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Tuesday, 25 September 2012

Words of Advice


"We find fault with the world, while the faults lie in our own selves." --- Imam al-Shafii r.a 

"If you make intense supplication (doa) and the timing of the answer is delayed, do not despair of it. His reply to you is guaranteed; but in the way He chooses, not the way you choose, and at the moment He desires, not the moment you desire." – Ibn Ata’Allah

"Do not use the sharpness of your speech on the mother who taught you how to speak." ~ Ali Ibn abi Talib (RA)

To Allah we belong, to Allah we will return. Turn to Allah before we return to Allah. 

Allah allows everything to happen for a reason. Circumstances will either direct you, correct you, protect you perfect you.

Not a lot of people know who we are but Allah does. He even knows whats in your heart. SO be aware of who you are trying to impress. 

Good manners is part of taqwa and you cannot have taqwa without good manners. - Ibn Rajab al-Hanbali

Do your best, pray for the best. Allah will take care of the rest.

HARAM is just one letter more than HARM. What is HARAM is HARMFUL.
Sufyan ibn ‘Uyainah said: "The intelligent person is not one who merely knows what is good and what is bad. The intelligent person is one who, when he sees what is good, follows it, and when he sees evil, shuns it." [Aboo Nu’aym, Hilyah Al-Awliyaa, Vol. 4, p.16]

Whoever does not find happiness in the dhikr (remembrance) of Allah, prayer, and reciting the Quran, he will not find it anywhere else! --- Hasan Al Basri

"Knowledge is like a fruit. When a fruit grows on a branch of a tree, its weight causes that branch to bend and bow. Similarly, when knowledge increases in a person, it causes him to become humble and not Mutakabbir (proud and boastful)."

"Every journey requires provisions, so let taqwa (piety) be your provision in the journey from the life in this world to the Hereafter." [Scholar: Umar ibn Abdil-Azeez]

Ibn Taymiyyah

"Allah has made lowering one's gaze and guarding one's modesty the strongest means of purifying one's soul". (Ibn Taymiyyah)

"Do not depend too much on anyone in this world because even your own shadow leaves you when you are in darkness." (Ibn Taymiyyah)

Ibn Al-Qayyim

“When the heart is nourished with dhikr (remembrance of Allah), its thirst quenched with contemplation and cleansed from corruption, it shall witness remarkable and wondrous matters and be inspired with wisdom.” (Ibn Al-Qayyim)
“Whenever Allah, the Exalted prevents His believing servant from something during this worldly life, He will bestow upon him something which is better and more useful to him. It should be noted that this is only granted to the believers.” (Ibn Al-Qayyim)

“The Prophet (peace be upon him) established a relationship between the fear of Allah and good character, because fearing Allah improves the relation between the servant and Allah, and good character improves the relation between a person and others. Therefore, fearing Allah makes it possible for Allah to love him, and good manners makes it possible for people to love that person.” (Ibn Al-Qayyim) 

If you are afraid of any creature, you will run away from it. When you are afraid of Allah, you will love Him and seek to be close to Him. (Ibn Al-Qayyim) 

"Deeds without sincerity are like a traveler who carries in his water-jug dirt. The carrying of it burdens him and it brings no benefit." (Ibn Al-Qayyim)

In order for a place to contain something, it must be free from whatever contradicts it. This principle applies to mankind and all creation as well as to belief and desires.  So, if the hearts is obsessed by belief in falsehood, there will be no place for truth.  Accordingly, if the tongue is involved in trivial discourse, one shall be incapable of useful speech, unless falsehood is abandoned.  (Ibn Al-Qayyim)
Stand firm against evil thoughts, for if you fail to do so, they will become ideas, if you do not, they will become desires, so fight against them. If you do not, they will become a form of determination and intention, if you do not resist, they will become actions, and if you do not follow them up with their opposite, they will become habits that will be hard to quit. (Ibn Al-Qayyim)
If you do not work hard and face difficulties along your way in seeking glory, you will never taste honor and relief when you attain victory. (Ibn Al-Qayyim)

"Whoever knows himself well, would keep himself busy reforming himself instead of talking about the faults of others...Whoever knows his Lord, would keep himself busy trying to please Him, instead of trying to please himself."-Ibn Al-Qayyim

Imam Shafi'e

"Knowledge is that which benefits you, not that which is memorised." - [Imam Shafi'e]

