IslamicFinance.de

Aston Martin's indebted majority owner has won the backing of sufficient creditors to proceed with a fresh debt restructuring plan – using the British luxury carmaker as collateral – ahead of a planned seven-year asset disposal program. Investment Dar's proposed restructuring received the minimum required backing of at least 13 per cent of creditors, but did not exceed the 56 per cent maximum that the company would allow.

Nigeria and other African countries need to tap into opportunities provided by Islamic financing to fund infrastructure development on the continent, Sanusi Lamido Sanusi, the governor of the Central Bank of Nigeria has said. He stated this yesterday in Abuja at a conference on “Infrastructure Development through Alternative Funding (Islamic Finance) in Africa”. He said Sukuk, if well developed, could serve as a financing option for governments as is already evident in countries like Saudi Arabia and United Arab Emirates. The acting managing director of Jaiz Bank, Usman Hassan, urged the federal government to conclude the development of the framework for the issuance of Sukuk in the country. This is necessary because with Sukuk you cannot have failed projects and funds cannot be diverted.

The General Council for Islamic Banks and Financial Institutions (CIBAFI), a Bahrain-based non-profit organisation, plans to expand beyond the Gulf, so that it can shape rules and practices in new markets as they grow. Addressing a major weakness in Islamic finance, the lack of well-trained professionals, CIBAFI plans to expand its training and certification programmes. The body also plans to hold forums in new markets for Islamic finance, including events in Morocco and Libya later this year. One of CIBAFI's key messages is that Islamic windows need to operate under clear rules to improve the perceptions of consumers. Therefore, Omar Hafiz, secretary-general of the body, said that for its long-term health, the industry should focus as much on improving the regulatory environment as increasing its size.

The General Council for Islamic Banks and Financial Institutions (CIBAFI), a non-profit organisation, has traditionally focused on neighbouring countries, which form a core market for the industry. The Bahrain-based association now plans to expand beyond the Gulf, so that it can shape rules and practices in new markets as they grow. Addressing the lack of well-trained professionals in Islamic finance, CIBAFI plans to expand its training and certification programmes. The body also plans to hold forums in new markets for Islamic finance, including events in Morocco and Libya later this year. One of CIBAFI's key messages is that Islamic windows need to operate under clear rules to improve the perceptions of consumers. CIBAFI has 114 member institutions, including Egypt's Faisal Islamic Bank, Kuwait Finance House and Bahrain-based Al Baraka Banking Group.

Thuraya Telecommunications Company has secured a term financing facility through Dubai Islamic Bank (DIB). Thuraya will use the proceeds to upgrade its network infrastructure and to support further development and expansion of its product portfolio, including the highly successful Thuraya SatSleeve satellite adaptor for smartphones. According to Samer Halawi, Chief Executive Officer of Thuraya, this long-term relationship with DIB will help his company to strengthen its position as a leading MSS operator and provide it with additional financial flexibility to develop its next generation gateway and upgrade its network capacity. It also provides Thuraya with the breadth that supports its sustainable growth strategy as well as new business opportunities in key and emerging markets.

Kuwait Finance House (KFH) has launched the first version of a Quran Application for android users. Strategy and Corporate Affairs General Manager Fahad Al-Mukhaizeem said that KFH is keen to grant this gift since Ramadan is approaching. Moreover, Al-Mukhaizeem explained that this service sheds lights on the meanings of the Quran, and helps reciters in memorizing it. He revealed that the number of users is expected to reach 2 million users by the end of the year, after launching the current version that will be constantly updated through Play Store. It is worth noting that the new version has high resolution, in addition to features like night reading. Furthermore, the application will include many meanings in English, Arabic, French, and Turkish, not to mention the feature that allows users to listen to the Quran. Features also include choosing the colours that the reader wishes to see.

The United Nations Environment Programme Finance Initiative (UNEP FI) has elected its two new Co-Chairs to steer the initiative and to champion its revised motto: Changing finance, financing change. David Pitt-Watson, Senior Strategic Advisor and Representative of Inflection Point Capital Management, and Madeleine Ronquest, Head of Environmental and Social Risk Management at FirstRand Group Ltd., will co-chair the UNEP FI Global Steering Committee for the next two years. The Committee is composed of 15 elected members who focus on climate change, ecosystem management, and social issues. UNEP FI's upcoming two-day Global Roundtable (GRT), to be held on the 12-13 November in Beijing China, will focus on long-term decision-making and the fundamental role of finance in society.

