UK

British International Campaign to Attract Islamic Investments

The UK's Department of International Trade has announced the launch of a wide-ranging campaign in the Middle East and the Gulf to encourage investment in the UK. London is considered the largest market for Islamic finance outside the Islamic world and has more than 20 banks providing Islamic financial services. According to the Dubai-based Media and Communications Center, Britain ranks 22nd out of 124 countries in the world that use Islamic banking, placing it first in Europe and fourth among non-Muslim majority countries after Singapore, Sri Lanka and South Africa. Supportive government policies created a tax and regulatory framework aimed at expanding the Islamic finance market, including the elimination of double taxation, the extension of Islamic mortgage tax and the reform of debt arrangements. The United Kingdom is the first sovereign Western country to issue sovereign sukuk. In September, London also hosted the fourth annual meeting of the Global Islamic Finance and Investment Group (GIFIG) to discuss inter-state cooperation.

#UK Firm Launches Sharia-Compliant Home #Insurance

Green Dome Financial Services has launched the UK's first Sharia-compliant home insurance policy. The company has begun selling policies that meet Islamic restrictions on uncertainty and usury, or unreasonably high interest rates, while falling within the scope of the U.K.’s Financial Conduct Authority.

BEP Systems to deliver Gatehouse Bank’s residential financing processes

BEP Systems has added Gatehouse Bank to its roster of financiers using their customisable Apprivo2 system. Gatehouse Bank will use the new system to help make their business more efficient. For Gatehouse Bank, BEP have re-configured their systems to comply with Shariah requirements when dealing with home purchase plans. Charles Haresnape, CEO of Gatehouse Bank, said it was vital that the software house understood Shariah requirements and BEP Systems delivered excellent solutions across home purchase plans and buy-to-let financing. Chris Little, managing director of BEP Systems, said Gatehouse Bank had seen the advantages Apprivo2 and strategic advantages would be delivered to fit their business model. He added that Apprivo2 was the fastest growing system in the UK serving specialist finance providers.

Dana Gas says appeal against BlackRock joining #sukuk trial rejected

The English Court of Appeal has refused Dana Gas' appeal against fund manager BlackRock to participate in English court proceedings. Dana is refusing to redeem its $700 million outstanding sukuk on the grounds that they are no longer sharia-compliant and therefore unlawful in the United Arab Emirates. Courts in both Britain and the UAE are hearing the case. On November 17 the English High Court ruled in favour of the sukuk holders. Dana plans to set aside this judgement on the grounds that the company was not permitted to represent itself in court. Regardless of the result of that application, additional legal proceedings in England are expected.

Dana Gas says #UAE court allows it to appeal British #sukuk ruling

Dana Gas announced it will appeal against a British court’s ruling on its $700 million sukuk, after a UAE court lifted an injunction preventing it from participating in the British proceedings. Dana previously said the sukuk was invalid under UAE law and refused to repay holders of the sukuk which matured at the end of October. The energy producer sought a declaration on the sukuk’s lawfulness at courts in the UAE and Britain. Last month, a British court ruled in favour of Dana creditors, deciding the purchase undertaking was valid and enforceable. Dana has said it aimed to appeal against the ruling because it could not take part in proceedings. A hearing in Sharjah on the validity of the sukuk under UAE law is scheduled for Dec. 25.

Dana Gas seen returning to table after London ruling

Dana Gas plans to appeal the UK court ruling on $700mn of its outstanding sukuk. According to Dana Gas, the decision by the London court is flawed because the UAE-based company was barred from participating in the proceedings due to an injunction at home. Judge George Leggatt said the English law contracts are enforceable in the case. Dana was challenging a provision called purchase undertaking, which allowed the trustee on behalf of investors to force Dana to buy them out of the agreement at par. Dana shares fell as much as 5.6% on the Abu Dhabi stock market on Sunday. The court ruling puts investors one step closer to resolving a dispute over the sukuk that highlighted one of the Islamic finance industry’s weak spots.

