Islamic funds forum is a major success

Delegates and speakers from 25 countries took part in the eighth Annual World Islamic Funds and Financial Markets Conference which closed at the Gulf Hotel yesterday. “This has been by far the most international edition of this event that we have hosted so far and that is a reflection of the spread of Islamic finance from just the Muslim world to further afield,” said organiser MEGA Events managing director David McLean.

“We are not just talking about financial institutions here because what we saw this year was a strong representation from corporate entities who are turning from conventional finance to Islamic institutions when it comes to looking at ways to raise money.

“We have had leading institutions from as far apart as Ireland and Luxembourg taking part and a strong showing from Malaysia which has been dominating the sukuk market in recent years,” he added.

He said he believed the quality of speakers was again extremely high and the feedback he had so far was very positive.

“We are committed to bringing this conference back to Bahrain next year and we have already had a lot of delegates asking about how they can sign up for the ninth edition,” he added.

“Islamic finance may remain fairly small compared with conventional finance but it is a fast growing industry which is attracting more international interest across a wide range of financial service sectors.

“One of the fast growing sectors is Islamic insurance and because of that we will be launching a dedicated conference on takaful in Bahrain in October this year as well as returning with the World Islamic Banking Conference towards the end of the year,” he added.

Islamic funds forum is a major success


Islamic finance still has to achieve critical mass if it is to address problems of liquidity, according to KPMG Fakhro Bahrain partner “The sukuk market is definitely growing but it has yet to reach the necessary critical mass.

“The industry needs sukuk and interbank lending to meet its liquidity needs but unfortunately the bigger banks that have excess liquidity are not over keen to lend to smaller banks that do not have ratings.

“We will need to see more consolidation in the banking market and that is something that we are already seeing,” he added.

He said that while the sukuk market was expanding, almost 100 per cent of the issuance in 2011 was in Malaysia.

He added that the other problem the industry faced was a lack of standardisation on how banks deal with each other and on the issue of regulation.

“The industry is moving forward in developing standardisation but it is a slow process compared with the growth in the industry,” he said.


Islamic council distributes $850,000 to needy Muslim families

The Islamic Religious Council of Singapore (Muis) has distributed more that $850,000 to 2,210 needy families under its assistance scheme, known as the zakat fund.

This year, each family received an extra 1.7 times the usual amount they get from the Muis zakat fund each month to help cope with living expenses, reported The Straits Times.

From the total amount, $206,010 was allotted to families with children who are schooling. This is called the reqab bonus.

The reqab bonus, which was introduced two years ago, is an extra amount given to these families to cope with the costs of textbooks and learning programmes.

The Straits Times said that this year, one-third of the families received between $100 and $300 of bonus, half the families received between $300 and $500 extra, and the remaining families received more than $500 extra.

Last year, only 1,890 families were eligible to receive the bonus from Muis.

Muis announced that five families have graduated from its Empowerment Partnership Scheme and will no longer receive monthly financial aid from the council as they are now able to cope with their own expenses.

The council aims to help more than 140 families graduate from the scheme by December 2012.

Kerala must tap Islamic funds for infrastructure development, say experts

Kerala could become a role model of tapping Islamic finance market to raise badly needed funds for infrastructure development, according to experts.

Mr H. Abdur Raqeeb, Convener, National Committee on Islamic Banking at the New Delhi-based Indian Centre for Islamic Finance (ICIF), made a strong pitch for these funds at the Infrastructure Conference-2011 that began here on Wednesday.

Speaking to Business Line, the State Minister for Public Works, Mr V.K. Ibrahim Kunju, and the Secretary, PWD, Mr Manoj Joshi, said that the State Government wholeheartedly welcomed Islamic funding agencies in the space of infrastructure development.

Infrastructure development is as Shariah-compliant a cause as they come, Mr Joshi said. There is nothing that prevents these funds being channelised into the State’s developmental scheme of things, he added.

The PWD Minister concurred, but observed that the State’s own efforts to set up an Islamic financing institution were ‘still in a fluid stage’’.

The Minister for Industries, Urban Development and IT, Mr P.K. Kunhalikkutty, too underscored the importance of tapping the Islamic finance model at a time when traditional sources of funds are becoming increasingly inaccessible or cost-prohibitive.

Meanwhile, Mr Raqeeb quoted a Kerala High Court observation that no specific prohibition was contained in any statute that made it impermissible to carry out Islamic banking in the country.

Simple regulatory changes could transform India into a regional hub for Shariah-compliant finance and clear the way for a much-needed wave of investment into its infrastructure, he added quoting international experts and consultants.

