Entries in English and Malay (Bahasa Melayu)

Saturday, 19 April 2014

Islamic finance & management events in Kuala Lumpur Malaysia in 2014

Date: 18-19 March 2014
Event: KL Conference on Islamic Wealth Management & Financial Planning
Event site:

Date: 22-23 April 2014
Event: KL Conference on Islamic Finance
Event site:

Date: 20-21 May 2014
Event: KL Conference on Shariah & Legal Aspects of Islamic Finance
Event site:

To register or reserve a seat online, please go to:

Organizer: Alfalah Consulting

Dubai Islamic Bank records Rs 211 million profit before tax

The Board of Directors of Dubai Islamic Bank Pakistan Limited (DIBPL) recently held a meeting to approve its financial statements for the year ended December 31, 2013. DIBPL is a fully owned subsidiary of Dubai Islamic Bank UAE, the world's first Islamic Bank. 

The year 2013 marked numerous achievements for DIBPL. On the financial side, the bank reported a year-end profit before provisioning of PKR 668 million and due to provisioning of PKR 456 million against non-performing Islamic Financing assets the bank now has a profit before tax of PKR 211 million. Furthermore, a 27 percent deposit growth was achieved in comparison to 2012, taking total deposits to PKR 68 billion in 2013. On the asset side, DIBPL's asset base rose by 26 percent in contrast to 2012 increasing the asset base to PKR 80 billion in 2013. The bank's investments grew substantially by 17 percent over the year, taking total investments to PKR 25 billion. 

From only 36 locations (36 branches) in October 2010, today DIBPL stands at 150 locations (125 branches and 25 branchless banking booths) in 40 cities across Pakistan. The bank added over 40,000 more customers in 2013, taking full customer base to over 140,000. As per the permission of State Bank of Pakistan, the bank is now to be considered MCR compliant. DIBPL enjoys a short-term credit rating of "A-1" and long-term credit rating of "A" with a "positive" outlook, indicating the bank's robust position in the industry. The bank continues to reaffirm its commitment to Pakistan with new branches and absolutely Halal and Sharia compliant new products and services. 

DIBPL intends to keep the momentum going for 2014 as well, aiming to take the branch network to 175 branches along with 50 branchless banking booths. This would enable an overall footprint of 225 outlets in 50 cities nation-wide. DIBPL continues to strive and expand its sphere of world class banking expertise in Retail, Corporate, Trade and Investment Banking services across Pakistan. 

The bank's endeavour since inception has been to provide a variety of unique and Sharia compliant products and services to all customers. In this respect, DIBPL has had first-mover advantage in a variety of banking services such as Banca Takaful, Branchless Banking and Cash Management Services. DIBPL is the first Islamic bank in Pakistan to offer Priority and Platinum Banking and the most extensive and innovative portfolio of Alternate Distribution Channels (ADCs) which includes VISA ATM/Debit Card, Internet Banking, SMS Banking, Phone Banking, Mobile Internet Banking, InterBank Fund Transfer and over 65 ATMs and CDMs across Pakistan.

(Business Recorder / 18 April 2014)
Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

