Islamic finance

This was supposed to be the year of the rise of sukuk markets. As the Malaysian economy recovered and the Arab spring passed, another record year of sharia-compliant debt issuance was predicted.

But that changed after a day in May. Ben Bernanke dropped hints that the Fed would taper its bond-buying programme, and sukuk sales shrivelled in the third quarter. The number of issues this year is expected to be just above that of 2011. Continue reading »

The UK’s decision to launch an Islamic bond has been a long time coming. For a decade the prospect has been raised at the many Islamic finance conferences that have been held in London; Ed Balls, when he was City of London minister, announced the first Shariah-compliant government bonds from the UK Treasury back in April 2007.

The rationale then, as now, was to bolster London’s standing as an international financial centre. The logic then, as now, was that London ought to offer everything it can to financial markets, and that if launching a sovereign sukuk bond helps to create a benchmark for others to issue against, then that’s what it should do so as not to miss out. Continue reading »

By Chiara Francavilla of This is Africa

Morocco is finalising a new securitisation law that will allow the state and companies to issue sukuk, the Islamic equivalent of bonds. Preparations for a corporate and a sovereign sukuk are already underway, according to Islamic finance experts. Continue reading »

Last year was supposed to represent the pivotal moment in which sukuk debt – Islamic versions of bonds – came into their own as a deep, mature and liquid source of funding.

Issuance data from January suggest the jury is still out. Continue reading »

With Dubai’s economy recovering, the emirate is rediscovering its mojo. That brimming confidence has already seen the return of large-scale development projects. Now the government is moving on to big concepts.

The ruler, Sheikh Mohammed bin Rashid Al Maktoum, on Wednesday oversaw the launch of an attempt to place Dubai at the centre of the ‘global Islamic economy.’ Continue reading »

Dana Gas, the Abu Dhabi-listed energy company, has seen its share price climb since unveiling details of its $1bn Islamic bond restructuring deal on Monday.

Dana Gas, which has had to overcome cash flow issues because of late payments in troubled Egypt and Iraqi Kurdistan, offered a $70m cash payment to the creditor group led by Ashmore and BlackRock.

 Continue reading »

By Simeon Kerr and Camilla Hall

People close to Dana Gas, the Sharjah-based natural gas company, say creditors including funds Blackrock and Ashmore have agreed to a standstill that would allow talks over extending the maturity of its $920m sukuk to continue through the deadline of midnight on Wednesday.

But people aware of the creditors’ position “categorically deny” that a standstill agreement has been reached with Dana Gas, whose revenues have been interrupted in troubled operating environments including Egypt and Iraqi Kurdistan. Continue reading »

Egypt has had a tough time finding foreign finance since the overthrow of its former president, Hosni Mubarak. Its net foreign reserves have fallen by more than half since the start of 2011 and are getting dangerously low. Last month it asked the IMF for $3.2bn in emergency loans.

Now, a month after Islamist parties won more than two-thirds of seats in parliamentary elections, the country is turning to Islamic finance. An Islamic scholar familiar with Egypt’s plans told Reuters on Tuesday it was preparing to issue such bonds for the first time in a bid to raise around $2bn. Continue reading »

By Shelina Janmohamed of Ogilvy Noor

It’s the beginning of 2012 and you’ve come into work determined to flex your marketing muscles and really make a splash for your brand by growing a new segment. Where should you look? The Muslim consumer.

Here’s why: a global population of 1.8bn people who say their faith shapes their consumption choices. It’s a market estimated at $2.1tr. And its movers and shakers are the ‘Futurists’: predominantly young, tech-savvy Muslims who take pride in their faith but embrace modernity, marketing and – most of all – brands. Continue reading »

South Africa is joining the select band of non-Muslim countries preparing to issue sovereign sukuk bonds. If all goes well it could even beat the others to the market,  as those countries which have made similar moves have yet to actually launch their Islamic bonds.

The treasury on Monday invited banks to bid for advising on “the structuring and issuance of a government Islamic bond in the local and international markets”. And a spokesperson said that specific plans would be included in the funding proposals for the budget for the year starting next April. That sounds like it’s on for 2012. Continue reading »

SukukIslamic financial products may not be an obvious first port of call for investors in troubled times. But sukuk – or ‘Islamic bonds’ – are witnessing sustained demand despite the political upheavals of the Arab Spring-turned-summer and the recent volatility that has hit the global markets.

“We’ve seen a good pick up in activity in the past months and notably, at the height of market volatility”, Mohammed Dawood, head of Islamic capital markets at HSBC, told beyondbrics. Continue reading »

Gold Bangles for sale in the Istanbul bazaar
Turkey is about to join the select group of countries where cashpoint machines dispense solid gold.

Pioneered in Switzerland and introduced elsewhere last year including the Gulf, the gold coin machine is about to make its Turkish debut – courtesy of Islamic lender Kuveyt Turk Bank.  So investors will have a choice – the souk or the ATM. Continue reading »

The Bombay Stock Exchange has launched India’s first index of companies compliant with Islamic law, or shariah, in an effort to bring more of the country’s 175m Muslims into mainstream finance, and to attract investment from foreign shariah-abiding funds. Continue reading »