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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.

#Indonesia plans to relax bank #merger rule in efficiency push

Indonesia is planning further steps to make it easier for foreign banks to invest in local lenders as well as encourage domestic mergers. The Financial Services Authority, known as OJK, expects to amend the so-called single presence policy. The revised rule would relax the requirement that the acquiring banks have to merge all their local operations into one entity. Removing the single presence rule could make it easier for Standard Chartered to hang on to its 45% stake in PT Bank Permata. A large bank acquiring a smaller rival would be allowed to retain it as a separate entity without specifying the threshold for a merger requirement. However, even as the single presence rule is relaxed, foreign banks looking to acquire Indonesian lenders should still appoint Indonesian residents as president director and president commissioner.

QCB plans centralised Sharia’h framework for Islamic banks

Qatar Central Bank (QCB) is preparing to establish a centralised Sharia’h supervisory in Sharia’h governance. Currently, the Sharia’h governance structure of Islamic banks is mostly decentralised. Individual banks have their own Shaira’h Supervisory Boards to oversee their operations and ensure their compliance with the Islamic principles. The establishment of a centralised Sharia’h supervisory body will help achieve greater market-wide consistency and credibility. Qatar’s Islamic banks have registered a Compound Annual Growth Rate of 10.3% since the segregation of Islamic business from the conventional banks back in 2012. Conventional banks lag behind at 9.8% annualized growth during the same period.

IIRA reaffirms credit ratings of Al Baraka Banking Grp, upgrades its Fiduciary Score to highest among Islamic financial institutions in region

Islamic International Rating Agency (IIRA) has reaffirmed the international scale credit ratings assigned to Al Baraka Banking Group (ABG) at BBB+ / A3 . IIRA also reaffirmed the national scale ratings of ABG at A+ (bh) / A2 (bh) with a Stable outlook. The Group’s fiduciary score has also been raised to the higher level of “81-85”, the highest among the Islamic Financial Institutions in the region. IIRA recognized the substantial contribution of the Group’s four key subsidiary banks based in Turkey, Jordan, Egypt and Algeria. Moreover, IIRA said that the Group benefits from a wide geographic diversification with most jurisdictions possessing a low economic correlation, thereby improving the overall risk metrics.

Bahrain Islamic Bank Swiftly Ready to Launch Open Banking Services

Bahrain Islamic Bank (BisB) announced the launch of open banking services starting from 1st of July 2019. This is the result of the Central Bank of Bahrain (CBB) and its directive to integrate all retail banks in the Kingdom with FinTech companies. The open banking services features two types of services. The Account Information Service grants customers access to their bank account data from different banks through a single unified platform. The second service entails transfers between different accounts through a single application. According to BisB CEO Hassan Jarrar, Open Banking is a game changer, offering new online payment channels without the need for credit cards or debit cards.

MIDF keeps mum on Al Rajhi #merger talks

Malaysian Industrial Development Finance (MIDF) remains tight-lipped about its negotiations with Al Rajhi Banking and Investment Corp (Al Rajhi Malaysia). Both banking groups announced on Jan 10 this year that Bank Negara Malaysia’s approval had been secured to commence talks on a potential merger. However, both parties failed to reach an agreement past the March deadline. The companies then requested for an extension and were given another three months, up to June 27 this year. A merger of the two banks would result in a combined banking group with RM13.17 billion in assets. The merger with Al Rajhi Malaysia will allow MIDF to become an Islamic financial institution as it currently does not have an Islamic banking licence. MIDF brought in RM76.86 million in revenue and RM12.11 million in net profit for 1Q19.

