Islamic Finance Today from Sri Lanka

imagesIslamic Finance Today (IFT), a quarterly magazine exclusively devoted to the Islamic Finance and Banking industry which is published in Sri Lanka has earned a top place among other leading Islamic financial publications worldwide.


A recent research report titled Islamic Finance and Economics as Reflected in Research and Publications by Dr.Nazim Ali of Harvard Law School, Massachusetts lists Islamic Finance Today (Sri Lanka) as one of six Popular Islamic Finance Journals, alongside others such as Islamic Banker (United Kingdom), Sharikah Islamic Business and Finance (Switzerland), Investor’s Magazine (Kuwait) and Business Islamica and Islamic Business & Finance (United Arab Emirates). IFT has also been cited as a primary source of information in Reports such as Islamic Finance 2009 compiled by Islamic Financial Services London (IFSL).


Islamic Finance Today is published by Pioneer Publications (Pvt) Ltd, a Sri Lankan-based publishing house and a subsidiary of the First Global Group, a conglomerate of companies involved in the field of Islamic Finance. The magazine which is presently in its second year of publication delivers to its discerning readership a mix of exclusive contributions on this very happening industry by a number of leading scholars and academics, interviews with leading personalities in the field and news, events and finance reports to keep readers updated on the latest developments in the industry.

 Source : sailanmuslim

Luxembourg Government announces a series of supportive measures for Islamic finance in Luxembourg

1ec7c846dd45d2beAt the Islamic finance conference held in Luxembourg on 5 and 6 May, Fernand Grulms, CEO of Luxembourg for Finance, passed on four messages from the Government. Speaking to a maximum capacity audience that included Islamic scholars and Islamic finance experts from Europe, the Middle East and Asia, Mr Grulms identified Islamic finance as a concept that is not limited to the Arab world but which has values in common with the socially responsible investment principles that are gaining popularity in western countries. In the “dense fog” that surrounds the immediate future of the financial sector, ethical and moral standards for investing “will inspire our actions of today and tomorrow”.Mr Grulms passed on four messages from the Minister of the Treasury and Budget, Luc Frieden:

The Luxembourg Government is convinced of the interesting development opportunities presented by Islamic finance. For this reason, in April 2008, Minister Frieden set up a working group bringing together the main interested parties in Islamic finance. The task of this working group is to look at potential obstacles hindering the development of Islamic finance, and ways that Islamic finance can be further developed, in Luxembourg.

The Government has asked the tax authorities to look into the characteristics of Islamic finance deals and come up with proposals to ensure tax neutrality of these transactions compared to traditional banking and financial transactions.

The Government is also examining to what extent Islamic financial products, such as Sukuk, could be used for funding purposes of the Government or entities belonging to the Government.

The Government supports the application by the Luxembourg Central Bank to become the first “non regional” associate member of the Islamic Financial Services Board, the international regulator of Islamic financial markets.

Source: abbl


Shares of most Islamic banks in GCC markets record spectacular rise


Ms Najat Al Soweidi, Chairman of the Arab Investment Company mentioned that according to latest AIC Research, share prices of most GCC-listed Islamic banks rose spectacularly over the last three months, particularly during the last six weeks. In this regard, Al Soweidi mentioned that AIC Total Return Index for GCC-listed Islamic banks (accessible on the Thomson Reuters service) shot from 455.8 points on the March 10, 2009 to 787.58 points on the May 10, ie a rise of about 73 percent over just the last sixty days. From a month-on-month perspective, which is over the thirty days from April 10 to May 10, the Index rose by about 33 percent.

AIC Chairman explained that all Islamic banks listed on the GCC exchanges, excluding two, recorded rises in share prices from of Feb 10 to May 10. Among the top advancers during that period were the Gulf Finance House shares which rose by 81 percent, the Al Jazira Bank shares by 73 percent, the Ithmaar Bank shares by 68 percent, the shares of Dubai Islamic Bank by 50 percent, and Sharjah Islamic Bank shares by 43 percent, while shares of Kuwait International Bank and Al-Rajhi Bank rose by 41 percent and 29 percent respectively. Worth noting is that the rise in share price of the remaining advancers among the GCC-listed Islamic banks averaged 10 percent.

Al Soweidi commented that these upward movements clearly reflect the start of stability and recovery in the GCC markets in the wake of the global subprime crisis, whose reverberations prompted GCC governmental and monetary authorities to launch remedial measures and adopt staunch monetary policies to reactivate their markets. Al Soweidi also noted that the rise in share prices of most GCC-listed Islamic banks surpassed the average rise in these markets, and attributed this to the fact that activities of Sharia Compliant financial institutions are based on exchange of actual assets, not on paper transactions, which makes them the first beneficiaries of improvement in market conditions.

Al Soweidi added “on these premises, AIC has established Al-Khaleejee Fund of GCC-listed Islamic banks in mid-February this year, but postponed its launch until recently to secure the highest possible profit for potential subscribers”.

On his part, Dr Farid Lian, AIC Senior Vice-President for Research and Business Development commented that the structuring and establishment of Al-Khaleejee Fund was preceded by extensive research, which spanned over a year and looked into the financial position of GCC-listed Islamic banks, leading to the development of an AIC proprietary index tracking the movements of these shares. Dr Lian added that the timing of Al-Khaleejee launch has been preceded by a thorough performance monitoring of the underlying shares, and reflects AIC relevant committees’ high expectation of solid profits for the Fund subscribers.