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UAE third in global sukuk

The GCC sukuk market has reached an “inflection point” in terms of new issuance, propelled by a fast growing appetite for infrastructure finance as the UAE emerged as the third global growth market for Islamic bonds, Standard & Poor’s said on Monday.
In the GCC, the UAE has become the second market for sukuk in the year to July with $5.3 billion. Saudi Arabia now leads the GCC ranks with $8.8 billion, replacing Qatar, which is currently in third with $4 billion. The kingdom is currently the second-largest global issuer behind Malaysia at $51.6 billion, after the government made moves to support Islamic finance.
“The GCC market crossed $19 billion in issuance as at July 2012, about the same as for all of 2011. Of that, infrastructure represented 30 per cent, compared with just seven per cent the previous year, said S&P credit analyst Karim Nassif. “The reasons for the surge are low yields, relatively high liquidity, large capital expenditure needs, and strong investor appetite,” he said at a media roundtable on Monday.
“We consider the market for Islamic infrastructure in Asia and the GCC to have reached an inflection point in terms of new issuance after a relative lull from 2009 to 2011. What’s more, we’ve seen the emergence of the first project finance sukuk within the infrastructure asset class,” said Nassif.
Total sukuk issued out of Asia reached $57.9 billion in July 2012, compared with $64.9 billion for all of last year. Malaysia is now the world leader in sukuk issuance. Political will, recognition of beneficial ownership, tax incentives, and a rising investor base have all supported the country’s continued growth trajectory.
Tapping the sukuk market could help improve the capital structure and liquidity profiles of GCC and Asian companies, particularly those operating in capital-intensive industries such as infrastructure, said Stuart Anderson, managing director and regional head for Middle East at S&P.
Sukuks could provide such companies the longer-term funding they need via a different funding source. This source is becoming more liquid as it reaches across border and becomes more global and grows in scale, Anderson said.
The ratings agency analysts observed GCC companies have been crossing the figurative border into Asia for infrastructure finance. Abu Dhabi National Energy Co and Bahrain-based Gulf Investment Corp are the first to issue sukuk in Malaysian ringgit.
“These types of cross-border deals are more than a smart funding solution, in our view. They could also develop the trade relationship between the countries of the GCC and Asia to their mutual benefit.
“But what is also compelling is that such transactions could be a bellwether for the further standardisation and globalisation of the Islamic finance market.”
They said such deals might signal the start of more cross-border transactions between the Gulf and Asia, which could help the market become more mature and truly global, and stimulate even more deals and trade between the two regions.
The global sukuk market is set to break the $100 billion mark this year, compared with issuance of $84.5 billion in 2011, but still represents about one per cent of the global bond market.
“We believe sentiment will remain positive this year despite economic soft spots in Europe, decelerating Chinese growth, and fallout from the Arab Spring. Sukuk growth is particularly healthy in the GCC and Asia,” they said.

(Khalejj Times / 25 Sep 2012)

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Oman: alizz islamic bank eyes 20 per cent market share in five years

Muscat: alizz islamic bank, which opened its RO40 million initial public offering on Saturday, is targeting to capture a 20 per cent market share in Islamic banking business and a 3.5 per cent of total banking assets in Oman within five years. 

The promoters of the bank are confident of a robust growth in demand for Islamic banking products due to several favourable factors like an unmet demand for Islamic banking services, low banking penetration levels, experience of stakeholders in Islamic banking, high level of (72 per cent of Omanis) bankable population, favourable economic policies and strong economic performance.

Growth in Islamic banking has outstripped conventional banking growth across Gulf Cooperation Council (GCC) markets and is now valued at around $300 billion by asset value. The promoters are confident that Oman will experience a similar growth in its new Islamic banking market and that alizz islamic bank is uniquely placed to become a market leader. 

"The Islamic banking assets constitute 26 per cent of total banking assets in the GCC region. Barring the UAE, growth of Islamic banks was much higher than conventional banks,- Jamal Darwiche, chief operating officer (designate) of alizz islamic bank, said, while addressing a press conference here yesterday.

The bank is committed to delivering comprehensive commercial and retail banking solutions to the people of Oman. It intends to roll out an innovative suite of Sharia-compliant products, delivered to market-leading standards and supported by exceptional customer service. The bank is also confident of making profit in the second year of operation.

Darwiche said the bank has identified a high quality commercial space in the financial district for headquarters and the flagship branch. The bank will see the feasibility of opening more branches in the coming months. 

alizz islamic bank is offering 40 per cent of its paid up capital equivalent to 400 million shares, each priced at 102 baisas, to Omanis and non-Omani investors. There are two categories of applicants -” the first category is those who subscribe between 1,000 and 100,000 shares and the second category is those who subscribe between 100,100 and 10 per cent of the share offer. 

