65,000 trained Islamic Finance personnel required until 2020
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As many as 65,000 Islamic Finance professionals are needed to fill the void of skilled practitioners in various sectors in the field.
In a bid to fill the talent pool into the robust and emerging Islamic economies, the International Islamic University Malaysia (IIUM) plans to produce more qualified Islamic Finance professionals with its industry focused programs.
In an exclusive interview with Amilin TV, Assoc. Prof.Dr. Baharuddin Aziz, IIUM’s Director in Department of Communication, stated this as one of the current demands in the Islamic Finance world.
IIUM has been identified by the Malaysian government in providing solutions to tackle this issue.
“We have already begun our third workshop on Islamic Finance in Universiti Utara Malaysia (UUM) Sintok, Al Bukhary College in Alor Setar, Universiti Teknologi Mara (UiTM) and in collaboration with other higher insitutions,” he said during the OIC International Business Centre’s Iftar Session cum Sponsors announcement at the Putra World Trade Centre, Kuala Lumpur yesterday.
When asked how the training modules in IIUM should differ from other existing universities focusing on Islamic Finance, Dr Baharuddin replied that the university was the pioneer in Islamic Finance professionals training and its alumni includes some of the highest ranks in the industry.
“We have offered Islamic Banking and Finance since our inception in 1983. So we can safely say that we are the pioneers in the Islamic Banking and Finance as so far as Malaysia is concerned. In fact, we have graduates that are now in key positions in banking and financial institutions, not only in this country, not only in the Asia Pacific region but also in other parts of the world, particularly in central Asia as well as within the OIC country nations,” Dr Baharuddin added.
Apart from that, he also said that Islamic Finance and Banking is now seen as the alternative to the weaknesses within the present monetary and financial system, the global financial system that the world is having now.
“Islamic Banking and Finance has the position or the opportunity to be an alternative. It is more human, not exploitative, the way the system operates, it creates a more level-playing field. It doesn’t cause exploitation as in the taking of the ‘riba’ (usury).
“The plight of the consumers have been realized by the Islamic Finance industry in the final analysis.”
Through its unique educational model of integration and Islamization of knowledge, IIUM offers professional courses in areas of Islamic Finance.
IUM operates under the direction of a Board of Governors with representatives from the eight sponsoring governments and the Organization of Islamic Conference (OIC).
It maintains links with governments and institutions all over the world, such as the League of Islamic Universities, the International Association of Universities and the Association of
Commonwealth Universities.
World Council Announces First Islamic Finance Manual for Credit Unions
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In Afghanistan, Helmand Islamic Investment and Finance Cooperative's accountant (right) receives training on end-of-month adjustments from the IIFC Group head of Helmand province. |
MADISON, Wis. - World Council of Credit Unions has published theIslamic Finance Manual: Operating Policies and Procedures for Credit Unions, the first known guide to establishing Shariah-compliant credit unions in the developing world. The Customer Owned Banking Association, World Council's member organization in Australia, developed the manual based on World Council's experience establishing Islamic investment and finance cooperatives in Afghanistan (2004-2012).
The comprehensive guide details operating policies and procedures based on international standards for financial cooperatives and adapted to comply with Islamic Law. The 305-page document addresses membership, shares and savings mobilization, Shariah-compliant financing and collection, provisions and allowances for bad debts, asset and liability management, capitalization and capital adequacy, accounting, cash operations, internal controls, human resources, procurement and information technology and security. Each chapter includes a comprehensive review of procedural requirements and who should be involved, including template forms and contracts.
"The Islamic Finance Manual produced with the initiative of the Customer Owned Banking Association of Australia is a product of years of dedication and cooperation among World Council staff and local Afghan leaders to adapt World Council's traditional credit union building model to an Islamic banking environment," said Brian Branch, World Council president and CEO. "The manual now provides a cornerstone for local credit union development in countries as diverse as Libya and Pakistan to Australia and the United States."
