Europe

Gatehouse Bank appoints ex-Shawbrook director

Gatehouse Bank has appointed former Shawbrook Bank director Tim Blease as its new chief operating officer (COO). Tim Blease’s previous roles include new business strategy and innovation director at Shawbrook and head of retail credit risk at Metro Bank. The bank has also appointed Sharron Harvey as its executive vice-president head of HR. Sharron has previously worked for Habib Bank Zurich and has 20 years of HR experience, mainly in the financial sector. Both Tim and Sharron will report to Charles Haresnape, CEO of Gatehouse Bank. The appointments come after Gatehouse revealed a number of changes to its board last week.

Bosna Bank International, Una-Sana Canton sign deal to back business

The government of Bosnia's Una-Sana Canton said it has signed a deal with Bosna Bank International (BBI) to fund business entities in the area. Under the deal BBI will provide financing to businesses in the canton under favourable conditions at a subsidized rate of 2.3%. BBI has secured 12.49 million marka ($7.4 million/6.4 million euro) for the project. The maximum amount that can be approved per business is 1 million marka, with a repayment period of three to seven years depending on the size of the loan.

The future of Islamic finance in #Spain

In Spain the Muslim population exceeds two million being higher than that of Qatar or Bahrain and similar to the population of Kuwait. However, there are no Shari'ah compliant services or assets under management. Europe advances in this type of financing. The United Kingdom was the first non-Muslim country that held in 2014 an emission of sovereign Sukuk bonds amounting to 200 million pounds. In 2015 Kuwait Finance House (KFH) opened a subsidiary in Germany, Habib Bank Zurich will operate in the UK at the end of 2017. There is a clear tendency that Islamic banks are expanding their activities in Western countries and continue introducing their products in these markets. In Spain there is an excellent opportunity to implement Islamic finance as currently there is no market operator offering Shari'ah compliant products or services.

Le combat de la ville de Nice contre une enseigne de «finance islamique»

Alors qu'une société souhaitait installer des enseignes lumineuses avec la mention "finance islamique", le tribunal administratif de Nice a validé le refus de la mairie. Un nouveau dossier communautaire à gérer pour la ville, un an après l'affaire des burkinis. Le dossier pourrait raviver les tensions. Le tribunal administratif de Nice a débouté aujourd'hui jeudi 6 juillet la société Noorassur de sa requête contre la mairie de Nice, et a validé le refus par la mairie que la société appose deux enseignes lumineuses. Le juge a estimé que la décision de la mairie ne pouvait être regardée comme portant atteinte. Dans un communiqué, Christian Estrosi s'est félicité de la décision du tribunal. Du côté de la société Noorassur, l'ordonnance rendue en référé ne clôt pas l'affaire.

London court to hear Dana Gas #sukuk case in September

London's High Court plans to hold a full hearing in September on efforts by Abu Dhabi-listed Dana Gas to restructure $700 million of its outstanding sukuk. Dana Gas declared the bonds invalid last month, saying they were no longer compliant with changing interpretations of the Sharia law. The judge upheld an interim High Court injunction blocking holders of the bonds from enforcing claims related to the securities against Dana Gas. However, he imposed restrictions on asset sales by Dana and its ability to raise more debt or pay dividends. The case has worried the Islamic finance industry as it has raised the prospect that other firms could justify not honouring obligations by claiming sharia-based financial standards had changed.

Market-leading Sharia #savings #accounts: should you consider them?

A number of Sharia savings products are beating competitors and are playing their part in kick-starting small rate increases. Currently in the fixed bond market, Sharia savings accounts top every single category. As well as top returns, they also appeal to the more ethical saver or investor as the money is invested, not lent out. According to James Blower, managing director of Savings Guru, Sharia-compliant savings have developed their niche very well and will grow in popularity. He says there are three reasons why Al Rayan is one of the most successful Islamic banks in the UK. It has a low minimum entry level, wide range of options for customers to deal with it and it rebranded from Islamic Bank of Britain to Al Rayan Bank. An interesting point to note is that 86% of Al Rayan customers are non-Muslim. In the UK Al Rayan, BLME and Milestone are all regulated by the Financial Conduct Authority (FCA) and are members of the Financial Services Compensation Scheme (FSCS) which protects deposits of up to £85,000.

Why London Will Remain The Islamic Finance Hub Of The West

London’s popularity as an Islamic finance hub emerged in 2013, when Prime Minister David Cameron unveiled plans to develop the city into the Western capital of Islamic finance. In 2014, London took a step further when Britain became the first country outside the Islamic world to issue sovereign Sukuk. The key benefit of this policy was attracting additional liquidity from investors in the Middle East and Asia adhering to Islamic finance principles. The London Stock Exchange is a key global venue for the issuance of Sukuk. According to the LSE Group official website, over $48bn has been raised through 65 issuances. Other centres such as Dublin and Luxembourg also have ambitions to attract Islamic financial services. Furthermore, in April this year Saudi Arabia listed its biggest ever sharia-compliant bond on the Irish Stock Exchange, so the competition between the Western financial centres is more intense than ever.

