IIB posts $1.7 million profit in first quarter


IIB posts $1.7 million profit in first quarter

International Investment Bank (IIB), a globally focused Islamic investment bank based in Bahrain, earned net income of $1.7 million in the first three months of 2012 compared with a net loss of $1.3m in the same period last year.

Total income for the first quarter ended on March 31 was $3.2m compared with $0.9m a year earlier, mainly derived from investment banking fees and profit earned on funds placed with financial institutions.

Total expenses were reduced to $1.4m in the period, a reflection of management’s stringent ongoing cost control policy. Share of loss from associates was $0.2m compared with $0.7m in the first quarter of 2011. The bank booked gains on foreign exchange of $0.1m in the first quarter.

Total assets at the end of first quarter were $151.4m compared with $148.5m in the fourth quarter last year. The increase principally arises from the purchase of investments of $3.4m in 2012 funded partially by the profit made during the first quarter.

Capital adequacy ratio was 36 per cent as at March 31 versus the Central Bank of Bahrain’s minimum requirement of 12pc, demonstrating IIB’s capacity to significantly increase its investment portfolio in the future from a regulatory capital perspective.

“Trading conditions in 2012 continue to be very challenging for investment banks for two principal reasons. Firstly, many investors have incurred significant losses during the past three years on their regional and global portfolios and have, therefore, been reluctant to commit to making new investments. Secondly, many regional banks have suspended the provision of financing of real estate development and private equity projects. Despite the challenging market environment, IIB’s stakeholders and investors have demonstrated their confidence in our strategy, that has resulted in IIB earning a net income of $1.7m during the three-month period,” IIB chairman Saeed Abdul Jalil Mohammed Al Fahim said.

“During the current difficult global conditions, the bank has adopted the strategies of prudent investing, strict liquidity management and capital protection. IIB’s asset position demonstrates core strength with 40pc of total assets represented by cash and short-term murabaha placements with financially-sound regional banks with a further 7pc invested in regional listed equities, giving a total liquidity position of 47pc,” he added.

“Our strategy has been to structure and market to clients a range of attractive investment offerings in the manufacturing, financial, energy and real estate sectors in various countries. During 2012, IIB has concluded one investment banking transaction in Bahrain and also purchased shares in a regional quoted company. The bank’s ‘pipeline’ of potential transactions has enabled it to evaluate several opportunities for possible future launches or direct investment. IIB’s balance sheet continues to be strong, evidenced by the fact that it had no borrowings or off balance sheet commitments during the year,” chief executive and board member Aabed Al Zeera said.

URL: http://www.gulf-daily-news.com/NewsDetails.aspx?storyid=331366

CIMB wins top industry award

The achievements, innovations and excellence in the global Islamic funds and investments industry were recognised yesterday at the WIFFMC 2012.

The annual WIFFMC Islamic Investment Institution of the Year Award, which is one of the most prestigious in the industry, is designed to recognise institutions that have made a significant contribution to the global Islamic funds and investments industry.

 

The award recognises a leading institution that has demonstrated outstanding achievements and institutional excellence in major performance areas. CIMB Principal Islamic Asset Management was voted as the 2012 WIFFMC Islamic Investment Institution of the Year from a shortlist of nominees through an industry based voting process.

CIMB wins top industry award

CIMB’s nomination for the award was based on their superior and consistent performance of their funds, based on a disciplined investment process.

“We are extremely delighted to have been voted the WIFFMC Islamic Investment Institution of the Year 2012,” said CIMB Principal Islamic Asset Management chief executive Datuk Noripah Kamso.

“CIMB Principal Islamic is committed to offering Islamic investment solutions that best meet institutional global investors’ needs and objectives,” said Ms Kamso.

URL: http://www.gulf-daily-news.com/NewsDetails.aspx?storyid=330488

Dubai's Ridge Capital buys Egypt asset firm Rashad

Dubai-based regional investment bank Ridge Capital has bought 100 percent of Egyptian asset management firm El Rashad Holding, which is expanding its Islamic financing business, its financial adviser said on Tuesday.

Rashad manages two funds, one for Misr Iran Bank and the other for National Bank of Egypt, and last month launched a third in Bahrain that specialises in Islamic investments, Karim Amin of Sempra Capital, which acted as Ridge’s adviser on the deal, told Reuters.