World Council's nine-year program in Afghanistan, through which the manual was developed, focused on establishing sustainable financial cooperatives as well as a national apex trade association. World Council consulted Islamic scholars and local religious leaders to modify its traditional credit union development methodology and establish the country's first fully Shariah-compliant financial institutions. Today, more than 30 IIFCs and points of service in 14 provinces across the country offer share savings and loan products that heed the Islamic prohibition on paying or receiving interest. Afghanistan's national financial cooperative association, the Islamic Investment and Finance Cooperative (IIFC) Group, was established in 2009 and became a World Council member in 2012. Afghan IIFCs comprise the world's youngest credit union movement and is the only one to claim full compliance with Islamic Law.
Islamic finance is a form of ethical financing, defined by the fair distribution of wealth, concern for the welfare of communities and economic stability. Islamic finance principles promote the protection of consumer rights and prevent investment in businesses that are considered "harmful," including gambling, armaments, alcohol and pornography. The creation of economies based on physical assets is at the heart of Islamic finance - a key reason why the Islamic financial sector was largely unaffected by the recent global financial crisis. Islamic financial markets operate in 37 Muslim countries, and many non-Muslim countries in Europe offer Islamic finance options.
Download Islamic Finance Manual: Operating Policies and Procedures for Credit Unions at www.woccu.org/operations.
World Council of Credit Unions is the global trade association and development agency for credit unions. World Council promotes the sustainable development of credit unions and other financial cooperatives around the world to empower people through access to high quality and affordable financial services. World Council advocates on behalf of the global credit union system before international organizations and works with national governments to improve legislation and regulation. Its technical assistance programs introduce new tools and technologies to strengthen credit unions' financial performance and increase their outreach.
World Council has implemented more than 290 technical assistance programs in 71 countries. Worldwide, 56,000 credit unions in 101 countries serve 200 million people. Learn more about World Council's impact around the world at www.woccu.org.
NOTE: Click on photos to view/download in high resolution.
Contact: Jennifer Bernhardt
Organization: World Council of Credit Unions
E-mail: jbernhardt@woccu.org
Phone: +1-608-395-2077
Organization: World Council of Credit Unions
E-mail: jbernhardt@woccu.org
Phone: +1-608-395-2077
Islamic finance to power Kerala startups
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Cheraman Financial Services Ltd, jointly promoted by the Kerala government and non-resident Keralites, is to fund hundreds of cash-strapped student startups coming up in the state.
The financial institution functioning on Islamic principles has set aside Rs150mn for companies in the Startup Village, Kerala’s answer to Silicon Valley, from its Rs2.5bn Alternative Investment Fund that primarily targets the Shariah-compliant service and manufacturing sectors.
There are more than 900 firms – and the number is growing fast - with innovative products started by students waiting to set up their units at India’s first telecom incubator mentored by Infosys co-founder Kris Gopalakrishnan.
“The decision to fund these projects was taken at the recent meeting of our board of directors,” P K Kunhalikutty, state industries minister who is also a director of the company - which recently received Reserve Bank of India (RBI) approval - said while addressing the Weekend@Startup Village programme here yesterday.
Cheraman, which has also got clearance from the Securities and Exchange Board of India, focuses on new companies with limited operating history that are too small to raise capital in the public markets and have not reached the point where they are able to secure a bank loan or complete a debt offering.
At least one company of students with innovative ideas is being set up each day at the Startup Village. The Village aims to host 3,000 startups by 2020.
Coming up on the same campus in this port city is the Kerala Technology Innovation Centre, another zone exclusively for bio-technology.
“A new silent revolution is happening in Kerala. Educational institutions are mushrooming and so is a new breed of young and enterprising entrepreneurs,” said the minister who spent a day with youngsters at the Startup Village.
“For these young entrepreneurs, money will not at all be a constraint”.
Chief Minister Oommen Chandy, who delivered his speech via Skype said his government was extending all help to the Startup Village to create a ‘Silicon Valley’ here.
