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Thursday, 23 October 2014

Islamic finance & management events in Kuala Lumpur Malaysia in 2015




Date: 17-18 March 2015
Event: KL Conference on Islamic Finance
Event site: www.islamic-finance-conference.net

Date: 21-22 April 2015
Event: KL Conference on Islamic Wealth Management
Event site: www.islamic-wealth-management.net


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

Organizer: Alfalah Consulting
www.alfalahconsulting.com

Saudi Arabia's Advanced Petrochemical plans sukuk investor meetings

Saudi Arabia's Advanced Petrochemical Co. will begin meeting investors from Sunday ahead of a potential sale of a sukuk denominated in riyals, it said on Wednesday.
The pricing, tenor and size of the Islamic bond to be offered will be determined based on market conditions, Advanced said in a statement published on the kingdom's bourse.
Funds raised from the issue, to be arranged by HSBC Saudi Arabia and the investment banking arm of Riyad Bank , would be used for general business purposes, it added.
Should Advanced complete an issue, it would be a debut sukuk transaction from the petrochemicals firm.
In the past, Advanced has relied on bank loans, including Islamic equivalents, to fund itself; last year it raised 200 million riyals ($53.3 million) through a two-year murabaha, a common Islamic financing contract, for a housing project.
However, like many companies in the kingdom, it is turning to the debt capital markets to take advantage of high liquidity in the Saudi investor market which has made finance cheap, while the authorities have been encouraging firms to issue sukuk to diversify funding away from bank loans and develop the local debt market.

The company said on Sept. 4 it planned to invest in a project worth around $1 billion to produce propylene in South Korea. The joint venture with South Korea's SK Gas is due to start in the first half of 2016.
(Reuters / 22 October 2014)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Pakistan central bank to phase in new Islamic finance rules

Pakistan's central bank will phase in new capital adequacy rules for Islamic banking subsidiaries and trade sharia-compliant government debt in the open market, addressing a lack of liquidity management tools in the sector.
The initiatives are part of an ambitious five-year plan by the regulator to promote Islamic finance through an array of proposed legislative changes, product incentives and instructions to market participants.
In April, the central bank said it was working on such tools as part of efforts to ensure a level playing field for Islamic banks in the majority-Muslim nation.
The central bank has revised the minimum paid-up capital requirement for Islamic bank subsidiaries to 6 billion rupees ($58.4 million), giving them a five-year period to raise it. The minimum paid-up capital requirement required for all other banks is 10 billion rupees.
The move would encourage conventional banks to establish subsidiaries rather than operate Islamic windows, a practice that allows lenders to offer Islamic financial services provided client money is segregated from the rest of the bank.

In a separate circular, the central bank said it would trade government-issued Islamic bonds (sukuk) with Islamic banks on a competitive basis, serving as a money market instrument and a monetary policy tool.
(Reuters / 20 October 2014)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Wednesday, 22 October 2014

U.K. Dream of Becoming Islamic Hub Needs Corporate Assist

The U.K.’s ambition to become a global hub for Islamic finance, bolstered by a debut sovereign sukuk in June, needs corporate borrowers to take the baton.
There’s never been a publicly sold Islamic bond from a corporate in the country, according to data compiled by Bloomberg. The closest it has come was a $500 million issue by the Middle Eastern unit of London-based HSBC Holdings Plc in 2011. International Innovative Technologies Ltd., a clean energy company in Gateshead, privately placed the U.K.’s first corporate sukuk in 2010.
London is attempting to marry its status as one of the world’s financial hubs with an industry that’s poised to almost double in the four years through 2018 to be worth about $3.4 trillion, according to Ernst & Young LLP estimates. Even after the city’s former Lord Mayor, Roger Gifford, said Islamic finance should be as British as fish and chips, the U.K.’s debt office said in August it doesn’t have any current plans to sell further sukuk.
“We’re really looking for corporates to issue sukuk, to create a benchmark,” Farmida Bi, a London-based partner at law firm Norton Rose Fulbright, which advised Goldman Sachs Group Inc. on its debut sukuk sale, said by phone Oct. 9. The U.K.’s sukuk “was never just about fundraising for the government,” she said. “There’s definitely a desire to build the industry beyond the sukuk, to provide a framework.”

