Saudi Gazette

ICD, Mizuho Bank (M) Berhad seal $150m #Murabahah deal

The Islamic Corporation for the Development of the Private Sector (ICD) and Mizuho Bank have formalized the signing of a Murabahah deal. The financing is earmarked for the purpose of scaling up of ICD’s projects in its selected 55 member countries. The $150 million Murabahah agreement is the second bilateral Islamic facility that has been extended to ICD by Mizuho Bank. The agreement was signed by Khaled Al Aboodi, CEO of ICD and Shojiro Mizoguchi, CEO of Mizuho Bank. Al Aboodi expressed his strong support for the partnership. Shojiro Mizoguchi said he was very proud to continue to work with ICD and looking forward to leverage on each other’s expertise and experience.

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http://saudigazette.com.sa/article/521372/BUSINESS/ICD-Mizuho-Bank-(M)-Berhad-seal-$150m-Murabahah-deal

SEDCO Capital discusses #ethical #investment in forum

#Saudi asset manager SEDCO Capital participated in the Islamic Finance Forum in London as an associate sponsor. Several panels and workshops were held focusing on trends in Islamic Finance and European markets. Panel topics included the role of European Stock Exchanges in facilitating Islamic capital raising, Islamic corporate financing activity in Europe and the impact of Brexit. Kamran Butt, Managing Director at SEDCO Capital, participated in the panel discussion entitled "Responsible Investing: The Shift towards Green Finance, ESG & Ethical Funds". Butt said SEDCO's Prudent Ethical Investing (PEI) strategy created optimal risk adjusted returns by integrating Shariah-compliant investment approach with ethical investing. PEI stresses the importance of due diligence and transparency. PEI investment products are getting increasingly popular. International investors can choose from over 14 SEDCO Sharia-compliant investment strategies in Luxembourg with total AUMs of $1.8 billion.

First Shariah-compliant #M&A #insurance policy in MENA region launched

American International Group (AIG) has placed the first Shariah-compliant mergers and acquisitions (M&A) insurance policy in the Middle East and North Africa region (MENA). AIG’s Warranty and Indemnity insurance product helps protect buyers and sellers from financial losses if misrepresentations occur. Buyers can distinguish bids, sellers can reduce indemnity obligations. AIG was advised by global law firm Norton Rose Fulbright, led by corporate/M&A partner Adjou Ait Ben Idir. Associates were Agnieszka Braciszewska (lead associate), senior associate Rachel Moylan (IT/IP aspects) and of counsel Louisa Lynch (real estate aspects). Partner Dominic Stuttaford advised on tax aspects. Mark Storrie, M&A Manager at AIG said M&A insurance provided a unique solution for MENA clients investing both in the region and globally. He was very pleased to have placed the first M&A policy in the region.

DIEDC opens nominations for 5th Islamic Economy Award

The Dubai Islamic Economy Development Centre (DIEDC) announced the commencement of nominations for the fifth edition of the Islamic Economy Award (IEA). The award is a joint initiative of DIEDC and Dubai Chamber of Commerce and Industry under the directives of Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum. The eight key categories of the Islamic Economy Award 2017 are: Money and Finance, Food and Health, Media, Hospitality and Tourism, Waqf and Endowments, SME Development, Islamic Economy Knowledge Infrastructure and Islamic Arts. In addition to the eight main categories, the Lifetime Achievement Award recognizes a notable individual, whose work over several decades, has inspired others and had a major positive impact on the Islamic economy.

IDB promotes connectivity for sustainable development

The Islamic Development Bank (IDB) Group organized an event on "Promoting Connectivity for Sustainable Development". The event was chaired by Hani Salem Sonbol, CEO of the International Islamic Trade Finance Corporation (ITFC) and the keynote speech was delivered by Aja Fatoumatta Jallow Tambajang, vice president of Gambia. The event provided an in-depth analysis of the IDB Group strategic objectives in financing infrastructure investments. The event was also an opportunity to bring together experts and exchange ideas on growth and connectivity among member countries. Sonbol stated that the IDB Group adopted a 10-year Strategy and one of its objectives is "Connectivity for Growth". The objective is to promote cooperation among member countries, both in terms of private sector and public-sector cooperation to enhance trade, investment, knowledge, and capacity development.

Islamic finance growth to lose momentum in 2018: S&P report

According to S&P Global Ratings, the Islamic finance industry will continue to expand this year, but will lose some momentum in 2018. Even though sukuk issuance accelerated in the first half of this year and will likely stay strong in the second half, S&P Global Ratings believes this growth rate is not sustainable. In their view, the current economic situation in core Islamic finance markets and depreciation of local currencies have weighed on the industry’s performance in 2016 and 2017. The report foresees a deterioration of GCC Islamic banks’ profitability in 2017 and 2018 as the cost of funding has increased and the cost of risk is on the rise. Sharia is still interpreted in different ways across the various Islamic finance markets. However, the industry appears to be going in the right direction with the proposal for central Shariah boards.