"It has a strong underwriting back-up from leading Omani institutions, which gives us great comfort,- added Abdullah Al Hinai, Deputy General Manager -” Investment Banking & Financial Institutions, bank muscat. The issue, which is lead managed by bank muscat, is fully underwritten by bank muscat, ahli bank, BankDhofar, Bank Sohar, The Financial Corporation, United Securities and Gulf Baader Capital Markets. 

The promoters have already contributed RO61.2 million, representing 60 per cent of the paid up capital of RO100 million. The issue will close subscription on October 21. 

The bank is promoted by local and regional investors, who have a successful track record in Islamic banking and financial services. The promoters are Huriah Company (10 per cent), aabar Investments (20 per cent), First Energy Oman (15 per cent) and Tasameem Real Estate Company (15 per cent). 

Addressing the media, Ahmed Alkhonji of Huriah Company, said; "The large unmet demand for Islamic banking means that alizz islamic bank is uniquely placed to become a market leader for banking products. We are delighted to have aabar, First Energy Bank and Tasameem as our partners and the bank will benefit immensely from their considerable international experience.- 

Elaborating on the progress achieved by the promoters in launching operation so far, Darwiche said; "We have done few steps that keeps us on track to launch the bank operations.- The business model has been finalised and promoters' committee has also been constituted. 

The members of the promoters' committee, which is overseeing the formation of the bank, include Yeshwant Desai, a former CEO of bank muscat, Mohammed Badawy Al Husseiny, CEO of aabar Investments and Mohammed Ghanem, Acting CEO of Fist Energy Bank. 

(Times Of Oman / 24 Sep 2012)

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Ghana: Local SMEs Want Islamic Banks to Boost Business

Despite the policy by Bank of Ghana (BoG) not to license Islamic Banks to operate in the country, there are good reasons for the central bank to permit these no-interest-on-loans financial institutions, for which some players in the Small and Medium Enterprises (SMEs) sector and experts are urging BoG to rescind its decision.
Since the early 2000s, BoG has refused to give licences to Islamic Banks that approached it to do business in the country. Some attributed the central bank's stance to persistent lobbying by the commercial banks which stand to lose when Islamic Banks operate in Ghana.
Under the Islamic system of banking, a borrower only needs to repay the amount owed to the bank. The borrower can also choose to pay the lender a small amount of money to serve as a gratuity. Since Islamic Banks were introduced in Nigeria, many SMEs have been boosted with accessible and affordable credit. Several individuals have also accessed credit from these banks.
Now, in Ghana, some owners of SMEs, who will enjoy the interest-free credit facilities that Islamic Banks offer to expand their businesses, have renewed their calls on BoG to back down on its entrenched position and legalise the operations of these banks. And their calls have been supported by some forward-looking bankers and experts. One such expert is a financial analyst, John Gatsi, who has asked BoG to reconsider its policy and allow the introduction of Islamic Banking as happens in Nigeria. John Gatsi told Accra-based CitiFM that "interest rates are high and cost of doing business is also high and the cost of borrowing is not the best hence the call for the introduction of Islamic banking where there will be no interests."
Mr Gatsi said many people are calling for the introduction of Islamic Banking in the country as an alternative to the high interests charged by the commercial banks. He noted, however, that there are several obstacles which may affect the introduction of Islamic Banking because "you cannot introduce a new banking system into the conventional system without allowing the Central Bank to lenience the operations of such businesses. So as at the now, the Central Bank is not having any discussions with respect to Islamic banking."
He said there are advantages for financial intermediation when Islamic banking is introduced. "If you look at what the Muslims tell us, it means that without the presence of Islamic banking in the country, savings mobilization is hugely affected because there are a lot of Muslims based on their faith who do not have any dealings with the banking system even though they engage in productive economic activities", Mr. Gatsi said. Mr Gatsi urged the Muslim community in the country to set the tone for this discussion although they are doing a lot of underground work "but they need to bring the discussion to the national level."
Another expert who supports Islamic Banking is the Managing Director of Zenith Bank Ghana, Mr Daniel Asiedu. Mr Asiedu has revealed that Islamic Banking may be introduced to the public in future."If it is a product that has done well in other economies, why not, maybe it could do well." He stated that when it is convenient, Zenith Bank would introduce the interest-free banking in Ghana.

(All Africa / 24 Sep 2012)

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Malaysia Leads Way in Islamic Finance

Malaysia’s claims to being in the forefront of the internationalization of Islamic finance have been further strengthened by the attention given to the Global International Financial Forum (GIFF) held in Kuala Lumpur last week.

The third such gathering organized by the Bank Negara, it attracted not merely practitioners, academics and Islamic scholars discussing often highly technical subjects but Ali Babacan, the deputy prime minister of Turkey and a man who played a crucial role in the revival and modernization of Turkey’s economy after its 2001 crisis. 

