Sukuk issuance surpasses pre-crisis levels

Islamic bond issuance last year surpassed pre-crisis levels for the first time – after more than doubling in volume – while one bookrunner predicted momentum will continue with a further 50% rise in 2012.

The volume of sukuks, or bonds that are Shariah-compliant, issued during the year rose to $32.6bn, from $14.9bn in 2010, with roughly half the volume of deals occurring in the fourth quarter, according to data from Dealogic. It was the first time volume surpassed pre-crisis levels.

The bonds benefitted from uncertainty in the global market, which drove investors to more stable issuances, according to HSBC Amanah, which was the fourth largest bookrunner last year. The firm said it expected the momentum to continue into 2012, anticipating a total of $44bn in deals this year.

Despite a rise in the number and volume of deals in the Middle East last year, Malaysia remained the dominant nationality of deals, with the year’s five largest sukuks issued by the country’s government or corporates.

There were $25.4bn of Malaysian sukuks issued during the year, while Malaysian financial services firm CIMB Group was the top bookrunner with $7.9bn in proceeds.The largest deal last year was a $6.1bn sukuk issued by an investment holding company owned by the Malaysian government treasury, Khazanah Nasional.

The United Arab Emirates represented the second most popular country for bond issuance with $2.6bn in deals during 2011, according to Dealogic.

Government-related sukuks will continue to dominate the market in 2012, according to a year-end HSBC Amanah forecast, with Asian and Middle Eastern infrastructure projects acting as major drivers. Malaysian toll and highway firm Projek Lebuhraya Usahasama Berhad kicked off the year by announcing that it would issue a massive $9.7bn sukuk.

Middle East banking group Emirates NBD and First Gulf Bank both had $500m issuances in the first two weeks of January. Dubai Islamic Bank had a $300m issuance.

Mohammed Dawood, managing director of Islamic global markets for Emea at HSBC Amanah said demand has continued outstrip supply in January, which has been the busiest start to the year he’s seen.

“Sukuk is favoured by investors because it has been less volatile than conventional issuances, especially in the last four months of 2011. Issuers on the other hand, like sukuk because it gives them access to a new investor base,” Dawood said in HSBC’s projections for the new year.

Qatar Central Bank to Hold Lenders’ Islamic Assets to Maturity

Dec. 15 (Bloomberg) — Qatari commercial banks will be required to transfer accounts from their Islamic divisions into a portfolio to be held by the central bank until they mature, under a rule separating the two kinds of finance.

“These will be carried in a portfolio, outside the activity of their business,” Central Bank Governor Sheikh Abdullah bin Saud Al Thani said in a telephone interview today. “We are not in the business of mixing the Islamic with the non- Islamic by the end of the year.”

The central bank sent a circular to commercial lenders in February ordering them to stop taking new Islamic deposits immediately and shut Islamic branches by year-end on concern they may be using funds from the conventional bank for Islamic loans. Banks have the option to transfer Sharia-compliant accounts to an Islamic bank, Sheikh Abdullah said in an interview with the Qatar News Agency on Dec. 11.

Doha Bank QSC, Qatar’s fifth largest lender by market value, will sell its Islamic arm and will have two months to complete the transaction, Sheikh Abdullah said. The bank will submit a report by Dec. 20 on how disposal of the division will take place, he said. “They are going to sell.”

Sale of Islamic assets “is not certain,” Doha Bank Chief Executive Officer Raghavan Seetharaman said in a telephone interview today. “Nothing is concluded. We have options open. If there is a good price, why not?”

Converting Branches

The bank will comply with the order by converting its Islamic branches to conventional branches, Seetharaman said today. Sale of the Islamic division won’t happen before the end of the year, he said yesterday.

Islamic banks in Qatar, which include Qatar Islamic Bank SAQ, Masraf Al Rayan, Qatar International Islamic Bank and Barwa Bank, have faced competition in recent years from Sharia- compliant arms of non-Islamic lenders. Masraf Al Rayan shares have jumped 42 percent this year, while Qatar’s benchmark QE Index added less than 1 percent.

International Bank of Qatar, a private lender, is the only commercial lender so far to announce the sale of an Islamic arm. It agreed in August to sell its Al Yusr Islamic banking operation to Barwa.

Qatar National Bank SAQ, the country’s largest lender, said in October it will keep its Islamic accounts until they mature. HSBC Holdings Plc will close its Islamic banking unit HSBC Amanah in Qatar by the end of the year, Steve Bottomley, head of strategy and planning for the Middle East and North Africa, said in May.

Fattah, Amanah launch Haj fund in Kazakhstan

Every Muslim country especially the populous ones such as Turkey, Iran, Indonesia, Pakistan, Bangladesh and Egypt should have one. But of the 56 member countries of the Islamic Development Bank (IDB), only one has and another is in the process of establishing one. The institution in question is a non-banking savings institution for would-be Haj pilgrims such as the one pioneered by Malaysia in the 1960s, Lembaga Tabung Haji (The Malaysian Pilgrims Management Fund) which today has assets in excess of RM10 billion with equity stakes in Islamic banks, plantations and technology companies.

fattah,amanah,haj,amanah raya berhad,lembaga tabung haji,haj fund,islamic finance,haj fattah,islamic fund,kaj haji Continue reading

Islamic or conventional banking

Companies in Bahrain and Bangladesh now have the option to use products based on Islamic or conventional banking at HSBC.

This is because, through the HSBC launched the HSBC Amanah products and services to meet the needs of corporate banking in these countries began earlier this month.Among the products introduced in Bahrain is a business account, investment solutions, working capital and trade finance.