Noor Bank raises over Dhs500m for Azimut’s fixed maturity fund

Noor Bank entered a successful collaboration with Azimut (DIFC) to launch the largest US-dollar Islamic fixed maturity plan (FMP) in the UAE under a Dubai International Financial Centre (DIFC) domiciliation. Raising Dhs507 million in subscriptions within two weeks of its launch, the FMP that will mature in four years is set to provide an income of 5% per annum through investing in sukuk portfolio. Noor Bank began operations in Dubai in 2008 as an Islamic financial institution. Azimut is Italy’s leading independent asset manager (active since 1989). The parent company Azimut Holding was listed on the Italian stock exchange on 7 July 2004 (AZM.MI) and, among others, is a member of the main Italian index FTSE MIB.

Banks' lending activity remains robust

According to CIMB Group Holdings group CEO Tengku Datuk Seri Zafrul Aziz, banks are doing as much as they can to balance lending to customers with responsible financing. He said commercial banks would want to grow their loans to maximise returns, but that must always be balanced against the banks’ risk metrics. To promote financial inclusivity, CIMB Bank Bhd and CIMB Islamic Bank Bhd have set aside at least RM12bil for the B40 group to access to facilities such as home, automotive, Amanah Saham Bumiputra and personal financing from 2019 to 2020. CIMB Bank and CIMB Islamic’s are assisting the B40 segment via the lowest-in-market financing rate of 2.9% per annum, under Bank Negara’s RM1bil Fund for Affordable Homes, to help those in the B40 group buy their first residential property. Based on data from Bank Negara, the industry’s loan growth rebounded slightly to 4.6% year-on-year in May from 4.5% in April, ending a five-month downtrend.

#Kuwait's Warba Bank plans $500 mln #sukuk issue this year - CEO

Kuwait's Warba Bank is working to set up a sukuk programme of up to $2 billion with an initial $500 million issuance this year. CEO Shaheen Al-Ghanem said the programme is subject to central bank approval. After the initial issuance this year, the rest would be issued over the next few years as needed and the proceeds used to finance operational matters. Ghanem added that the bank was looking to start a new asset management business this year aimed at overseeing about $500 million in investments within the next three years. Its launch is awaiting final approval from the Kuwait Capital Markets authority. The bank is looking to increase its total assets to over 3.5 billion Kuwaiti dinars ($11.52 billion) by 2022 from 2.59 billion dinars. Additionally, the bank is competing to lead a 350 million Kuwaiti dinar ($1.15 billion) loan for Kuwait Petroleum Corporation (KPC) that will likely involve multiple banks.

UAE lender ADCB plans to cut 2,000 jobs post-merger: Bloomberg

Abu Dhabi Commercial Bank (ADCB) is planning to slash about 2,000 jobs in the near future. In May ADCB, Union National Bank (UNB), and Al Hilal Bank merged to create the UAE’s third largest bank with 423 billion dirhams ($115 billion) in assets. Before the merger, the three banks employed about 8,500 people. ADCB started laying off employees once it began the merger with the two other banks. While the new entity retained the name ADCB, UNB was delisted and dissolved as a legal entity. Meanwhile, Al Hilal Bank retains its existing identity and continues to operate as a separate Islamic bank within the ADCB Group.

#Malaysia’s MIDF, Al Rajhi Bank #merger hangs in balance

The planned merger of Malaysian Industrial Development Finance (MIDF) and Al Rajhi Banking and Investment Corp (Al Rajhi Malaysia) is now uncertain as the shareholders have missed the June 27 deadline. The shareholders of the two companies have sent a request to Bank Negara Malaysia (BNM) seeking more time to further negotiate the merger plan. In March 2019, BNM had already granted three months’ additional time for the proposed merger. Al Rajhi Bank is likely to stay on as a shareholder in the proposed merged entity while PNB would remain its largest shareholder. After the completion of this merger process, MIDF is expected to become an Islamic bank. The merger plan, if it succeeds, would lead to a financial services entity with a combined asset value of MYR 14.09 billion.

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.