Even after 10 years of government by a moderate Islamist party headed by Erdogan, only some 5 percent of Turkish financial assets are in the Islamic sector but the country recently made a significant contribution to the international sukuk (Islamic bond) market when it made a US$1.5 billion issue.

Turkey, out of deference to the state’s secular philosophy, does not even call its non-conventional system Islamic but refers to it as “participation” finance. It is a moot point whether this makes it more attractive to non-Muslims or less appealing to devout Muslims but it does attempt to get across the claimed benefit of Islamic finance, that borrower and lender share in what profits or losses emerge.

The engagement of Turkey, the most developed and democratic large Muslim-majority nation in the international Islamic finance arena, must give hope to those promoters who fear that the growth of the movement has been almost entirely due to the large surpluses of the oil rich Gulf states helped along by a Malaysia which has been the leader in developing a regulatory system and in providing consistent and timely interpretations of shariah law which can be applied to new issues and instruments.

In addition to Turkey, other important recent breakthroughs for sukuk market development include an issue by South Africa and issues denominated in non-dollar currencies, including the Singapore dollar and Chinese yuan. Kazkhastan has done a US dollar issue and even Ireland is considering one. Longer maturities are also now possible With oil rich Muslim countries still flush with cash, demand for sukuks appear to exceed supply and sukuk issues tied to specific projects are being promoted as a way to encourage issues by developing countries for infrastructure development.

Nonetheless it remains the case that this is a market in which the main issuer is Malaysia itself, which now accounts for over 50 percent of global outstanding issuance with Gulf countries accounting for most of the rest. To a large extent Malaysian buyers and issuers are captives – issuers being the Malaysian government or government-linked companies and buyers often being local pension and other funds. 

Malaysian issues do attract foreign interest, especially from the Gulf, and for now at least Malaysia’s stable currency and strong foreign reserves enable it to allow free trading of ringgit paper and hence promote the internationalization of the sukuk market. Total outstanding ringgit bonds are expected to top RM100 billion by the end of this year of which 60 percent are sukuk.

The role of Islamic products in Malaysia has been rising steadily and now account for about 22 percent of the overall financial system. But that success may be due partly to active encouragement – there is no official discrimination in favor of Islamic finance but Bank Negara is naturally keen to see its baby prosper – and partly to the ease with which major banks including the likes of HSBC are able to run parallel conventional and Islamic products. Thus many non-Muslims now also use Islamic banking and insurance vehicles.

Its expertise and training systems have made Malaysia the Asian center for international banks such as Citibank and HSBC from which to conduct their regional Islamic banking. However, though Islamic finance is likely to continue to grow faster than conventional finance it remains small on the global scale. 

Indeed, the biggest single Islamic finance system is found in Iran which accounts for 39 percent of the global total but is largely cut off from the outside world by sanctions. It seems that even in the world of Islamic brotherhood, the diktats of New York prevail over financial dealings with the Islamic republic. 

Plenty of other problems remain in the broader world of Islamic finance. One is the difficulty of liquidity management and the need to link it to specific contracts such as a commodity trade. Another is the development of frameworks for dealing with insolvency. Yet another is the creation of genuine demand in populous Islamic countries such as Pakistan and Indonesia.

For many, both users of Islamic finance and skeptical outsiders, many Islamic finance products appear simply to ape conventional finance. They use complex formulae which purport at least to tie all financial transactions to actual trade or investment. Money itself is not traded. Many Muslims see it as insufficiently different or moral to be worth worrying about. Other Muslims worry that it is insufficiently distinct and failing to provide products, other than shariah compliant equities, which genuinely rather than notionally link risk to reward.

However, the promoters of it can reasonably claim that its rules do at least prevent aping of the derivative products which have cost conventional banking so dearly, particularly in the west. Computer-driven fast trading of equities is also outside the bounds of what is acceptable under shariah law. And with the Asian crisis and various Malaysian bank rescues in recent memory, Malaysia appears to be taking a firm regulatory line with its own Islamic bankers as well as conventional ones. 

Whether Islamic finance elsewhere will prove in any way superior remain to be seen. At worst the imprimatur ofshariah compliance could fool the faithful more easily than conventional. But even well-known mainstream economists such as former IMF chief economist Kenneth Rogoff believe in its principles of being rooted in real transactions as opposed to conventional finance which has become too clever by half. So its rise has a way to run – at least unless and until oil and gas prices collapse and Gulf demand dries up.

(Asia Sentinel / 24 Sep 2012)

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