This Islamic bank wants to get Britain building

BRITAIN could become the first truly global Islamic finance centre if the government sets its mind to attracting infrastructure investment, according to Gatehouse Bank’s chairman.
The sector holds plenty of promise – Fahed Faisal Boodai estimates the industry is worth $1.5 trillion, and the sector is growing at around 20 per cent per year.
Chancellor George Osborne is raising £200m with a sharia-compliant bond, a sukuk, and is trying to encourage investors to move to London.
Gatehouse Bank expects this bond issue to show the extent of pent up demand in Britain. The bank alone expects to buy £30m to £40m of the sukuk, and predicts bids for the debt to run into the billions of pounds.
But one sukuk is not enough by itself to bring a flood of Islamic investment into the wider UK.
In part the problem is finding investment opportunities which meet stringent sharia standards. This requires the return on investment to be based on a hard, tangible asset – for instance, a rental property, or industrial machinery.
This should be perfect for the British government which wants to find private investors to pump cash into infrastructure and construction.
But constantly shifting political aims mean it is difficult for investors to have any certainty of the long-term income flows from big projects.
“The UK is in the lead – support from the government puts Britain at the forefront, it is very good relative to other governments,” Boodai told City A.M.
But more certainty is needed if the government wants to unlock Islamic investment into infrastructure on the grand scale needed.
“We could invest in toll roads, in highways, in power generation, but only if the dynamics are right.”
“I have been at the UK embassy in Kuwait and Bahrain where UK Trade and Investment and the UK ambassador talk about it, but it takes so long to happen. We need a more proactive approach with an action plan and deadlines set, and you will see that commitment coming.”
But even the uncertainty of Britain’s policies will not stop the sector’s sustained growth, Boodai predicts.
Historic instability in the Middle East is one factor – for example, Kuwaitis sent increasing amounts of money abroad after the Iraqi invasion of 1990 hit the country’s wealthy hard.
And recent turmoil has also had an effect, with Boodai noting the Arab Spring has pushed investment into London.
As a result the bank yesterday opened a new office in Mayfair, giving its wealthy clients a West End base.
It comes as big banks sell off or slim down their own private banking arms, which has given the boutiques a chance to take on new customers.
“Since the financial crisis our clients are more interested in wealth preservation, and they want to know what they are buying,” Boodai said.
“The clients used to get reports from the big banks without a real relationship. Now there is an opportunity for banks that go back to the basics.”
On the other hand, that direct input from investors can create more work and difficulties for the bank.
When overseas investors put their money in London they often see prime property and other assets in the capital as the safest place for their funds.
If Gatehouse wants to invest elsewhere – 90 per cent of its UK projects are outside London – that means it has to try harder to convince the cautious backers.
“They see London is a strong city to preserve wealth, even in times of distress,” he said.
“We are trying to educate investors to move outside of London, and there should be an increased focus on encouraging them to put investment where it is needed around the UK.”
That could explain part of the reason Boodai is so keen for the government to push on with infrastructure development – guaranteed income streams are a lot easier to sell to customers.
“It has got to have the support of the government, we have to know the source of the cash flow.
(City A.M / 10 April 2014)
Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