Chandy also announced a funding scheme to regularly send student entrepreneurs to Silicon Valley to gain firsthand experience.
Startup Village chairman Sanjay Vijayakumar said the chief minister used to meet him and his team for 30 to 45 minutes each week to make the project a reality.
Anil Menon, who heads the second global headquarters of Cisco, based in Bangalore, said the world leader in networking has decided to set up a Cisco Lab at the Startup Village to tap its potential. The Lab will start “soon” he added.
Kris Gopalakrishnan disclosed that the 180 startup firms located at Technopark in the state capital Thiruvananthapuram was generating Rs2bn a year and has created 4,500 jobs. The new breed of young entrepreneurs straight from the campuses is making all the difference in Kerala, he added.
“Creating a community of entrepreneurs is much more difficult than building a company. This is going to be a fantastic success, something that’s going to change Kerala,” insisted Gopalakrishnan.
Interview - Mr Daud Vicary Abdullah
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Mr Daud Vicary Abdullah was recently interviewed on the BFM Breakfast Grille on the topic of Islamic Finance: Making a Global Splash Beyond Malaysian Shores. He also talks about INCEIF's growth, recognition and role in the global Islamic finance market.
http://media.bfm.my/assets/files/Breakfast%20Grill/2013-07-30-Podcast-BG-INCEIF.mp3
http://media.bfm.my/assets/files/Breakfast%20Grill/2013-07-30-Podcast-BG-INCEIF.mp3
Oman: New developments in Islamic financial services
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Photo Credit:Reuters/STR NewA new index for Oman's stock exchange is expected to provide a boost to the Sultanate's nascent Islamic financial services sector and lead the way for additional sharia-compliant products.
In early June, the Muscat Securities Market (MSM) announced that it was close to launching a new index, one for listed companies that operate according to the principles of sharia, as set down by the Bahrain-based Accounting and Auditing Organisation for Islamic Financial Institutions.
To be known as the MSM Sharia Index, the benchmark will contain 31 listings. Industrial firms will be the best represented, with 18 companies, followed by 10 from the services sector and three from the financial industry.
This is the inverse of the MSM30, the exchange's primary index, which is heavily weighted towards banks. The low number of financial firm listings in the new index can, to some degree, be explained by Oman's late entry into the sharia-compliant finance field, with authorisation for Islamic banking coming only in 2011.
One of the smaller Gulf exchanges, the MSM has a market capitalisation of around $30bn (compared to a GDP of about $72bn), with 165 companies trading on its boards.
The index is the latest development in Oman's Islamic financial services market, which has been in existence since Sultan Qaboos bin Qaboos Al Said issued an enabling royal decree in May 2011. Since then, two new institutions - Bank Nizwa and Al Izz International Bank - have acquired banking licences, while established conventional lenders have opened Islamic windows.
In 2012 both Nizwa and Al Izz floated initial public offerings (IPOs), in line with the central bank requirement that they list at least 40% of their shares. The IPOs were strongly oversubscribed, suggesting an appetite for Islamic products on the MSM.
Sharia-compliant banks are expected to draw in new customers rather win market share from their conventional counterparts. As Hamood bin Sangour bin Hashim Al Zadjali, executive president of the Central Bank of Oman (CBO), told OBG in 2012, "The CBO ... believes that the advent of Islamic banking in Oman will complement existing conventional banking, augment financial inclusion and promote growth in the economy for years to come."
According to Pradeep Asrani, managing director of investment services firm Gulf Baader Capital Markets, Islamic banks will capture a market share of up to 5% within two years, which in turn could promote further expansion into sharia-compliant investment funds and brokerages, as well as sukuks (Islamic bonds).
More generally, the availability of Islamic banking and other financial services is expected to act as a spur to the market and to the economy as a whole. In 2012, Ahmed bin Saleh Al Marhoon, the MSM's director-general, told OBG that the introduction of Islamic banking would inject more liquidity into local capital markets as individuals seeking sharia-compliant investment options would no longer have to look abroad. The new MSM Sharia Index will provide one more reason for these investors to place their funds locally.