The new $100 million Bahraini fund has been licensed to raise money in Bahraini dinars. It will take money from funds in the Middle East and North Africa for investment in Sharia-compliant funds in Bahrain and elsewhere in the region, Amin said.


Dubai's Ridge Capital buys Egypt asset firm Rashad

 

An emailed Sempra statement quoted Ridge official José Ferreira Ramos as saying: “We are optimistic about the prospects of the Egyptian economy and the financial services sector in Egypt, especially Islamic finance.”

Amin declined to provide other financial details on the transaction.

El Rashad Holding, which was formed in the early 1990s, sold its securities group earlier this year to another Dubai company, Arqaam Capital.

URL: http://www.reuters.com/article/2012/05/15/egypt-rashad-idUSL5E8GFKS420120515

Malaysia: IDB Group & Malaysia to Organize an Investment Forum Next May in Kuala Lumpur

JEDDAH, 11 Jumada Al-Thani/2 May (IINA)-The Islamic Development Bank Group and Malaysia will jointly organize the Malaysia-IDBG Investment Forum from 9-11 May 2012, at JW Marriott Hotel, in Kuala Lumpur, under the auspices of Hon. Dato Sri Haji Mohamed Najib bin Tunsari Haji Abdul Razak, the Prime Minister of Malaysia.

The three days Forum is titled “Forging Strategic Business Partnerships between Malaysia and IDB Member Countries,” and aims at enhancing opportunities for investment and business partnerships between Malaysia, IDB member countries.

The Forum will also focus on market driven innovation by leveraging and strengthening business partnership with Far East economies (South Korea, Japan, China) to address the growing need of member countries market through Malaysia as a preferred gateway.

The program of the Forum will include briefings, presentations and exhibitions by trade and investment organizations from other member countries as well as by renowned investors. There will also be business matching sessions to facilitate foreign participants exploring partnership prospects with their Malaysian counterparts.

 

ISLAMIC INVESTMENTS

 

In addition to that, the Member Country Partnership Strategy (MCPS) for Malaysia will be launched during the Opening Ceremony. The MCPS is a framework that provides, for IDB, an avenue for structured dialogue and priority setting with member countries and facilitates better alignment at the country level. The MCPS is also providing opportunities for partnering and co-financing resulting from the active engagement by the IDB with other partners during preparation. This initiative was launched in March 2010 to cover all (56) member countries.

The IDB Group President, Dr. Ahmad Mohamed Ali, will lead the Group delegation and will sign two MOUs with the World Islamic Economic Forum, the HALAL Development Corporation, and witness the signing of MOU with Tabung Haji and the Islamic Corporation for the Development of the Private Sector (ICD), the private sector arm of the IDB Group.

Participants include business women and business men from member countries, along with delegations from Russia, South Korea, China, in addition to financial institutions like Kuwait Finance House, and OIC institutions like Malaysian-Turkish Chamber of Commerce, Arab Chamber of Commerce. Malaysian banks and major industries will also participate along with related Ministries and diplomats. For registration and information, you can log online:www.idbgbf.org/Malaysia.

It’s worth mentioning that since inception, Malaysia has received IDB Group funding for 117 operations  worth an amount of $1.43 billion including project financing operations for $514 million, trade financing operations ($396 million), treasury operation ($381.2) million, and the remaining were for technical assistance and special assistance operations.

The IDB Group President, Dr. Ahmad Mohamed Ali, will lead the Group delegation and will sign two MOUs with the World Islamic Economic Forum, the HALAL Development Corporation, and witness the signing of MOU with Tabung Haji and the Islamic Corporation for the Development of the Private Sector (ICD), the private sector arm of the IDB Group.

Participants include business women and business men from member countries, along with delegations from Russia, South Korea, China, in addition to financial institutions like Kuwait Finance House, and OIC institutions like Malaysian-Turkish Chamber of Commerce, Arab Chamber of Commerce. Malaysian banks and major industries will also participate along with related Ministries and diplomats.

It’s worth mentioning that since inception, Malaysia has received IDB Group funding for 117 operations  worth an amount of $1.43 billion including project financing operations for $514 million, trade financing operations ($396 million), treasury operation ($381.2) million, and the remaining were for technical assistance and special assistance operations.

URL: http://iina.me/wp_en/?p=1008127

What is an Islamic investment.