KFH Launches World’s First Islamic Economics Research Team

Kuwait Finance House Group today launched its Research arm internationally here, an initiative which is a manifestation of the strong ties and economic integration between the Middle East and Malaysia apart from the thriving Islamic Finance market in Malaysia. The initiative has been launched at a time when global economics play a decisive role in the way a market performs and when accessibility to accurate market information is crucial, Kuwait Finance House (KFH) said in a statement issued in conjunction with the launch. KFH is the first Islamic Bank in the world to establish an in-house research team while KFH Research is the first global Islamic research team to be housed in Malaysia. The team comprises industry experts devoted to generating and sharing knowledge on Islamic finance and capital markets within the Middle East. It said that the Islamic financial system, its financial institutions, markets and infrastructure, have demonstrated the system’s viability and robustness via its exponential growth within the global financial framework. This progression has brought about significant benefits for the local and the global economy as it has strengthened ties between countries and regions via its efforts to mobilise funds across borders and channelling them to productive investments, the statement said. KFH Chief Economist & Head of Research Baljeet Grewel said in her presentation that KFH’S research will provide insightful and objective research designed to enable clients to make informed investment decisions. It will be the core of the value proposition offered to clients. Meanwhile, managing director Kuwait Finance House (Malaysia) Bhd K Salman Younis, said that the research arm aimed to provide cutting edge research material to help clients make their investment decisions. “Our commitment is that wherever the KFH Group is present, we would like to contribute towards the development of Islamic banking in the region. As an Islamic financial institution, it is our social responsibility to promote Islamic finance not only in the Middle East but also globally. Our research capabilities allow us to build on this and foster the closer integration of Islamic markets,” he added. Bank Negara Malaysia (BNM) deputy governor Datuk Mohd Razif Abdul Kadir officiated the launch on behalf of governor Tan Sri Dr Zeti Akhtar Aziz. KFH is a market leader in Islamic banking in Kuwait and is engaged in providing Islamic banking services including consumer banking, real estate financing, lease financing, and trade finance. —


Islamic banks safe from crisis

Islamic banks might come out unscathed from the raging global economic crisis thanks to their unique business model.Experts in Islamic banking now claim the current global economic downturn would never have happened if the banking sector had pegged its business on the Islamic model.

Gulf African Bank, which is one of the banks operating in Kenya under strict Islamic banking law, says all of their operations have not felt any heat from the meltdown.  The CEO, Najmul Hassan says none of the 375 banks that practice Islamic banking has been affected by the crisis so far.

“The reason for this is that Islamic banking does not go into the products that got these banks into the current downfall. Look at Societe Generale, it lost billions in speculative transactions; Somitu Corporation lost because it was speculating on prices of copper. These are the very things that Sharia banking disallows,”  Hassan explained.

He noted that Islamic banking is based on neither speculation nor interest but on real growth.

“All the trading that happens in this world is not interest-based; there is real trading taking place. Some assets are purchased, you add value, and you sell them out. That is what Islamic banks do,” he said.

Hassan explained that Islamic banks buy assets, add value and sell them on deferred payment and make their profit from taking part on real economic activity in a society as opposed to conventional banks which make money on fractional lending which he described as ‘paper business’.

Speaking during the first ever Islamic banking conference in Kenya, Hassan noted that the biggest challenge for Islamic banking in the country was demystifying the concept.

“Most people stereotype us and make our banking concept look like we discriminate people on grounds of religion. This is not the case because we are open to everyone,” he said.

His comments come at a time when most banking institutions in Kenya, especially those with connections to the Western economies are on high alert. Some have tightened their lending terms while others have raised the value of collateral.


Source busiweek

QIB has launched Europe-based Global Sukuk Plus Fund

Qatar Islamic Bank (QIB) has launched Europe-based Global Sukuk Plus Fund, according to the nation’s The Penisula daily.QIB, a major global Islamic banking network, announced its London-based affiliate, European Finance House (EFH), has initiated a European-based platform designed to originate Shariah-compliant investment products, the daily added.

EFH is a primary Shariah-compliant financial institution in Europe, regulated by the UK’s Financial Services Authority.

“The growing interest in the Islamic financial market has demanded that we draw upon the innovation of the QIB network to develop investment products which will thrive within the current environment. The Global Sukuk Plus Fund is a very forward-looking product for the Shariah-compliant market and a strong option for clients thanks to the London-based bank fund’s robust investment guidelines,” the newspaper quoted Jean-Marc Riegel, QIB’s General Manager, Investment Banking and Development, as saying.

“The Fund’s geographic and sector diversification takes advantage of multiple sources, while the Fund’s active management maximizes yield and return. The investment range of this Sukuk Fund spans across six major Islamic financial markets and is easily accessed via each of QIB’s affiliates in addition to EFH, including Arab Finance House (AFH) in Lebanon and Asian Finance Bank (AFB) in Malaysia. Global Sukuk Plus Fund clients in Qatar will, of course, be serviced by QIB.”

The EFH-managed Global Sukuk Plus Fund is a weekly dealing mutual fund which invests in global sukuk markets. The QIB and EFH joint-effort Fund’s assets will be invested in sukuk issued by sovereign, quasi-sovereign and corporate issuers and sourced globally, the daily informed.

 source : arabianbusiness