IslamicFinance.de

Dana Gas has no plans to repay the two mudaraba sukuk of $350 million in size each due Oct. 31. The company shocked the Islamic finance industry when it said it no longer considered its sukuk Shariah-compliant. The missed payment will be the second time in five years the company fails to settle bonds at maturity. In June Dana Gas offered to replace the existing sukuk with four-year bonds that pay less than half the current rate. It retracted that offer in July, adding that it will seek a court-driven solution. A UAE injunction has barred Dana Gas from taking part in the trial in London, but British judge George Leggatt will hand down a ruling on the 13th of November.

Ibdar Bank is directing its FinTech strategies to position the bank as a fully-digitised Islamic investment bank. The Bank has USD277 million in paid up capital and a geographical reach that spans the GCC and Middle East North Africa Turkey (MENAT) region. The Bank also transacts in Southeast Asia and select developed markets. Ibdar Bank has significant expertise in areas including aviation, infrastructure, maritime, oil & gas, and real estate. According to CEO Ayman Sejiny, Ibdar has set out a comprehensive plan in 2018 for its engagement with global Fintech service providers. In the first phase, the bank is set to digitise its operations internally, the second phase will focus on implementing its service offerings in response to the needs of a Global Islamic Digitised Economy (GIDE). Sejiny added that the Central Bank of Bahrain has taken decisive steps towards a FinTech supportive environment in order to facilitate the growth of the sector.

Bank of Whittier, a community bank in Los Angeles, offers Shariah-compliant products and is one of few institutions specialized in Islamic finance in the United States. The bank, whose staffers speak more than a dozen languages, markets itself to observant Muslim entrepreneurs. Deals are structured so that the bank buys into the venture with the entrepreneur, who runs the company and buys the bank out, with payments structured so that the bank is compensated for its investment. Profits and losses are shared; the overall cost tracks with a traditional loan repayment at a standard interest rate.

At least five years later than initially supposed, Saudi Arabian and Malaysian Islamic finance experts start again their efforts to create common regulations for scholars. Together with its Middle Eastern counterpart, the Malaysian International Shariah Research Academy for Islamic Finance has started its work on guidelines which will be targeted at the number of boards on which scholars can sit to reduce conflicts of interest. Also, an institution aiming to provide global accreditation will be established. Thus, the industry's need to boost confidence and improve transparency can be met.

Gross domestic product can expand by 1 percent to 2 percent more than the central bank’s March forecast of 4.5 percent to 5.5 percent, Najib told the Foreign Correspondents Association in Singapore yesterday. Measures including developing the Islamic finance industry will aid growth, he said, adding that the government will probably sell Shariah-compliant global bonds denominated in dollars.

The International Islamic Financial Market, the Bahrain-based organization seeking to set standards for Islamic securities, may issue new global guidelines to facilitate the sale of Shariah-compliant bonds, an official at the industry body said.

The following borrowers are expected to sell Islamic bonds, which use asset returns to pay investors to comply with the religion’s ban on paying interest:

CAGAMAS BHD
LEBANON
WAHA CAPITAL PJSC
KUVEYT TURK KATILIM BANKASI AS
SAUDI ARABIAN OIL CO
LAFARGE MALAYAN CEMENT BHD
QATAR ISLAMIC BANK SAQ
PAKISTAN
TAIBA HOLDING CO
THAILAND
DEVELOPMENT BANK OF KAZAKHSTAN
KHAZANAH NASIONAL BHD

Saudi Arabian Oil Co. or Aramco, the world’s biggest crude producer, and Total SA hired Deutsche Bank AG, Samba Financial Group and Calyon to sell and manage the mainly domestic bond sale, to help fund the construction of a $12 billion oil refinery.

Sales of Islamic bonds may increase 24 percent this year, led by Southeast Asia, as the region’s expansion helps drag the world out of recession, said CIMB Group Holdings Bhd., the leading arranger of such issuance.