“When London, Tokyo, Hong Kong, Singapore and Paris have become Islamic banking hubs why can Kerala not become one and lead the country to become a developed economy in the near future?,” he wondered.

Asset-backed Islamic bonds, known as ‘Sukuks’, provide funds for long-term investment. This tool is used in a number of developing and developed countries. India too should seek to make use of these resources, Mr Raqeeb said.

The fact is Islamic finance can do wonders. Post 9/11, petro-dollars have been actively eyeing for a safe investment destination. And this is the opportunity that India should avail of, given that it is not just a safe but vibrant investment destination.

An estimated $1.5 billion in funds is sloshing around the Middle East as of now. The region will have $8 trillion to invest by the year 2020.

Ms Muliani Indrawati, Managing Director, World Bank, has confirmed that the World Bank Group has “formally recognised Islamic finance and has designated it a priority area in their financial sector programme’’.

The World Bank has always closely cooperated with the Islamic financial services sector. This demonstrates its commitment to help strengthen the institutional development of the industry.

In Sudan, in the Islamic microfinance space, we have a full programme which we hope to see develop to cover other countries and sectors. The World Bank will play a positive role in industrial development and economic growth, as such.

Islamic banking focuses on transparency, cooperative ventures, shared risk and ethical investing attracts a wide range of both Muslims and non-Muslims alike.

In Malaysian Islamic banks, more than 40 per cent of investors and 60 per cent of borrowers are non-Muslims, mostly Chinese. One in five applicants for some of the Islamic products is a non-Muslim in the Islamic Bank of Britain.

Trade among Islamic states to grow 20%

JEDDAH: The International Islamic Trade Finance Corporation (ITFC), an affiliate of the IDB Group, is making intense efforts to increase trade among members of the Organization of Islamic Cooperation (OIC) to 20 percent of their total trade by 2015. It has given $13 billion since 2008 to finance trade.


“This is the target set by the extraordinary Islamic summit held in Makkah on Dec. 7-8, 2005. Since then a lot of improvements have taken place in intra-OIC trade,” said Waleed Al-Wohaib, CEO of ITFC, adding that his organization had given $10 billion during the past three years to finance trade.

He was talking to Arab News following a meeting of IDB and OIC officials at the bank’s headquarters to discuss ways and mechanisms to boost trade between the member countries.

“This year alone we’ll give a record $3 billion to finance trade,” he said.The meeting was important as it comes in the wake of global recessions that have affected intra-OIC trade.

The ITFC, which was formed in 2006 and began its operations in 2008, has been instrumental in promoting intra-OIC trade by strengthening coordination between the various trade-related organizations in the OIC countries. The intra-OIC trade reached a record 17 percent last year with trade exchanges of member countries crossing $500 billion.

“We want to mobilize the resources of the Ummah to boost intra-OIC trade,” Al-Wohaib said, adding that such a move was essential to confront the Western economic tsunami that had a negative impact on OIC countries.

“It’s unfortunate that the intra-OIC trade is still stagnant at 16 percent. So it was necessary to review our mechanisms and what should be done to overcome this situation,” he said.

He said the meeting was successful as it brought forth a number of new ideas to strengthen intra-OIC trade.

He disclosed plans to hold more consultations in this respect involving heads of various OIC and IDB organizations, experts from OIC countries and international bodies and politicians to discuss ways to boost trade and overcome obstacles.

Al-Wohaib said the meeting called for reviewing the current executive program, greater coordination among OIC and IDB organizations, and greater involvement of member countries.

“OIC countries have to include intra-trade in their national plans,” he said while explaining the meeting’s proposals.

Public Mutual launches two new Islamic funds that will focus on the domestic market

KUCHING: Public Bank Bhd’s wholly-owned subsidiary, Public Mutual Bhd (Public Mutual) is launching two new Islamic funds, namely the Public Islamic Treasures Growth Fund (PITGF) and Public Sukuk Fund (PSKF) today.

islamic fund,islamic,domestic market,new islamic fund,public bank,PSKF,PITGF,islamic finance


To note, PITGF is an Islamic equity fund that seeks to achieve capital growth over the medium- to long-term period by investing primarily in small and medium sized companies, which comply with syariah principles. Meanwhile, PSKF seeks to provide annual income through investments in sukuk and Islamic money market instruments.