Corporate Catalyst

The U.K. sold Shariah-compliant notes maturing in July 2019 at a profit rate of 2.036 percent, receiving orders worth more than 10 times the 200 million pounds ($322 million) raised. The debt yielded 1.47 percent at 9:35 a.m. in London. The average rate of sukuk in the Middle East is 4.1 percent as of Oct. 17, according to JPMorgan Chase & Co. indexes.
“The demand seen for the U.K. sukuk should act as a catalyst for further issuances from the government or from U.K. corporates looking to access the liquidity in the Islamic market,” Humphrey Percy, London-based chief executive officer of the Bank of London and The Middle East, said by e-mail on Oct. 9. BLME is the largest Islamic bank in Europe, according to its website. “We welcome more participants here to further develop the market and increase its depth.”
The government will review its sukuk sale and consider how it can further develop its strategy for Islamic finance, Sarah Ellis, spokeswoman for the debt office, said in August. The office last week directed a request for comment to the Treasury, who didn’t respond to e-mailed questions.

‘Western Center’

A lack of issuance may not hold back the industry. The U.K. has six Shariah-compliant lenders, more than any European country, according to London-based Wayne Evans, a senior adviser of international strategy at TheCityUK, an independent company promoting financial services in the U.K.
The government last year set up an Islamic finance task force to cement London’s position as the leading “Western” center for Islamic finance, and TheCityUK was invited to be one of the practioner representatives, Evans said.
“Arguably, London already has this status,” Evans said by e-mail Oct. 16. Two London-based banks are among “the leading arrangers of global sukuk, around 25 law firms in the U.K. are supplying services in Islamic finance, and advisory services are provided by the largest four professional services companies,” he said.
Global Islamic bond sales jumped 16 percent so far this year to $37.2 billion, according to data compiled by Bloomberg. The U.K. was the first non-Muslim government to sell sovereign sukuk, and was followed by Hong Kong, South Africa and Luxembourg.
“There is energy, drive and focus on promoting Islamic finance across the economy,” Norton Rose’s Farmida Bi said. The government is “trying to make it clear to corporates that Islamic finance is a source of financing that they can tap into, it’s available,” she said.
(Bloomberg / 20 October 2014)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Malaysia: Muslim world needs to develop revolutionary method in Islamic finance

KUALA LUMPUR: The Muslim world needs to develop a revolutionary method in Islamic finance to allow entrepreneurs and financiers to leverage each other to contribute to the nation’s economic growth sustainability, Datuk Seri Najib Tun Razak said.

The prime minister said Islamic countries had made remarkable progress and became a significant group in the global economy as the total gross domestic products of the Organisation of Islamic Cooperation (OIC) countries had grown to US$9.4 trillion in 2012 from US$7.5 trillion.

The numbers showed that the Muslim world has limitless potential, he said in a keynote address at the Association of National Development Finance Institutions in Member Countries of the Islamic Development Bank (ADFIMI) – SME Bank International Forum 2014 here yesterday.

“The Muslim world through organisations, such as ADFIMI, must continue to emphasise that Islamic nations are peaceful sovereigns and a source of prosperity for the world.

“Our potential is enormous if we are organised and get our act together,” he said.

The prime minister said as an Islamic finance pioneer, Malaysia could and must play an influential role in ensuring the sector’s future development.

“Ten years ago, Malaysia issued the world’s sovereign sukuk.

Today, Islamic finance is a US$1.2 trillion market; this is expected to rise to US$2.6 trillion by 2017.

Islamic finance is now growing at 50 per cent faster than conventional banking,” he said.

Hence, Najib called on small medium enterprises (SMEs) to make greater inroads in Islamic finance as one of the fastest growing sectors in a crowded financial marketplace.

Najib drove home the point that there were some issues that needed to be rectified by the industry, such as regulatory hurdles, lack of consumer education and the need for more business-friendly policies.

In Malaysian context, he said, the government aimed to increase the SME macroeconomic contribution to 41 per cent of the GDP, 62 per cent of employment and 25 per cent of exports by 2020.

“This is a tall order, but I believe this is achievable and attainable,” he said
.
Najib noted that RM12 billion was spent for 157 SME development programmes last year that supported nearly 890,000 projects across all economic sectors.

He said that this year the spending rose to RM13 billion and almost half of the funds came from the private sector.

Present were Bank Negara Governor Tan Sri Dr Zeti Akhtar Aziz, Khazanah Nasional Bhd Deputy Chairman Tan Sri Nor Mohamed Yakcop, SME Bank Group Managing Director Datuk Mohd Radzif Mohd Yunus, and ADFIMI Chairman Mehmet Emin Ozcan.

(Borneo Post Online / 22 October 2014)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

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