Dubai investors digest implications for #sukuk market after Dana Gas ruling

A High Court judge in London ruled in favour of creditors in a case regarding the validity of the purchase undertaking for about $700 million of sukuk issued by Dana Gas. The idea that Dana Gas has been able to assert for the past five months that its own sukuk were non-sharia-compliant has struck many observers as unusual. Judge George Leggatt said that Dana Gas' challenges to the validity and enforceability of the purchase undertaking were unfounded and declared the purchase undertaking for Dana's sukuk as valid and enforceable.

'We've been badly served by banks': the small firms seeking #ethical #banking

Dave Fishwick, the founder of Burnley Savings and Loans, put millions of pounds behind the belief that there’s a demand for ethical banking. He aims to link local savers with small and medium-sized enterprises (SMEs) in need of finance, run by a locally based bank manager who makes lending decisions based on deep personal knowledge, rather than an algorithm. Fishwick believes that ethical banks are needed: small, simple, honest banks run by the community to serve the community. While SMEs often can’t get loans from major banks, Conrad Ford, CEO of Funding Options, notes that a wave of challenger banks are offering help. They include Metro Bank, Civilised Bank and Greater London Mutual, all with an emphasis on integration with a defined community or locality.

Dana Gas shares fall 4.17% on London #sukuk ruling

Dana Gas share prices fell 4.17% following Friday’s English High Court ruling against Dana Gas and in favour of bondholders. Danas said it plans to appeal the decision by the London court that declared the company’s $700 million sukuk valid and enforceable. Friday’s ruling was made in Dana Gas’s absence from the court. Dana Gas had earlier refused to repay debt owed to investors for two mudaraba sukuk worth $350 million each. The latest ruling does not mean that Dana Gas has to pay bondholders just yet, with another hearing in a UAE court scheduled for December 25.

Shepherd and Wedderburn secures Islamic finance deal

Shepherd and Wedderburn has completed the Shariah-compliant refinancing of high-value office accommodation in Aberdeen. The properties, which total 159,170 sq ft of floor space, are fully let to the oil and gas service provider Petrofac as its North Sea office headquarters and NHS Scotland. The funding was completed by way of a commodity murabaha facility from an established international bank. Peter Alderdice, a senior associate at Shepherd and Wedderburn, said the team was pleased to have used its expertise in Islamic finance to help secure the refinancing of two of the largest commercial properties in the city.

English court rules in favour of Dana Gas bondholders in key Islamic bond case

An English High Court judge has ruled in favour of Dana Gas’s bondholders, reported the Financial Times.

More details at the source.

CEO of Al Rayan Bank receives OBE from Prince William

The CEO of Al Rayan Bank, Sultan Choudhury, has received his Order of the British Empire (OBE) from Prince William. Choudhury was appointed OBE in the Birthday Honours of Queen Elizabeth II, in recognition of his services to Islamic finance. Choudhury was part of the management team that obtained Western Europe’s first authorised Islamic banking licence in 2004. He has since grown the Bank to become the UK’s largest Islamic bank. Al Rayan Bank offers the largest Sharia compliant product range in the UK. The Bank currently has more than more than 80,000 customers throughout the UK, more than a quarter of which it estimates to be non-Muslim.

#Saudi Co. Liable For $668M In Back Rent Tied To #Sukuk Bond

Financial services company Saad has been ordered to pay around $668 million to Citicorp Trustee Company and Golden Belt Sukuk Company. Saad's obligations are tied to sukuk bond and linked to the leasing of land in Saudi Arabia. The judgment was handed down Friday in London's High Court, where Judge Peter Macdonald Eggers ordered Saad to honour its obligations.

Gatehouse Bank names new BDM

Gatehouse Bank has expanded its residential property finance team with the appointment of Mehwish Mirza as its business development manager for residential home finance. Mehwish has joined the specialist bank from Together, where she was also a business development manager and held the same role for seven years at Al Rayan Bank. She will be working across the North of England and Wales, having previously provided residential Sharia-compliant finance in the North West while at Al Rayan. The appointment comes on the back of Gatehouse hiring Sim Gill and Mehraj Bari to its residential property finance team as part of its expansion into the sector.

British judge to issue ruling on $700 million Dana Gas #sukuk case soon

British High Court judge George Leggatt said that he would not further adjourn a trial in the Dana Gas case and would issue a judgement soon. Dana is claiming it does not need to redeem its $700 million sukuk, which matured at the end of last month, because the instruments became invalid under UAE law. Dana had asked for further postponement of the trial pending developments in a UAE court, where motions in the case have also been filed.

