Islamic finance set to unleash the power of social investment

Source: Gulf Times

third Global Islamic Economy Summit (GIES) to be held in Dubai on October 11 and 12 will set a special focus on new forms of Islamic investments and the utilisation of Islamic funds for social and entrepreneurial development. One particularly interesting plenary session will deal with the issue of Islamic charity funds or trusts (waqf) created by philanthropic giving in Muslim communities which experts say remain an underused social development instrument, even a “sleeping giant” in Islamic finance. These funds, in fact, contain significant assets, estimated by some to exceed a value...

Islamic finance to take over conventional system in many countries

Source: Pak Observer

Growth prospects for the Islamic banking and finance (IBF) sector are still strong despite subdued sukuk issuance predicted for 2016, Moody’s Investors Service said in a report. According to report, growth in the Islamic banking sector continues to broadly outpace that of conventional banks in most systems in which Islamic banks have been established. The current size of the Islamic finance market has been estimated to range from $1.66 trillion to $2.1 trillion with expectations of market size to be $3.4 trillion by end of 2018. Based on $1.66 trillion, Islamic...

Islamic Finance as a Tool of Chinese Financial Diplomacy

Source: Islamic Finance

With only roughly 20 million Muslims in China, it is not surprising that Islamic finance has not taken off in China. Recently, however, some Chinese companies have expressed interest in tapping into offshore pools of Islamic funds. For example, HNA Group, a mainland Chinese firm that owns Hainan airlines, is reportedly considering Islamic financing options for its proposed US$ 150 million acquisition of ships as well as a large offering of offshore Sukuk (Islamic bonds). Another example is that of Country Garden, a Guangdong-based property developer, which issued a Malaysian Ringgit...

Cagamas bags award at the Global Islamic Finance Awards 2016

Source: Zawya

Kuala Lumpur, Malaysia, 5 October 2016 – Cagamas Berhad (Cagamas), the National Mortgage Corporation of Malaysia was awarded the Islamic Finance Advocacy Award (Institutional) 2016 at the Global Islamic Finance Awards (GIFA) ceremony held in Jakarta, Indonesia. The award was presented to Mr. Chung Chee Leong, Chief Executive Officer, who accepted the award on behalf of Cagamas Kuala Lumpur, Malaysia, 5 October 2016 – Cagamas Berhad (Cagamas), the National Mortgage Corporation of Malaysia was awarded the Islamic Finance Advocacy Award (Institutional) 2016 at the Global Islamic...

SBP moves to boost Islamic finance

Source: Tribune

The State Bank of Pakistan (SBP) has amended its regulations to exempt Islamic banks from using interest-based benchmarks for some of their financing products, the latest government step aimed at boosting Islamic finance. Despite a direct ban on charging interest, interest-based benchmarks are used as a pricing reference by a majority of Islamic banks, due in part to the absence of stable and widely-published alternatives. In a circular, the SBP said Islamic finance institutions would have to outline their alternative pricing mechanism...

Saudi Arabia Bank Deposits Turn Negative

Source: The Finance

The Saudi Arabian Monetary Agency (SAMA) injected SAR20bn (USD5.3bn) into the banking system via time deposits, and also introduced 7 day and 28 day repurchase agreements in support of more monetary policy tools to support the economy. This comes after the 3 month Saudi Interbank Offered Rate has jumped by over 200% since July 2015 to the highest level since 2009 (currently at 2.35% from below 1% in July-2015). RHB Note – We believe this action may indicate further calls to stabilise rates, not only in combating a liquidity crunch, but also ahead of the US Federal Reserve FOMC meeting. This will put some...

Islamic finance an alternative to conventional financial system?

Source: Brecorder

Shaikh Mufti Taqi Usmani chairman Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) said on Monday that Islamic finance as an alternative of conventional is not the right approach. While, addressing as keynote speaker at World Islamic Finance Forum, organized by Institute of Business Administration (IBA) and Center for Excellence in Islamic Finance (CEIF) he said that the people of country also want the government to implement Islam in all aspects Shaikh Mufti Taqi Usmani chairman Accounting and Auditing Organization...

What makes Islamic finance different?

Source: The Medium

Approximately 25 students attended the evening event, where 15 were students from business-related programs. Khan has an MBA in Islamic banking and finance from the International Islamic University of Malaysia, and a Bachelor’s in information technology from York University. When Khan was in Malaysia, he worked as a research analyst and trainer for the Kuwait Finance House, which is one of the largest Islamic banks in the world. Currently, Khan is working with the Islamic Finance Advisory Board, which is a non-profit organization based in Mississauga. Khan helps promote Islamic finance...

Malaysia in Islamic finance, a catalyst for ESG

Source: Pak Observer

Ratings sees Malaysia’s leadership in Islamic finance as a catalyst for environmental, social and governance (ESG)-driven investment. Recently RAM was among the featured voices in the international research paper, Investor Obligations and Duties in Six Asian Markets, jointly published by Principles for Responsible Investment, the United Nations Environment Programme Finance Initiative and The Generation Foundation. The report also took into account the views of key institutions in Malaysia, such as Bursa Malaysia and the Employees Provident Fund, as well as other market players...

Sukuk Market Developments in Asia for Q216

Source: The Islamic Finance

In Southeast Asia, total G3 currency bond issues (bonds issued in US dollars, yen and euros) were valued at USD23.3 billion over the January–July period, down 15.1% from the same period in the previous year. Indonesia posted USD11.1 billion worth of G3 issuance, of which about 63% comprised sovereign G3 currency bond sales and about 32% was USD-denominated foreign exchange bills issued by the central bank. Malaysia’s issuance of USD3.8 billion, reflecting a 51.0% y-o-y decline, largely came from the USD1.5 billion dual-tranche, USD-denominated sukuk sale of the central government...