ICD, stakeholders tackle opportunities, challenges

On the occasion of the Islamic Development Bank Group 42nd annual meeting, the Islamic Corporation for the Development of the Private Sector (ICD) organized a side event entitled ICD Clients Day. During the event, ICD seized the opportunity to meet with potential clients and stakeholders from private sectors. In addition, ICD presented its achievements in 2016 and awarded its Best Clients for 2016, namely Coris Bank International, Vitamed Medical Diagnostic Center and Al-Qadi Specialty Hospital. ICD general manager Khaled Al-Aboodi opened the session welcoming all the participants. Later on, Thomson Reuters presented the last edition of the Islamic Finance Development report. The event was a chance to share knowledge, to assess new opportunities and to network with the decision-makers, industry leaders and experts.

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.

Ziad Aba Al-Khail named ‘#Best #Brokerage #CEO – KSA’ in 2016

The International Finance Magazine (IFM) granted Eng. Ziad Tarek Aba Al-Khail, CEO and Managing Director of Aljazira Capital, the “Best Brokerage CEO – KSA Award” in 2016. Aljazira Capital was also granted the “Fastest Growing Islamic Brokerage House-KSA Award” in 2016.
Ziad Aba Al-Khail was really proud of the IMF’s appreciation of the performance. Such a constant international recognition of his team is a living example of our constant commitment to provide our customers with the best services as well as adopt up-to-date strategies in world trade in order to create new horizons for their customers and give them access to regional and global capital markets.”
Ziad Aba Al-Khail also expressed his gratitude and thanks to Aljazira Capital team whose efforts led to this achievement, and added: “This remarkable achievement is the fruit of our company strategy in rendering and managing an integrated system of Islamic-oriented financial services and investment solutions of unique value and high quality.”

Islamic finance industry growth remains resilient

According to the Islamic Finance Development Indicator (IFDI), global Islamic finance development declined to 8.8 in 2016 from 9.9 in 2015. The report was prepared by Thomson Reuters and the Islamic Corporation for the Development of the Private Sector (ICD) and was released at the World Islamic Banking conference (WIBC) 2016. Malaysia, Bahrain and the UAE continue to dominate the IFDI report for the 4th consecutive year. However, Malaysia posted a slight decline in its overall IFDI performance in 2016. Outside of the top 15, noteworthy emerging countries that have moved up the IFDI rankings are South Africa, Morocco, Tanzania, Japan and Russia. Among the regions with high potential in Islamic finance is West Africa. Unprecedented oil price storm hindered Islamic finance performance, but not asset growth. Despite lower financial performance, Thomson Reuters maintains a positive outlook for the industry projecting Islamic finance assets to reach $3.5 trillion by 2021.

#Sukuk crucial to diversifying investments: CMA vice chair

Mohammed Al-Quwaiz, vice chairman of the #Saudi Capital Market Authority (CMA), underscored the importance of Sukuk and debt instruments for investors. He made the remarks during the opening of Sukuk Conference with the theme of "Sukuk Market: Challenges and opportunities" in Riyadh. The two-day event was organized by CMA in collaboration with the World Bank. Al-Quwaiz noted that Sukuk and debt markets represent important options to provide funding for various projects and facilities. The conference covers the elements of Sukuk markets, the dynamics of Sukuk markets, ways to create an effective environment for Sukuk market, regulatory issues and corporate governance in Sukuk market, and the role of debt markets in economic growth. The conference is discussing the challenges in Saudi Arabia in particular and in the GCC states in general.

Majority suffering from financial distress – Poll

The latest #Saudi Arabian survey conducted by Riyali Financial Literacy Program shows that more than 86% of the respondents have suffered from some form of financial distress. This high percentage sheds light on the importance of spreading financial awareness to manage a stable financial life. The survey also showed that most of the commitments that the participants failed to fulfill were finance installments (44%), followed by borrowing from friends and family (34%), and then credit card payments (22%). In addition to that, the survey highlighted another noticeable problem, which is the high debt burden ratio where monthly installments of 42% of the participants exceeded 60% of their monthly salary. In this regard, the Saudi Arabian Monetary Agency (SAMA) has set the limit at 33% for the monthly debt burden that a customer can afford, to be able to successfully pay off debts.