When money meets religion: Sharia compliant #pensions in the #UK

Pension schemes are increasingly attempting to understand their members' preferences. Exclusion policies over so-called sin stocks, such as alcohol and tobacco, is on the rise across the UK. The need for sharia-accommodating pensions is likely to grow. The UK’s Muslim population reached 2.8m in 2011, according to the last census. The biggest challenge associated with sharia compliance relates to its policies on investments, but sukuk can take the place of conventional debt instruments. Christine Hallett, CEO of Carey Pensions UK, which administers the Islamic Pension Trust, says sukuk is currently too expensive for the workplace DC default charge cap of 0.75%. The industry is faced with a circular problem. Lack of demand limits the range of mature markets sharia funds can invest in. Maria Nazarova-Doyle, head of JLT Employee Benefits, sees a current absence of demand for sharia pensions, but adds that sharia considerations are becoming more prominent.

#UK savers struggling to make money should consider Islamic banks

Islamic banks are becoming increasingly popular with non-Muslim savers due to their attractive rates and their ethical principles. In the UK, Islamic banks come under the same governance as high street branches and other private banks, offering the same statutory protections under the Financial Services Compensation Scheme (FSCS). This scheme means savers get their money back if a bank or building society goes bust, although there is a cap of £85,000 per lender. According to Robert Parker, founder of Holborn Assets, with Islamic finance profit schemes, after-tax return needs to be compared between schemes to judge potential before making decisions on return rates alone. Islamic banks offer competitive rates, although savers will have to be prepared to tie up their money for at least a year to access the best deals.

#Britain plans new #sukuk deal; Brexit may boost Islamic finance

Britain plans to reissue Islamic bonds in 2019 in a sign the country’s exit from the European Union may accelerate plans to develop the Islamic finance industry. In 2014, Britain became the first Western country to issue sukuk, raising £200mil (RM1.125bil). A spokesperson of the Treasury assured that the UK was committed to ensuring the future success of the sector. Brexit could threaten London’s dominance as a financial centre. A Reuters survey showed around 10,000 finance jobs may shift out of Britain or be created overseas in the next few years because of Brexit, with Frankfurt and Paris benefiting most. According to Bilal Khan, partner at Islamic finance consultancy Dome Advisory, Brexit has increased the government’s interest in Islamic finance. Because of Brexit, the UK is keen to build economic links with non-EU countries. He said a second sovereign sukuk issue by Britain might be expanded to raise as much as £1bil.

#Sukuk market great hope may never recover from Dana

Dana Gas is an independent natural gas supplier based in Sharjah. Its dispute with investors is now making its way not only through UAE courts, but through English courts as well. Dana’s gone so far down the road to avoid its debt repayments that the affair could easily scare international investors away from the sector. The fallout can be seen in the new issue market. While sovereign sales are carrying on, the broader corporate and financials market in the Middle East has been awaiting resolution of this dispute. In June Dana claimed that its $700mn outstanding sukuk were non-compliant with Shariah law and the money it paid out to holders of the bonds should be returned. Bondholders objected and suggested an immediate payment of half of the $700mn face amount outstanding and the due date for the balance extended for three years. The case is now disputed in Sharjah and London, where it stays until October 12, to allow court proceedings in Sharjah to conclude.

Bondholders push back on Dana Gas #sukuk invalidation claims in London court

Dana Gas sought to have US$700 million worth of Islamic bonds declared unlawful so it could avoid repaying its investors. The bondholder group, led by Blackrock, demanded in court that Dana Gas repays millions of pounds, or hand over stock in a subsidiary that runs its operations in Egypt. It also wanted the court to ban Dana Gas from issuing any new sukuk. The courtroom battle is notable for the absence of Dana Gas, which has been prevented from taking part because of an injunction in the UAE. Any prospect of an early conclusion has been disputed by Dana Gas, which has claimed that litigation could continue in the UAE and could last up to ten years. The trial in London, which is expected to last up to two weeks, is due to hear evidence from the former general counsel of Dana Gas.

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