IslamicFinance.de

The possibility of the first sovereign or corporate sukuk origination out of France took a step nearer when the French government announced that it had passed new instructions to facilitate the introduction of sukuk, Ijara, Murabaha and Istisna products in France.

It is claimed that France now has a tax neutrality regime in place for facilitating Islamic financial products including Islamic bonds and certificates; cost-plus-financing; leasing and construction industry forward financing.

French banks such as Societe Generale, BNP Paribas, UBAF, Calyon (Banque Credit Agricole) have long been involved in global Islamic finance. BNP Paribas for instance recently listed its first Islamic exchange-traded fund (ETF) in Asia on Bursa Malaysia. Some two years ago it had advised the Malaysian Sovereign Wealth Fund, Khazanah Nasional Berhad, to launch its first Islamic ETF, MyETF i. The new measures are not limited to a particular transaction but form a basis for a framework for Murabaha, Istisna, Ijara and sukuk transactions which satisfy both French law and Shariah principles.

Ashurst acted as counsel to the Islamic banks. The team was lead by managing partner of Ashurst's Abu Dhabi office, David Wadham, assisted by associate Faris Hadi. Denton Wilde Sapte (Neil Cuthbert) acted as counsel to Emirates Steel and Allen & Over (Bimal Desai) acted as common lenders' counsel to the banks.

Leading Islamic finance scholars are preparing the first global certification for Shariah experts, seeking to bolster the industry’s reputation and make it easier for banks to find qualified advisers. The International Shariah Research Academy for Islamic Finance in Kuala Lumpur will pick a board of regulators by year- end to issue permits for scholars qualified to sit on Shariah boards. The scholars decide whether financial products meet the religion’s precepts, including a ban on interest payments. Scholars are now required to have recognized university degrees before they can act as advisers to banks and companies. The council of scholars at the academy includes Sheikh Nizam Yaquby of Bahrain, Mohammad Daud Bakar of Malaysia and Abdul Sattar Abu Ghuddah of Syria. A centralized regulator for scholars will help increase investment because banks would save time in choosing experts to ensure products meet religious principles. The institution doesn’t plan to restrict scholars on the number of advisory panels they can join.

In 2010 Qatar Islamic Bank signed a Memorandum of Understanding with Banque Populaire Caisse d'Epargne, France's second largest banking group, in order to gain access to the French retail banking and small medium-size business markets. Recently, Paris Europlace signed an agreement with AAOIFI paving the way for greater cooperation to drive the development of Islamic finance in France.

Patrick Imam and Kangni Kpodar note that the 9/11 attack on the US ‘had a positive impact on assets of Islamic banks, perhaps because Muslim investors, who traditionally invested in the West, were compelled to keep more money at home for fear of expropriation.

The study said that while oil prices have a positive and statistically significant impact on the diffusion of Islamic banking, the effect is likely to be asymmetric. They found that the probability for Islamic banking to develop in a given country rises with the share of the Muslim population, income per capita, and whether the country is a net exporter of oil. Trading with the Middle East and economic stability also are conducive to diffusion of Islamic banking and proximity to Malaysia and Bahrain, the two Islamic financial centers, also matters.

The Solidarity Group Holding board has appointed of Ashraf Bseisu as group chief executive officer. Mr Bseisu is a long-standing Solidarity executive and a prominent member of the region's insurance industry. Solidarity Group Holding, one of the largest takaful companies in the world, includes the Solidarity Family Takaful Company and Solidarity General Takaful Company in Bahrain as well as subsidiaries and associates in Saudi Arabia, Jordan, Egypt, Malaysia and Luxembourg. Mr Bseisu is currently Bahrain Insurance Association chairman and the General Arab Insurance Federation vice-president. He has been with Solidarity since his appointment as general manager - finance and corporate management in July 2006 and has held several senior posts within the organisation. He has more than 20 years of experience in the insurance and financial services sector, where he held several executive positions.

Sovereign Islamic bonds from Asia to the Persian Gulf are lowering returns on corporate sukuk for the first time in three months.

Malaysia’s Lembaga Tabung Haji fund, France’s BNP Paribas Investment Partners and Duet Mena Ltd. in Dubai forecast government debt will outperform until property prices in the Persian Gulf recover from a slump that prompted credit-ratings companies to downgrade corporate bonds.

A leading economist says the practice of jailing debtors is morally wrong. In the rest of the world it is the banks’ responsibility to try to assess the credit worthiness of individuals. Prof Batchelor is trying to rebuild Dubai’s image. He thinks that Dubai could treat people who might have stayed and set up a business a little better. They shouldn’t be faced with the idea of going elsewhere in the world. Abdulfattah Sharaf, HSBC's head in the UAE, keeps his idea that jailing debtors remained an effective way for banks to retrieve bad loans.