Islamic investments are a unique form of social responsible investments because Islam makes no division between the spiritual and the secularThe establishment of an Islamic investment policy, be it for the institutional or individual investor, starts with the Shariya Board, a group of Islamic scholars (jurists) that vests investment products for compliance with Islamic Law and conducts ongoing due diligence of them.

Sources for interpretation follow a hierarchy of authority: the Quran, believed by Muslims to be the words of Allah verbatim as revealed to his prophet Muhammad in the seventh century; the Sunni which are rules from the prophet’s sayings (Habits) and actions; Quays which are scholarly legal deductions; and Irma, the consensus of scholars on a particular issue.

The challenges that a Shariya-compliant portfolio faces would appear to be no different than those that any other portfolio manager would come up against. A manager formulates an investment thesis which drives portfolio selection criteria. He or she then needs to decide against the appropriate benchmark against which to measure performance.

 

What is an Islamic investment.

 

Managing assets in accordance with Islamic precepts is a bit more unique in that the practice is a form of socially responsible investing with the unique specification of avoiding interest bearing investments of any kind. Because borrowing and setting aside excess funds in short-term, low-risk, interest-bearing instruments are integral to corporate finance, the application of Islamic law to corporate finance poses some interesting questions.

Is it feasible for a portfolio manager to be completely invested at all times? May one remain faithful to Islamic law in the stock selection when the realities of corporate finance dictate the need for companies, even those not engaged in prohibited businesses, both to borrow and to find a principal-protected repository for excess cash?

From a private client portfolio management perspective, once armed with Shariya-permissible products, an investment committee at an
would face the same issues as any other, namely, how to develop, implement and monitor an investment policy consistent with a client’s objectives. Additional challenges exist, namely the lack of both a deep secondary market for these products and the lack of uniform standards in the vetting process across the Muslim world.
Read more: http://www.investopedia.com/ask/answers/07/islamic_investments.asp#ixzz1tgfhXQR3

10 Questions with Adam Ebrahim

Adam Ebrahim is the CEO of Oasis, a global fund management organisation specialising in Shari’ah compliant investment solutions.

Adam Ebrahim, along with his brothers Shaheen and Nazeem, began Oasis in 1997. Today, the organisation offers investment products and services across a number of capital markets and has assets worth over $4 billion under its management. In addition to institutional clients and high net worth individuals, Oasis specialises in offering investment opportunities for retail investors and individuals seeking to grow their real wealth. Its investments are geared to seek long-term capital growth and offer high levels of asset protection.

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Mideast gears up for Islamic Finance 2.0

Although operating on a lower risk profile due to restrictions on hedge funds, short-selling and high yield products, Islamic banks still faced challenges last year in manufacturing, distribution and IT governance. However, recent developments have helped boost optimism that the Islamic finance boom in the last decade was not a one-off.

Although the Islamic finance industry amounted to $1tr globally in 2010, it has too often been measured in relation to volumes of Islamic bonds outstanding, the number of standalone banks worldwide, or the size of the Islamic funds industry. Indeed, one of the many fallouts of the global financial crisis is that investors have grown more cautious when analyzing the performance of this fast-growing industry.

Like the aviation sector, Islamic finance has always been complex and costly. Islamic financial solutions have to abide to the guidelines of Sharia law and must be monitored for life by auditors and the boards of Sharia scholars.

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Malaysia should be ready for challenges in Islamic finance

KUALA LUMPUR: Malaysia has all the ingredients to be a success story in Islamic finance but it will not come by itself, according to Prof Volker Nienhaus.

He advised the country to prepare itself for the second phase of competition with the new entrant of Islamic finance markets such as South Korea and Thailand.

“One has to identify and take it as a challenge and not to compete with the first phase of South Korean or Thai initiative but prepare for the second phase. Let them prepare the market but be prepared for the second phase,” Nienhaus told StarBiz in an interview. Nienhaus is a visiting scholar under the Securities Commission (SC)-Universiti Malaya (UM) Visiting Scholar Programme. Continue reading

Ulema announce Shariah standards for investment in stock market

Mumbai: Ulema and clerics have given their nod, with some conditions, to investment in stock market, saying share trading is closer to Shariah than the present banking and insurance system. The Islamic Investment and Finance Board (IIFB), which has Maulana Wali Rahmani and Maulana Khalid Saifullah Rahmani as Members among others, have come up with Shariah standards for investment in stock market.