Friday, 18 April 2014

GCC takaful industry set to stay on the path

Dubai: The takaful industry in the Gulf Cooperation Council (GCC) countries will maintain its growth path in the next five years, but competition, operational issues and lack of qualified talent continue to pose challenges, experts told Gulf News on Monday.
Takaful, an Islamic alternative to conventional insurance, has been growing at a double-digit rate and global premiums are forecast to expand from $4 billion (Dh14.7 billion) in 2007 to $20 billion in 2017. As of 2010, takaful premiums accounted for nearly half (43 per cent) of the GCC region’s composite premiums, compared to 31 per cent nearly a decade ago, or in 2005.
Industry experts who attended the 9th Annual World Takaful Conference (WTC 2014) in Dubai on Monday said the profitability of takaful companies has been threatened not just by competition but by the lack of a uniform regulation that will allow them to operate across different markets. The industry also needs to invest in qualified professionals that will help drive the takaful business forward.
Takaful operators are likely to continue to struggle in the next few years, although some will look at alternative customer segments and explore merger options. There is, however, potential for growth, especially in the area of family takaful and medical insurance in major markets like the UAE and Oman.
Speaking on the sidelines of the conference, Gautam Datta, chief executive officer of Al Madina Takaful, said the uptake of takaful products is still low compared to conventional insurance, as operators struggle to compete for bigger market share.
“They’re trying to balance the return on equity with the competition, with the volume [among other issues],” Datta told Gulf News. “What is required is focus and broad vision. The biggest challenge is the operational aspect of making it work. And that is not just a challenge for takaful but for any new entrant in the market.”
However, Datta said, the industry will continue to record double-digit growth in the short term. “The GCC takaful premiums as of 2012 were roughly about $1.7 billion if I take Saudi Arabia out,” he said. “The CAGR has been in the region of about 10 to 12 per cent and I think that would be maintained, if not increased, in the next few years because of the growth in medical in the UAE and Oman.”
Christian Gregorowicz, chief executive officer of Nextcare, said that with a price-driven market like the UAE, takaful companies need to rethink their strategies, come up with new products and strengthen their customer service to stand out, and if not, sustain their business.
“The industry is on a challenging path because it’s been trying to establish itself as an alternative to conventional [insurance],” Gregorowicz told Gulf News. “It’s facing tough competition on growing its market share and on making its profitability comparable to conventional industry.
“There is price competition, especially in the UAE. At the end of the day, everything is about price.”
Globally, the takaful sector is forecast to grow by 16 per cent annually in the coming years. David McLean, chief executive of WTC, said the projection indicates a ‘slight deceleration’ when compared to the average 22 per cent growth rate that the industry achieved between 2007 and 2011.
“Though the industry has achieved significant market share in its key markets, including the Kingdom of Saudi Arabia, Malaysia, Bahrain and the UAE, the acquisition of market share has not necessarily translated into sustainable profitability levels in many instances,” he said. “Financial performance, return on equity and the quality of growth remain key challenges for takaful operators in many markets.”
(Business Gneral / 18 April 2014)
Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

Some rich people fail to pay Zakat, scholars claim

If rich Saudi citizens had paid their Zakat (alms) regularly, there would not be a single poor family in the Kingdom, according to a number of Muslim scholars.

They told Makkah daily on Wednesday that there would be no poverty with the payment of Zakat, which is one of the pillars of Islam.

They noted that the number of the poor was increasing worldwide because of the world financial crisis and because of the greediness of businessmen who are monopolizing goods and commodities.

They said many wealthy people were not willing to reveal the size of their wealth because they were investing their money in bourses and investment companies.

Quoting statistical reports, the scholars said if Zakat was collected regularly it would lead to a turnover of more than SR60 billion a year.

According to Islamic law, all Muslims should pay annually 2.5 percent of their savings exceeding the cash value of 85 grams of gold as Zakat.

Zakat is also levied on gold, livestock, agricultural crops and other income at rates defined by the Shariah.

"If our wealthy men paid their Zakat in full, we will not have a single poor man in our country. Rather there will be a surplus of cash," said Saad Al-Otaibi, a member of the Supreme Judicial Institute.

He called for using accurate mechanisms to collect Zakat and said it must not be left as an option for wealthy people.

Al-Otaibi said many rich Saudis do not only abstain from paying Zakat but they do not also participate in any charity projects.

"You will only read their names in the lists of the richest people in the country," he added.

Ahmed Al-Mourie, a professor of the origins of religion at Umm Al-Qura University, said he was surprised that rich people would not pay Zakat, which is obligatory in Islam. "Wealthy people are not paying Zakat because they are greedy and have no fear of Allah," he said.

Al-Mourie said Zakat is a God-given right to the poor, so they should not be deprived of this.

Ali Al-Hakami, member of the Saudi Supreme Council of Scholars, said Zakat should be distributed in the country in which it was collected and, therefore, should not be sent to the poor in other countries.

He, however, said it is only permissible in extreme circumstances to send Zakat money to a nearby country if there are no poor people in the country where it is collected.

Mohammed Al-Suhaili, member of the National Society for Human Rights (NSHR), said the lack of rain in some Arab and Muslim countries was a punishment from God because they do not pay Zakat.

(Saudi Gazette / 17 April 2014)
Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

Latest Posts

Upcoming Events on Islamic Finance, Wealth Management, Business, Management, Motivational

Alfalah Consulting's facebook