recently hosted the International Accounting Standards Board (IASB) as part of a consultancy meeting. The Authority's involvement reflects its commitment to developing an effective and supportive regulatory framework for Islamic finance. The DFSA is a member of the Islamic Finance Consultative Group (IFCG), which focuses on challenges that may arise in the application of International Financial Reporting Standards (IFRS). The meeting was attended by IFCG members from Bahrain, Indonesia, Malaysia, Pakistan, Saudi Arabia, the UAE and the United Kingdom.

IDB Group and World Bank launch second edition of Global #Report on Islamic Finance

The Islamic Development Bank (IDB) Group and the World Bank Group launched the second edition of the Global Report on Islamic Finance. The report is entitled "The Role of Islamic Finance in Financing Long-Term Investments". It presents a global perspective on the need for long-term investments in the Sustainable Development Goals (SDGs) and proposes the use of Islamic finance. Despite the huge potential in Islamic finance, the report notes that the Islamic financial sector is a small player in the global financial markets and requires a concerted push for the regulatory and legal changes to take root. It therefore recommends strengthening the Islamic financial system by developing a supportive legal, administrative, and regulatory environment. The biennial Global Report on Islamic Finance is a joint initiative of the Islamic Research and Training Institute (IRTI) of the IDB Group and the World Bank.

CBK-IFSB #Conference on Islamic Finance themed "Islamic Finance: A Universal Value Proposition"

The Central Bank of Kuwait (CBK) and the Islamic Financial Services Board (IFSB) are organizing a conference on Islamic Finance on the 2nd of May 2018. The conference will be held in the State of Kuwait in conjunction with the IFSB Annual Meetings 2018, hosted by the CBK. The CBK-IFSB Islamic finance conference is expected to attract senior-level participation from among the global and financial industry stakeholders and thought leaders. Discussions will revolve around the role Islamic finance can play in government strategies to build a diversified and sustainable economy. The IFSB Annual Meetings 2018 will be held in Kuwait from 1–3 May 2018. Alongside the conference, CBK is also hosting the IFSB Public Lecture, Members and Industry Engagement Session, the IFSB’s General Assembly and Council Meetings during the 3 days.

Corrected: Arkan Bank could tap investors for $200mln through Nasdaq Dubai listing

Dubai Investments announced the establishment of a new Islamic bank called Arkan Bank. It will be the first home-grown, wholesale Islamic Bank operating from Dubai International Financal Centre. It will have an initial paid-up capital of $100 million and another $200 million will be raised after 12 months of its establishment through listing on Nasdaq. CEO Khalid Bin Kalban said Dubai Investments will initially hold a 25% in the bank and would aim to retain a stake of that size. He added that Arkan Bank's core business lines would be corporate banking, asset management and awqaf, investment banking and treasury. Arkan Bank initially plans to focus on the GCC region and subsequently build scale to become the top-tier Islamic wholesale bank in the region.

Arkan Bank could tap investors for $100mln through Nasdaq listing

Dubai Investments announced the establishment of a new Islamic bank called Arkan Bank. It will be the first home-grown, wholesale Islamic Bank operating from Dubai International Financal Centre. It will have an initial paid-up capital of $100 million and another $100 million will be raised after 12 months of its establishment through listing on Nasdaq. CEO Khalid Bin Kalban said Dubai Investments will initially hold a 25% in the bank and would aim to retain a stake of that size. He added that Arkan Bank's core business lines would be corporate banking, asset management and awqaf, investment banking and treasury. Arkan Bank initially plans to focus on the GCC region and subsequently build scale to become the top-tier Islamic wholesale bank in the region.

Emirates Islamic Bank supports Rental Disputes Center initiatives

The Rental Disputes Center (RDC) has received a generous donation of AED 500,000 from Emirates Islamic Bank to support insolvent tenants in rental claims disputes. The RDC has already set up the "Yad Al Khair Committee" to study the cases that require support from the donation. Awatif Al Harmoodi, General Manager of Operational Quality & Processes at Emirates Islamic Bank, said Emirates Islamic Bank is keen to expand its corporate social responsibility strategy to cover all segments of the UAE and will continue to cooperate with the RDC.

Al Hilal Global #Sukuk Fund delivers 3.93% dividend

Al Hilal Bank has announced the dividend payout of the Al Hilal Global Sukuk Fund. The Fund, which was launched in March 2012, distributed a 3.93% dividend to all registered unit holders. Al Hilal Bank CEO Alex Coelho said the Fund had registered excellent cumulative total returns since its inception in 2012. Al Hilal Bank currently offers 3 open-ended mutual funds inclusive of the Global Sukuk Fund. In 2017, Al Hilal Global Sukuk Fund was awarded the title "Best Fund over 3 years", while the GCC Equity Fund received the "Best Islamic Fund" award in 2013 and 2014. The bank plans to continue launching investment products as part of its ongoing efforts to create value and increase diversification for its clients.

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