Bank Muamalat to grow revenue from Islamic pawnbroking

Bank Muamalat Malaysia aims to grow its revenue from Islamic pawnbroking (Ar-Rahnu) by up to RM50million. The bank's second pawnbroking campaign was launched on June 20 and will run for 10 months until March next year. Bank Muamalat consumer banking division head Zury Rahimee Zainal Abiden said the bank aims to tap the interest of up to 50,000 people in comparison to only 27,000 during the previous campaign period. Throughout this campaign, Bank Muamalat is offering a one kilogramme gold wafer as the main prize, 100 gramme gold wafer for the second prize and 50 gramme gold wafer for the third prize. Bank Muamalat is also offering a prize of a gold wafer on a monthly basis for more than 200 selected customers throughout this campaign period. From the first campaign the bank recorded up to RM26.9million of revenue from the gold business with an average of 2,700 new accounts every months. Bank Muamalat has more than 1.2 million customers and this segment of the business contributed 8% to the group earnings.

Why a second #merger wave may hit #UAE lenders

According to Bloomberg Intelligence, banks in the United Arab Emirates may go through a second wave of consolidation as lenders seek to improve profitability. Bloomberg analyst Edmond Christou said the absence of common shareholders and a lack of cross-Emirate deals have so far hindered transactions. Abu Dhabi Islamic Bank and Commercial Bank International are among lenders that have under-performed in some areas and could benefit from commercially driven mergers. Most bank mergers in the UAE have so far been driven by common shareholders, making it easier for deals to be completed. Dubai Islamic Bank approved a plan this week to proceed with the acquisition of smaller rival Noor Bank, both of which are controlled by Dubai’s main holding company.

Dubai Islamic Bank board approves plan to acquire Noor Bank

Dubai Islamic Bank (DIB)’s board has approved its acquisition of lender Noor Bank to create one of the largest Islamic banks in the world with combined assets of nearly Dhs275bn. Following the completion of the deal, Noor Bank’s operations will be integrated and consolidated within DIB. The new size and scale will allow DIB to expedite its strategy to expand across the far east, sub-continent, and east Africa with Dubai as the hub. The UAE is seeing a wave of consolidations in the market as banks seek to increase capital due to slowing economic growth. Three of Abu Dhabi’s banks are currently in the midst of a merger. That follows the combination of National Bank of Abu Dhabi and First Gulf Bank in 2017 to create a lender with $175bn of assets.

Maybank Islamic wants to link up Gulf Cooperation Council with Asean

Maybank Islamic wants to be the bridge for the Islamic banking sector between the Gulf Cooperation Council (GCC) and the ASEAN region. CEO Datuk Mohamed Rafique Merican expressed confidence that the company would be able to play the role in facilitating the trade, as well as flow of funds for financial activities between the two regions. Last year, MIB announced that it might receive regulatory approvals to set up its Dubai branch in the first half of 2019. Maybank Islamic has strong footprints in Islamic finance, particularly in Malaysia, Indonesia and Singapore. Being the largest Islamic bank in Malaysia, Maybank Islamic has about RM225 billion worth of assets as at Dec 31, 2018 (FY18). Its total gross financing for FY18 advanced 8.1% year-on-year to RM176.8 billion and its Islamic financing contributed 58.7% to the group's total financing.

#Qatar- QIIB stays focused on digitalisation, utilising #fintech: CEO

Qatar International Islamic Bank (QIIB) remains focused on digitalisation and utilising financial technology. Bank CEO Dr Abdulbasit Ahmad al-Shaibei sees fintech as the future of banking. QIIB cannot afford to miss out, so it is looking closely at the blockchain technology and ways to partner with fintech companies. The bank is investing significantly in the IT infrastructure and considers Cyber security a top priority. Al-Shaibei plans the opening of new branches at commercial malls across the nation as a natural response to the urban development and customer needs. QIIB is a major stakeholder in Umnia Bank in Morocco, where it has not rolled out all banking products, it is currently going through the regulatory procedures. Umnia Bank is a joint venture among QIIB, Credit immobilier et hotelier and the Moroccan Deposit and Management Fund.

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.

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.

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