Kuwait's Investment Dar Co has asked creditors to take a 50% writedown on its debt, as it seeks to meet repayments after defaulting on a loan three years ago. Under the optional plan, creditors will receive a cash payment totaling 5.7% of their outstanding debt and a portion of a new Islamic loan equal to about 44% of their current exposure. Details are not public. Investment Dar's stake in Aston Martin and real estate holdings will be among assets backing the new credit facility.

Thuraya Telecommunications has secured a long-term financing facility through Dubai Islamic Bank (DIB). Thuraya said it will use the proceeds to upgrade its network infrastructure and to support further development and expansion of its product portfolio, including a SatSleeve satellite adaptor for smartphones. Adnan Chilwan, deputy chief executive officer of DIB said in a written statement that the deal makes DIB the preferred partner for fuelling the growth of progressive companies like Thuraya.

Fitch Ratings has affirmed the Islamic Development Bank's (IDB) Long-term Issuer Default Rating (IDR) at 'AAA' with a Stable Outlook and Short-term IDR at 'F1+'. IDB's ratings are underpinned by strong intrinsic features, primarily excellent capitalisation. The ratio of equity to assets has remained above 60% since inception. The ratio of debt to equity is low, at 57.5%. The bank also maintains a comfortable level of liquid assets, which more than fully covered its short-term liabilities. Moreover, credit risk is moderate. Fitch deems other risks like credit risk on treasury assets, interest rate risk and foreign exchange risk as well as the bank's risk on equity investments under control. Shareholders' support is also supportive of the rating since their willingness to support the bank is expected to remain strong.

Investment Dar has become overextended in the global financial crisis and its complex debt restructuring has dragged on for four years. The indebted Kuwaiti shareholder of ASTON MARTIN has offered a new debt restructuring deal to creditors, using its shares in the British luxury car brand as collateral. Under the plan, creditors of Kuwait’s Investment Dar will be given the option of becoming lenders to Oasis Holding (a Jersey-registered 'special purpose vehicle', SPV) while taking a 50 percent discount on what they are owed. The private equity group’s 24 per cent stake in Aston Martin and its 28 per cent stake in affiliate Asmar, which also holds shares in Aston Martin, will be among assets to be shifted across to the SPV. Altogether, Kuwaiti investors own 60.5 per cent of Aston Martin.

Kuwait Finance House (KFH said its 20 percent capital increase had been oversubscribed by shareholders, without providing specific details. The bank was raising 319 million dinars ($1.12 billion) from the sale of 639 million new shares at 0.5 dinars each - a 35.9 percent discount to the closing price at the start of June, when the offer period was announced. The share sale, which ran for two weeks from June 5, will boost KFH's paid-up capital by 64 million dinars and would fund the bank's expansion and strengthen its balance sheet. The sale will push the bank's Tier 1 ratio towards its 17 percent target for the end of 2013. It currently stands at 13.6 percent, below the 15.5 percent average for the Kuwait banking sector. The capital increase is part of the bank's five-year strategic plan, with shareholders giving assent to the move in April.

Bankers, businessmen and economic experts urged masses to adopt Sharia-based banking and insurance in their need of daily lives and businesses. Speaking at the Second Islamic Financial Expo and Conference (IFEC) held at local hotel on Thursday, they enlightened participants about the potential of Islamic banking, hereafter underlining the need of awareness and penetration of Islamic banking and Takaful services across the country. Islamic banks are very active in introducing different products to the customers which not only meet their demands at commercial and domestic levels but also fulfill Sharia principles. However, there are loopholes in the Islamic banking industry which must be addressed mutually by banks, regulator and the government.

A majority of high net worth individuals (HNWIs) in the Middle East believe wealth creation is faster today than in the past, according to the latest report of Barclays Wealth Insights. Over half (60%) of respondents in the Middle East agreed that wealth can be created faster today than in the past, in comparison to 43 per cent in Europe and 31 per cent in North America. Interestingly, more than half (54%) of Middle Eastern respondents stated that personal investments have contributed largely to their overall wealth portfolio, compared to other sources of income such as inheritance at 49 per cent. In terms of how this wealth is used, HNWIs in the Middle East have a tendency to allocate more of their resources to personal property than to tangible assets and collectibles. Many HNWIs around the world now prefer to give their money to family and friends and charitable causes in their lifetime rather than as inheritance, the report revealed.