Commenting on the launch of these two new Islamic funds, Public Mutual’s chief executive officer Yeoh Kim Hong remarked, “Small-to-mid cap stocks generally offer higher growth opportunities versus larger stocks due to their smaller earnings base. Continue reading

Waqf Fund launches Diploma in Islamic Commercial Jurisprudence for Shari'ah reviewers

The programme, due to commence from October, is being offered with the assistance of Bahrain Institute of Banking and Finance (BIBF).

islamic finance,shariah reviewers,waqt fund,diploma islamic commerical,islamic commerical diploma,islamic finance training,islamic finance,islamic financial institutions,shariah compliants

The Waqf Fund, a Bahrain-based special fund to support Islamic finance training, education and research, has announced the launch of Diploma in Islamic Commercial Jurisprudence aimed primarily at those working for internal Shari’ah review departments of Islamic financial institutions. Continue reading

INDONESIA – FINANCE – 75% of fund Management of Islamic Hajj

Jakarta (11 / 7) – Dana pilgrims who are in government now began a dominant run by sharia. The data was recorded last June was 75% of the funds contained in the existing Hajj Islamic instruments.
Director of the Ministry of Religious Pilgrimage Fund Management, Drs.H. Achmad Djunaidi revealed that the greatest pilgrimage funds contained in sukuk. “Now 75 percent of the sharia, 25 percent in conventional banks.

Most of the funds contained in the sukuk about 60 percent, “he said. (source – google translate) When asked why not one hundred percent of funds managed Islamic hajj?

He replied that his side are now being herded all funds pilgrimage to the Islamic instruments. “The funds are being directed to it, is now 75 percent have not previously exist,” he said. He believes the future pilgrim fund will be managed entirely by sharia. “Muslims will certainly choose the sharia,” he said. Meanwhile for the Islamic banks alone, now there are some who have been part of 26 Beneficiary Bank Deposit (CPM) Cost of Operation of Hajj (BPIH).

Among them are Islamic banks Bank Negara Indonesia (BNI) Syariah, Bank Syariah Mandiri, Bank Bukopin Syariah, Bank Muamalat, Bank Mega Syariah, the State Savings Bank (BTN) Sharia and Islamic Bank of West Java. Continue reading

Waqf Fund launches diploma programme

MANAMA: The Waqf Fund, a Bahrain-based special fund to support Islamic finance training, has launched a Diploma in Islamic Commercial Jurisprudence. The qualification is aimed primarily at those working for Internal Sharia Review departments of Islamic financial institutions.

islamic fund,islamic finance,financial institutions,islamic financial institution,diploma programme,waqt fund,islamic finance training,BIBF

The programme, due to commence from October, is being offered with the assistance of Bahrain Institute of Banking and Finance ( BIBF). Continue reading

Gulf States Plan to Have United Shariah Council by 2021

Gulf Arab states may have a single Shariah board for the region’s Islamic financial institutions in five to 10 years, a Shariah scholar said in Dubai today.

A “supreme Shariah council” will help reduce the cost of issuing sukuk and boost Islamic services offered by financial institutions that comply with the religion’s ban on interest, said Hussain Hamed Hassan, head of Dubai Islamic Bank PJSC (DIB)’s Shariah committee.

Hassan, who is also chairman of the Shariah Coordination Committee of the Islamic Financial Institutions in the United Arab Emirates, told Bloomberg in June last year that the single Shariah council may be established by 2013.

The scholar criticized central banks for treating Shariah- compliant financial institutions as if they were non-Islamic companies. Only a “few” central banks were exceptions, including those in Bahrain and Sudan, he said.

Hassan also said auditing practices used for Islamic financial industry after the sale of sukuk were “dishonest” because the assets sold during the sale of Islamic bonds remain on companies’ balance sheets even after the issuer receives the funds raised. Most sukuk are based on ijarah, a sale and lease agreement as in real estate.

“If I sold assets and I took the money in my pocket, why is the asset still in my balance sheet?” Hassan asked.

The scholar serves on the Shariah boards of more than 20 Islamic financial institutions, according to data compiled by Bloomberg.


Shari`ah Council for Gulf Sukuk Market

DUBAI – Seeking to boost a flourishing Islamic finance sector in their states, leaders of the Gulf Arab nations are planning to have a united Shari`ah board overseeing the region’s Islamic financial institutions.

The “supreme Shari`ah council” will help reduce the cost of issuing sukuk (Islamic bonds), Hussain Hamed Hassan, head of Dubai Islamic Bank PJSC (DIB)’s Shari’ah committee, told Bloomberg on Wednesday, June 8.

Projected in five to ten years, the planned council aims to boost Islamic services offered by Shari`ah-compliant financial institutions, added Hassan who is also the chairman of the Shari’ah Coordination Committee of the Islamic Financial Institutions in the United Arab Emirate.

Like other forms of Islamic financing tools, sukuk do not receive or pay interest.

It typically operates through actual transactions such as profit-sharing or leasing. Continue reading