Gassner's picture

Bitcoin Mania versus Tulip Mania?

Dear Reader,

regular readers may remember my critic on bitcoin from an Islamic perspective missing intrinsic value. The former blog entry you find here: http://www.islamicfinance.de/?q=node/7840 - almost two years ago.

So far bitcoin just went up higher and higher, with wild fluctuations but nevertheless.

It reminds on how bubbles work, think about the tulip mania in 1637 a nice piece of economic history. A single tulip bulb was traded and bought on credit. Check the Wiki page on it:

https://en.wikipedia.org/wiki/Tulip_mania

As bitcoin has even less value than a tulip except for payment purposes, it is the payment functionality, which can lead to destruction. What happens if a new alternative currency is becoming en vogue, which has a better usability and faster transaction time? In my view this is most likely trigger to burst the bubble.

FT Alphaville covers now the difficulties coming up with bitcoin's increasing transaction numbers causing inconvenience in using the digital currency:

https://ftalphaville.ft.com/2017/05/17/2188961/the-currency-of-the-futur...

#UK slowly progressing towards providing Shariah compliant #student #finance

The UK Government has been thinking about the possibility of introducing Shariah compliant student finance since 2011. The Higher Education and Research Bill is currently before Parliament. However, the Bill contains no time-scale for when a Shariah compliant system is likely to be in place. When the Bill was reviewed in the House of Lords, Lord Sharkey proposed an amendment to give a deadline of the 2018-2019 academic year for the introduction of such a scheme. This proposal was rejected by the Government. Lord Sharkey instead proposed an amendment requiring quarterly progress reports from the Secretary of State. The final outcome is that the Bill will proceed forwards and once it has completed all stages, the Secretary of State for Education will have the power to implement a Shariah compliant student finance system.

Married banker from Norbiton takes Abu Dhabi Islamic Bank to employment tribunal after she was 'pimped out' to secure Arab client worth £25m

A married senior banker was "pimped out" by her boss in a bid to get a wealthy Arab client to open an account with £25 million. Suemaya Gerrard, a relationship manager at the Abu Dhabi Islamic Bank, claimed the client bombarded her with love songs and inappropriate text messages. She added that bank CEO Jawdat Jawdat put pressure on her to go out to dinner with the man and she was threatened to lose her job if she did not go. Suemaya Gerrard resigned from the bank last November and is now suing it for sexual discrimination, sexual harassment and constructive dismissal. The bank and Mr Jawdat deny all the allegations. Mr Jawdat claimed it was normal practice to entertain clients and dine with customers.

Leading #Scottish Islamic finance expert to speak at Responsible Finance & Investment #Summit

Graham Burnside, a consultant at Shepherd and Wedderburn, is to speak at the RFI conference in Zurich. The Responsible Finance & Investment Summit (RFI Summit) is a two-day event hosted by the RFI Foundation and the Swiss Arab Network. The event is aimed at building awareness of how the social and environmentally responsible investment and Islamic finance can create a positive impact. Mr Burnside is a founding member of the Islamic Finance Council UK (UKIFC), a Scottish-based not-for-profit specialist advisory established to promote ethical finance. In 2015, the UKIFC was recognised by Ethical Finance Innovation Challenge Awards (EFICA), winning the $100,000 Islamic Finance Industry Development Award. Mr Burnside has been invited to take part in the RFI Summit panel looking at financial inclusion and responsible finance.

Introducing #sukuk bonds in #Malta

Discussion about sukuk bonds is on the increase. The government of Malta has also considered issuing this type of security. Meanwhile, many established players on the international capital markets are issuing sukuks. A sukuk has a secondary market in the same way as a typical bond has and investors may buy, hold or sell the sukuk after this has been issued in the primary market. Hence, liquidity considerations are also relevant for sukuk bonds. The buyer of a sukuk bond is indirectly buying an asset that has value rather than entering into a loan obligation with the issuer of a typical debt instrument. Importantly, the number of investors in the Islamic world cannot be ignored and therefore Sharia compliant vehicles capable of attracting their wealth are increasingly relevant. The sukuk is a good starting point for issuers to tap into this reality.

QIB-#UK finances Buy-to-Live properties in London

QIB-UK has received official licensing to provide Sharia-compliant Murabaha Facilities for London properties. The new product enables QIB-UK to finance a buy-to-live property as well as refinance customers’ existing properties in London. QIB-UK has undergone a restructuring process to focus on serving the bank’s high-net-worth clients by addressing their specific financial needs in the UK. The bank offers its customers a range of Sharia-compliant banking services including Current Accounts in GBP, inward and outward transfers, direct debits, standing orders and more. QIB-UK also provides Debit Cards which are linked to a client’s current account with a high daily allowance of £15,000. Additionally, the Bank offers Wakala Deposits, Instant Access Savings Account, Notice Accounts and other premium products and services. QIB-UK was fully authorised as an Islamic Bank by the UK Financial Services Authority in 2008 and is fully owned by Qatar Islamic Bank.