Tunisia has won $1.2 billion in funding from the Islamic Development Bank (IDB), aimed at backing industrial, agricultural and trade projects. The IDB funding line will include loans and grants, and will be for three years, with disbursements of $400 million each year until 2015. The IDB has also given Tunisia a financial guarantee to issue a sukuk worth $600 million before 2014. Tunis is also in talks with Qatar about the Gulf state making a deposit at the Tunisian central bank with easy conditions. The assassination in February of opposition politician Chokri Belaid triggered the worst street violence since the revolution. Elections expected towards the end of this year will create fresh uncertainty. The state budget deficit is expected to rise to around 5.9 percent of gross domestic product this year from 5.1 percent last year.

Tunisia's fledgling Islamic finance industry could take a 25 to 40 percent share of the country's financial sector in five years' time if necessary rules, consumer education and private investment plans materialize, according to a Thomson Reuters study. Currently, sharia-compliant business accounts for just 2.5 percent of the Tunisian financial sector. The study estimates that Islamic financial assets in Tunisia could reach $17.8-$28.5 billion by 2018, up from $1.4 billion at present. Some industry practices that are controversial among some Islamic scholars, like tawarruq or commodity murabaha, are generally being avoided in Tunisia, the study found. One boost for Islamic finance in Tunisia would be issuance of the country's first sukuk, which the government is planning. Islamic Development Bank (IDB) has given Tunisia a financial guarantee to issue a sukuk worth $600 million. Last week, the IDB extended said it would extend $1.2 billion in funding to Tunisia for industrial, agricultural and trade projects.

Dubai Exports , the export promotion agency of the Department of Economic Development (DED), recently showcased the emirate's expertise and resources in Islamic economic services to the business community in Toronto and Vancouver across a series of seminars. The seminars, jointly organised by Dubai Exports and Borden Ladner Gervais LLP focussed on encouraging linkages between Islamic financial and advisory firms in Dubai and their counterparts in Canada. Participants in the seminar also discussed the changes required in Canada's taxation and regulatory system regarding Islamic financial products. Opportunities are especially seen in the connection of the sophisticated financial and business communities in Dubai with leading edge Canadian technology companies and entrepreneurs in such areas as clean tech, life sciences, advanced materials and information technology, which are all shari'a compliant.

In Sudan, Sharia-compliant microfinance is the government-mandated rule, not the exception. That’s because the country’s banking system went fully Islamic in the 1980s, legislating Sharia principles. In 2007, the Central Bank of Sudan established a dedicated microfinance unit to foster a conducive policy environment, a regulatory framework, and the intellectual, human, and financial capital to provide those services effectively. Moreover, the Central Bank introduced various Shariah-compliant products, such as musharaka, mudaraba, salam financing and istisna, to meet specific needs of potential customers. Banks were required to channel at least 12% of their total loan portfolio toward microfinance clients. Out of this have emerged several exciting programs that are offering early evidence that the country’s strategy is paying off.

Algeria hopes to stem high unemployment rates among its young population by promoting the development of micro, small and medium sized enterprises (MSMEs). Key to that effort, of course, is the provision of financial services. Therefore, the Algerian government set out to make a Sharia-compliant product available that is both affordable and scalable. In collaboration with several national and international institutions the Algerian Ministry for Industry, piloted one such product in the Ghardaia region of Algeria. Four years later, this musharaka product has provided new opportunities for 167 MSMEs. Given the success of this product, musharaka is now available through Al Baraka branches nationwide. The bank is also working with its nationwide branches to test other Sharia-compliant products, including, murabaha and qard hassan as well as Sharia-compliant micro-insurance products.

A U.S. judge Tuesday approved Arcapita Bank B.S.C.'s plan to gradually liquidate itself in a process that conforms with Islamic Shariah law, which generally prohibits borrowing money with interest. The Bahrain-based investment firm entered bankruptcy protection last year with a goal of restructuring itself but ended up with a plan to orderly liquidate its private-equity investments. The modified proposal solved several concerns from creditors, including creating a new entity that will retain the firm’s management, and setting a minimum valuation for the company’s remaining assets. Arcapita manages infrastructure, real-estate, private-equity and venture-capital investments that are compliant with Shariah.