Islamic or conventional banking

Islamic or conventional banking

Chief Executive Officer of HSBC Bahrain, Patrick Gallagher said the bank has introduced a conventional banking in the country since 1945.

”As one of Bahrain as an Islamic financial center in the world and has been strong demand for Islamic banking, we have embarked on the retail banking of HSBC Amanah in 2008.

Service”is being extended for Islamic banking products,”he said in a statement here today.

HSBC will also open a similar operation in Bangladesh this month, also provides a range of Shariah-based products.

Among them is the current account, short-term deposits, investments, financing, Internet banking services, foreign exchange, import and service assurance solutions.

HSBC Amanah is the first international bank providing Islamic products and services for retail and corporate customers.

HSBC Islamic arm eyes 125 new branches by 2012

DUBAI  (November 08, 2010) : HSBC Amanah, the Islamic arm of bank HSBC, plans to open 125 branches throughout the Middle East and Asia by the end of 2012 eyeing rapid growth in the $1 trillion Islamic finance industry, a top executive said.

— HSBC Amanah plans largest branch increase in Malaysia

— Wakala Master Agreement with IIFM progressing

Middle East and Asian markets will fuel growth in the industry with compounded annual growth rates of over 6 percent in the next five years, said Razi Fakih, HSBC Amanah’s deputy chief executive in an interview with Reuters on November 04. Continue reading

HSBC Amanah's Deputy CEO Says to Offer Islamic Finance in India, China

HSBC Holdings Plc, the largest bank in Europe, plans to offer Shariah-compliant services in India and China to tap economic growth after the countries issue regulations to develop their Islamic financial markets.

HSBC Amanah also plans to expand in Egypt and Oman, said Razi Fakih, the deputy chief executive officer of the bank’s Islamic unit. The lender, which has operations in 10 nations including Malaysia and Saudi Arabia, is seeking to increase bank branches globally to about 125 over the next two years from 100 at the end of 2010, he said.

“Our ability to expand in these markets depends on how the regulatory environment changes in those countries,” Fakih said in a telephone interview from London today. “Licensing to foreign banks is restrictive in certain markets. We would certainly like to see ourselves in the entire Middle East.”

HSBC is trying to strengthen its brand in a market that has attracted competitors such as Barclays Plc, Citigroup Inc. and Standard Chartered Plc to tap wealth from the world’s 1.6 billion Muslims. Global assets held by Shariah-compliant financial institutions may climb to $1.6 trillion in 2012 from about $1 trillion, the Kuala Lumpur-based Islamic Financial Services Board said in April.

Continue reading

HSBC Targets Branches: Mid East Roundup

HSBC’s Islamic Arm Targets 125 Branches by 2012.

HSBC Amanah, the Islamic arm of HSBC(HBC), plans to open 125 branches across the Middle East and Asia by the end of 2012, eyeing the rapid expansion in the Islamic finance industry which is worth $1 trillion, Dailystar reports.

Razi Fakih, HSBC Amanah’s deputy CEO said Islamic banking will grow at a 6% CAGR in the Middle East and Asia over the next five years. He further added that the next attractive markets will be China and India and HSBC is seeking to extend presence in countries like Egypt, Turkey, and Oman.

However, the lack of liquidity management tools and standardization in Asia and the Gulf pose challenges.

China and India to Get Qatar’s Additional LNG

Qatar, the world’s largest LNG exporter has identified two buyers for its additional capacity, Gulfbase reports, citing Qatar’s oil minister. The minister indicated that Qatar could export 7 million tonnes of LNG annually to China and about 5 million to India, from the originally planned exports of 5 million tonnes to China and 7.5 million to India. Continue reading

HSBC Amanah to open more branches in the south

JOHOR BARU: HSBC Amanah Malaysia Bhd plans to open more branches in the southern region, comprising Johor, Malacca and Pahang, in the coming years.

HSBC Amanah to open more branches in the south

HSBC Bank Malaysia Bhd area director (southern region) Alias Harun said the three states offered good long-term growth prospects and business opportunities in the Islamic banking segment especially with activities from the economic growth corridors of Iskandar Malaysia and East Coast Economic Region (ECER). Iskandar Malaysia covers the southernmost part of Johor while ECER covers Pahang, Kelantan and Terengganu and part of Johor’s Mersing.

“I can’t tell you exactly how many branches we are planning to open in the southern region as this comes under the purview of our corporate headquarters,” Alias said at the handing-over of the premises for the HSBC Amanah’s new branch in Taman Nusa Bestari by KSL Holdings Bhd’s wholly owned subsidiary Khoo Soon Lee Realty Sdn Bhd.

It would be HSBC Amanah’s eighth branch and the first in Johor – the other branches are two in Penang and one each in Bandar Utama, Ampang, Klang, Shah Alam and Cheras.

HSBC Amanah is a full-fledged Islamic bank, wholly-owned by HSBC Bank Malaysia Bhd. “This year also marks our 100th anniversary in Johor when we first opened our HSBC Bank in Johor Baru in 1910,” said Alias.

He said the corporate headquarters has lined up several activities in conjunction with its centenary in Johor and would announce the details at appropriate times.

Alias said the Islamic banking segment would be as important as the conventional banking in the country as Malaysia strongly advocated the banking segment and many countries were looking at Malaysia as a leader in it.

Khoo Soon Lee Realty general manager Tang Ching Tong said presently, there were seven banks operating in Taman Nusa Bestari and many local and foreign banks would open their branches soon.