Different approach pays off for Al Rayan Bank

Sultan Choudhury, CEO of Al Rayan Bank, talks about Islamic finance in Britain and its appeal to non-Muslims. He says, Islamic finance appeals to anyone who agrees with the underlying principles: equitable distribution for everyone, prudent spending and the well-being of the community as a whole. It also provides an ethical alternative to traditional banking. Al Rayan Bank is structured to ensure that it operates ethically on a day-to-day basis. The bank's home-purchase plans (HPP) are structured differently to conventional mortgages. HPPs are based on the Islamic finance principles of ijara and diminishing musharaka. Currently the bank estimates that more than a quarter of customers are non-Muslim and the customer base is expected to grow in the coming years.

Bosna Bank International's 2016 net profit rises

Bosna Bank International's net profit increased to 6.4 million marka ($3.5 million/3.3 million euro) last year from 5.6 million marka in 2015. Net interest income grew 22.5% year-on-year to 22.3 million marka in 2016, while net fee and commission income rose to 10.9 million marka from 9.6 million marka. The bank's total assets stood at 895.4 million marka at the end of 2016.

Islamic lender shows #UK appeal of Sharia finance

In Great Britain there are currently six Islamic banks, while another 20 lenders offer Islamic financial products and services. Al Rayan is Britain’s largest Sharia-compliant bank with 70,000 customers and 13 offices and branches. The bank underwent a major overhaul in 2014 when it was acquired by its Qatari parent, Masraf Al Rayan. Since that point, the brand was made more accessible, the imagery is no longer just Arabic, the bank uses British imagery as it is targeting all Brits. CEO Sultan Choudhury says about 25% of the bank’s customers are non-Muslim. Mr Choudhury also has his eyes fixed on the potential of the wider international market. In particular, he highlights the GCC national and expat market and HPPs (mortgages with an interest-free and Sharia-compliant structure). He says, Al Rayan's ambition is to be the number one bank for HPPs for GCC nationals and expats.

London Stock Exchange Welcomes Islamic Development Bank #Sukuk Bond – Largest Issuance By A Supranational In

London Stock Exchange welcomes the largest Sukuk issued by a supranational globally in 2017, raising $1.25bn. The isssuance is listed by the Saudi Arabia based Islamic Development Bank and is a five-year bond with a 2.393 % yield. This listing adds to the broad range of Islamic finance products available to investors on London Stock Exchange. According to Nikhil Rathi, CEO of the London Stock Exchange, the listing demonstrates London’s standing as the world’s most international financial centre and confirms the UK as the key destination for Shariah-compliant financial products. The CFO of Islamic Development Bank, Dr. Ahmet Tiktik, said choosing London as the location for the new $1.25bn Sukuk shows the bank's continuous support for London Stock Exchange.

Baker McKenzie wins major #litigation case for Dubai Islamic Bank

Global law firm Baker McKenzie has successfully acted for Dubai Islamic Bank in its defence of a $2 billion claim brought against it in the English Commercial Court. The claim was brought by Plantation Holdings, a holding company owned by an Argentinian-resident property developer. The allegation was breach of contract related to plot of land on the outskirts of Dubai, which Plantation had planned to develop into a high-end luxury lifestyle and equestrian complex. The Bank took security over the project as part of the restructuring of a $500 million debt owed to it as a result of a complex receivables financing fraud. The case was heard in an eight week trial, with evidence from witnesses from seven jurisdictions. The court ruled that Plantation's principal director had made up evidence and that another of Plantation's witnesses had manufactured documents, Plantation has been ordered to pay 70% of the Bank's costs on the indemnity basis. The nature of the case also resulted in examining the volatility of the Dubai property market and the functionality of its property registration system, as well as the Dubai authorities' approach to financial misconduct.

#Kuwait's Warba Bank boosts its #realestate investments portfolio & acquires a facility of KIA Motors in #UK

Warba Bank has recently purchased a newly constructed UK vehicle imports-exports facility strategically located next to Immingham port. The property is leased to KIA Motors UK for unbreakable lease term of 20 years. The facility has a capacity of over 15,550 cars and totalling 86.68 acres (35.08 hectares) of land. In addition, the site also includes a warehouse space of 63,515 ft.² (5,901 m²), facilitating distribution, refurbishment, valet, inspection, refuelling, offices and gatehouses. The site receives on average c.1,200 vehicles a week. KIA anticipate 100,000 UK car sales target by 2020. Warba Bank’s CEO, Shaheen Hamed Al Ghanem, said this acquisition was one of the best risks mitigated real estate investment of the bank, generating a steady and secured return from unbreakable long lease. He elaborated that the investment plan for 2017 is highly ambitious and the bank is looking for more international real estate investment opportunities in USA, UK and other continental European countries.

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