IIFB members met in Mumbai recently and discussed in details the share trading and investment in stock market in the light of Shariah. The meeting was attended by Maulana Wali Rahmani, Sajjada Nasheen, Khanqah Munger, Maulana Khalid Saifullah Rahmani, General Secretary, Islamic Fiqh Academy, Mufti Fuzailur Rahman Usmani, Mufti Shoaibullah Khan, Mufti Mohd Yahya Qasmi, Mufti Anwarul Haq Qasmi and Maulana Obaidullah Neyaz Qasmi.

Giving details about the Shariah standards formulated by the Ulema and members of IIFB, Imtiaz Merchant, Founder of Pragmatic Wealth Management Pvt. Ltd., told media in Mumbai on 18th Jan. 2011 that the Ulema while admitting there are some unpleasant aspects of stock market in the eye of Shariah, they concluded it is closer to Shariah than banking and insurance industry.

IIFB, according to Imtiaz Merchant, felt purchase and sale of shares is the modern form of Shirkat which is allowed by Shariah, so compared to banking system and insurance system, share trading is closer to Shariah. With some conditions, therefore, investment in stock market can be done, though it can’t be said that even following the conditions, share trading will be completely Shariah compliant. But compared to other forms of investment, this is better and has less evils, said Merchant adding that as Muslims are not in position to run their own economic system, this can be adopted. Continue reading

Islamic finance in India: a prospective

Noor En Ahmed

The Indian Economy is blazing since last couple of years, as per government claims and similarly Indian stock exchange is also showing remarkable performance by crossing the 21K mark however, it also dipped below 15K. But it happens in the stock market and market expert still believes that Indian stock Market is still fundamentally strong.

But there is a sector in India still in the nascent stage and is known by Islamic Banking and Finance and Sharia’s (according to Islamic rule) Investment. However, in the globe, it is growing with more than 10% growth rate and currently Islamic Asset is nearby USD500-billion in the world as per Forbes, the premier business magazine stated.

But, in India it is in the embryonic stage. However, there are some non-banking cooperative societies being operated across the India that follows the fundament finance law. But, still no banks as per Reserve Bank of India’s norms has been settled in India.

The RBI in this regard had set up a committee headed by Anand Sinha, chief general Manager in-charge, department of banking operations & development in 2005 to seek out the scope of Islamic banks in India but the committee in its presented report had denied any chance to open any banks in present existing condition of RBI.

But, due to estimating massive revenue in Islamic financial sector, some foreign banks include Citibank, Standard Chartered Bank and HBSC have opened Islamic windows in some of the western countries like US and Europe and several West Asian countries. They are operating on interest-free banking for Islamic windows as they claim.

But, in India there are only few non-banking financial corporates include Al Ameen Islamic Financial & Investment Corp. (India) Ltd, Al-Falah Investment Ltd, Al-Barr Finance House Limited (India), Bank Muscat International (SOAG) and Seyad Shariat Finance (according to Academy for international Modern studies, Canada) are working successfully. These banks work on no-profit-no-loss basis and provide a wide range of loans as well.

These banks provide housing, consumer, personal, educational, automobile and several other loans as per banks’ individual terms and conditions. They usually invest in government securities, small savings schemes or units of mutual funds for earning profits.

The account holders who want only ‘halal’ (fair as per Islamic rules) money can get the loans from these financial institutes as it claims. Now, what is ‘halal’ income?

The ‘halal’ income denotes the income, which comes from avoiding these sources (alcohol, tobacco, porn related fields, pork and interest from exploitation). The incomes from cheating, fraudulent and gambling are also ‘haram’ (invalid).

On the other hand, the stock market and Mutual funds, which most Muslims earlier avoid, are now grabbing the opportunities since the entry of two major investment institutes Parsoli Investment and IDAFA investment.

At present Parsoli Corporation ltd is the biggest known investment company that is listed on Bombay Stock Exchange and Ahmedabad Stock Exchange and has the nexus with network-18 group, however it has been working since 1990. Besides this, IDAFA investment pvt. ltd  is another investment firm constituted in 1994 and claims to invest money in Mutual Funds and stock market by following the Islamic rules.

http://www.newstrackindia.com/newsdetails/3283

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