Turkey’s SMEs Prosper Through Islamic Financing

Source: The World Bank

Hakan Altinay is one of Turkey’s first aerospace engineers, the first person in the country to build a robot, and a successful businessman in the high-tech industry. He’s also a devout Muslim, so when he was searching for a loan in order to expand his enterprise in Turkey’s financial capital, Istanbul, it was important that he find one that didn’t conflict with his religion. “If you look at it as a faith-based value, then using Islamic funding eases your conscience,” says Altinay, explaining how he’d sought out and settled on a $50,000 loan approved under Islamic Law...

CIBAFI and World Bank bring Islamic finance stakeholders

Source: Zawya

Manama, Kingdom of Bahrain | The General Council for Islamic Banks and Financial Institutions (CIBAFI), the global umbrella of Islamic financial institutions and the World Bank Group are pleased to announce the 2nd edition of a joint international conference on Corporate Governance of Islamic Financial Institutions: “Overcoming Challenges and Implementing Best Practices”, which is due to take place in Islamabad, Pakistan on 15th November 2016. The one day conference, which is held under the patronage of the State Bank of Pakistan, aims to bring together various stakeholders from the private...

Saudi-based Apicorp arranges $100 mln Islamic financing for Egypt's EGPC

Source: Reuters

Saudi Arabia-based Arab Petroleum Investments Corp (APICORP) has arranged a three-year $100 million murabaha financing facility for Egyptian General Petroleum Corporation (EGPC), the development bank said on Wednesday. EGPC will use the funds to purchase liquid petroleum gas from the Arab Maritime Petroleum Transport Company, the statement said. A murabaha is a cost-plus-profit arrangement which complies with Islamic finance standards Saudi Arabia-based Arab Petroleum Investments Corp (APICORP) has arranged a three-year $100 million murabaha financing facility for Egyptian...

IDB Prize for Women’s Contribution to Development

Source: The Finance

The Islamic Development Bank (IDB) is an international financial institution with a membership of 57 countries spreading across different continents and regions. Its mission is to promote comprehensive human development, with a focus on the priority areas of alleviating poverty, improving health, promoting education, improving governance and prospering the people. Recognizing women as central to achieving human development, the Bank includes the empowerment of women within its strategic framework...

Global Islamic finance to touch $6.5tr by 2020

Source: Pak Observer

The volume expanded from a meagre $150 billion in 1990 to $1.8 trillion in 2015, the board reported. “Asia is expected to be the key driver in advancing the growth of Islamic finance industry,” says the International Financial Services Board (IFSB) Report-2015. “Pakistan is among the potential leaders of Islamic finance,” it says. Citing these exciting statistics regarding the expansion of Islamic finance, Ashraf Mahmood Wathra, Governor, State Bank of Pakistan (SBP), the central bank, reported this to the inaugural session of the World Islamic Financial (WIF) Forum 2016...

Global spending on Islamic food, lifestyle to hit $3 trillion

Source: Tribune

Global spending on Islamic food and lifestyle is projected to hit $3 trillion in five years as the Islamic finance sector, which has assets currently worth $2 trillion, is poised to touch $3.3 trillion by 2021 on the back of growing awareness about its product offerings. According to Khaleej Times, the Dubai Islamic Economy Development Centre in its ‘State of the Global Islamic Economy Report’ prepared in partnership with Thomson Reuters and DinarStandard estimates that global Muslim spending on food and beverages is expected to reach $1.9 trillion by 2021. The report’s findings...

Global Islamic Finance Awards 2016

Source: Zawya

Edbiz Consulting organised 6th Global Islamic Finance Awards (GIFA) at Fairmont Hotel, Jakarta, on September 29. President Joko Widodo was the guest of honour and received the prestigious Global Islamic Finance Leadership Award 2016 for his championship role in promoting Islamic banking and finance in Indonesia. “There are only a few leaders in the Muslim world, who have shown 100% commitment to providing Islamic banking and finance a level playing field in their respective countries, and President Jokowi is one of them,” said Professor Humayon Dar, Chairman of GIFA...

Slowdown in Islamic finance to run into 2017

Source: Business Recorder

The slowdown in Islamic finance growth is likely to continue through 2017 due to low oil prices and lack of regulation, Standard and Poor's Global Ratings said Monday. The asset growth of Islamic banks fell to seven percent last year from 12 percent in 2014 when oil prices began to decline, the ratings agency said in a report. "We think this slowdown will persist in 2016 and 2017 with growth stabilising at around five percent. Lower oil prices mean lower liquidity at Islamic and conventional banks in core markets...

Saudi's STC says unified licence positive for business

Source: Reuters

Saudi Telecom Co said on Sunday a decision by Saudi Arabia's government to provide it and other telecommunications operators with "unified licences" would provide positive opportunities for the company across its business. However, the company said it was too early to determine the financial impact. The Capital Market Authority on Sunday suspended trade in shares of the kingdom's listed telecommunications operators after the government decided to extend their licences. In addition, the government said it would provide the firms with "unified licences" allowing them to...

Tax waiver needed to boost Islamic finance

Source: The Jakarta Post

A tax waiver is needed, especially on asset transfers, to make Islamic financing in Indonesia more competitive with conventional financing, a practitioner has said. The structure of Islamic financing requires that assets be transferred to a third party, usually a special purpose vehicle (SPV), during the lending period, before being transferred back to the lender after the loan repayment. The value-added tax applied to the transaction creates an instance of double taxation and makes the Islamic financing, especially for housing and infrastructure loans, less competitive with conventional financing...

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