Islamic finance key to fill funding gaps in sustainable development

The third plenary session of the first day of the Global Islamic Economy Summit 2016 examined whether blended finance is the answer to funding sustainable development. The session explored the role of wealthy Muslim governments, sovereign wealth funds and Islamic financial institutions in achieving sustainable development goals within a realistic timeframe. Dr. Mohammed Yousef Al Hashel, Governor of the Central Bank of Kuwait, examined whether the sheer scale of sustainable development goals (SDGs) was responsible for a funding gap, as well as the best ways to address such obstacles. Investments in SDGs are not attractive to investors, he said, adding that the very nature of Islamic economy may offer a solution to these challenges. According to Dr Al Hashel, we need to progress from Shariah-compliant products to a Shariah-based system that doesn’t just mimic traditional banking, but rather innovates and creates new products and solutions.

IDB’s endowment fund to boost NGOs in #India

Muslim NGOs in India will be able to make use of Islamic Development Bank’s Awqaf Properties Investment Fund (APIF) to develop their endowments and generate funds for their various community development projects. According to Zafar Javeed, IDB’s national convener for India, APIF is in the process of identifying viable endowment projects. Javeed commended IDB group for financing about 300 educational and health-related projects across India over the past three decades. He said that the IDB was a big blessing for the Muslim community in India and there were many projects in the pipeline awaiting IDB aid. Referring to ongoing efforts to introduce interest-free banking in India, Javeed said former RBI governor Reghuram Rajan had hinted at introducing the system to achieve inclusive development.

Qinvest hikes revenues to $65.7 million in H1

#Qatar’s QInvest said that its revenues rose to $65.7 million and net profits increased to 25.3 million (QR92.1 million), compared to $24.4 million (QR88.7 million) in H1 2015. The main drivers behind the results include exits in the firm’s investments, strong performance in its international real estate portfolio and increased fee revenue. CEO of QInvest Tamim Hamad Al-Kawari said the company recorded a satisfactory half-year performance across all business lines in the face of economic uncertainties. QInvest is reviewing and stress-testing its portfolio to match the heightened volatility levels and headwinds of the markets.

IDB Private Sector #Forum fosters economic growth

The Islamic Development Bank (IDB) Group hosted the IDB Group Private Sector Forum in Indonesia. The event was held in conjunction with Group's 41st Annual General Meeting. The forum involved panel discussions which deliberated on the activities, roles and support that have been carried out in member countries, with focus on Indonesia. The panel also touched on issues related to Islamic trade financing, investment challenges and export credit insurance. All private sector entities are open to coordinate with investors who are willing to invest in Indonesia as well as other member countries of the IDB Group.

Full Text of Saudi Arabia’s Vision 2030

The Council of Ministers presents Saudi Arabia’s vision for the future. Saudi Arabia will transform the Public Investment Fund into the world’s largest sovereign wealth fund. They will expand the variety of digital services to reduce delays and cut bureaucracy. Goals by 2030 include increasing non-oil government revenue from SR163 billion to SR1 trillion, raising the country's ranking in the Government Effectiveness Index from 80 to 20, raising the ranking on the E-Government Survey Index from a current position of 36 to be among the top five nations.

GCC sovereign issuance can be hugely instrumental for takaful stability

The 11th annual World Takaful Conference concluded its two-day proceedings, following the launch of an intelligence report by the forum’s conveners, Middle East Global Advisors. "The Finance Forward World Takaful Report: Connecting the Dots, Forging the Future" was launched as part of WTC’s commitment to supporting the Takaful industry. The Report provides a way forward to addressing various challenges ranging from price wars and pricing regulation, to closing the gap of human capital, and includes contributions from UK & Netherlands-based boutique consultancy, Takaful Outsource. The 12th annual edition of WTC will take place in April 2017.

CMA staff attend course on ‘Islamic Economics’

As part of the training programs provided internally by Capital Market Authority (CMA), Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) has held the 2nd batch of the training course “Essentials of Islamic Economics and Finance” to CMA’s management team members and employees, on March 21-22, 2016, in Riyadh. The course was delivered by Sheikh Dr. Yousef Al-Shubaili and Dr. Sami al Suwailem. AAOIFI’s active institutional membership includes more than 13 regulatory and supervisory authorities (for capital markets, insurance and finance) and central banks. AAOIFI provides its technical and professional services to a number of supervisory and regulatory bodies across the globe.

Fitch ranks Saudi banking system 4th globally

The international rating agency Fitch ranked the Saudi banking system fourth-best and the strongest banking system in the world, after Australia, Canada and Singapore, said Governor of the Saudi Arabian Monetary Agency Dr. Fahd Al-Mubarak. In a speech during the Islamic Banking and Finance Conference organized by Makkah-based Umm Al Qura University, he said that financial activity compatible with the provisions of Islamic law is witnessing a remarkable growth at the international level, with an average ratio estimated at 17% per annum.

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