© Oxford Business Group 2013
New avenue of Growth
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Photo Credit:Reuters/Akhtar SoomroWith Islamic finance becoming increasingly sophisticated, Oman may paradoxically stand to benefit from its late entry to the marketUntil very recently Islamic finance in Oman was not permitted. Indeed, in 2007 the Central Bank declared that banking should be "universal", and conducted within the framework of international financial norms - leaving it the only member of the GCC not to make a legal differentiation between conventional and Islamic finance. In May 2011, however, a Royal Decree announced that Islamic banking regulations would be added onto the existing Banking Law, enabling Oman's banks to offer Sharia-compliant products. The decision was likely driven by a variety of factors. Prime among them is the inescapable advance in recent years of "Sharia-compliant" as a global financial model for Muslims and the growing significance of Islamic banking, not least in London.
Modern Islamic banking began in the 1950s and 1960s in two very different locations: Upper Egypt and Malaysia. Since then, the concept has gained in sophistication and gradually expanded to new markets. While Malaysia remains prominent (and indeed has a state-sponsored national Sharia Board to regulate the sector), the Gulf has emerged as a significant player on the scene. Bahrain, for example, hosts the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI). It is thought that globally the sector now accounts for some $1.7trn of assets.
The rapid expansion of Islamic finance thus made it an increasingly difficult prospect to ignore, and the absence of a regulatory framework for the sector in Oman was likely seeing potential investment for the Sultanate head elsewhere. Not to mention the fact that some of the country's 3 million Muslims were increasingly rejecting conventional finance due to its associations with 'riba', or usury - the Islamic prohibition against which Sharia-compliant finance was designed to counter. It was thus hoped that the option of Islamic finance would not only improve foreign investment, but also meet latent demand for financial services among the domestic population.
It is in this context that the second Oman Islamic Economic Forum was held (the first having taken place two years ago in 2011). Among items on the agenda were improving human capital in the nascent Omani sector (an area in which Malaysian officials were keen to collaborate), as well as examining opportunities for expanding Islamic finance to small and medium-sized enterprises (SMEs) and the role of Islamic venture capital in improving research and design in the Muslim world.
The conference was not merely a chance to extol the opportunities provided by Islamic finance. Some used it to vilify conventional finance, and suggest that Shariah-compliant banking offered an alternative to a discredited financial order. Khalid Hilal Alyahmadi, whose Amjaad Development recently signed a contract with Islamic bank Meethaq to roll out a further 50 branches in the Sultanate, told audiences that "the current financial crisis was driven by greed, and there is no doubt that there is a need for an alternative financial system, one in which ethics and justice form the foundation."
Such strong - and extremely general - characterisations, while perhaps shared by some bankers as well as a proportion of the public, Muslim and non-Muslim, risk clouding the issue and confusing greed with profit. Shariah-compliant financial institutions exist to make a profit as well as provide a service. Whether that profit is derived from the time principal of money (interest as in conventional banking) or a 'management fee' as in Islamic finance, essentially the same dynamics apply. In the sense that they are specialised lending institutions with their own rules, Islamic banks are not so different from other specialist institutions already operating within the global financial system (for example, many large banks today have divisions specialising in managing lending for charitable institutions, while others follow a co-operative model of profit sharing, or promote 'ethical' lending).
However, rather than being a total antidote or straight alternative to the ills of global financial capitalism, Islamic models of finance involve additional formal procedures that tend to increase transaction costs, while the need to secure loans against tangible assets reduces the liquidity of cash held in Islamic banks. With Islamic finance still playing a relatively minor role in the global financial system, these and other problems remain under-exposed. Yet as the sector continues to expand and gain credibility, more attention will necessarily be paid to them.
Regulations and guidelines One solution, as the authorities in the Sultanate have demonstrated, is to provide a proper regulatory framework for the sector issued by the central bank. Rules released in Oman at the beginning of this year provide a thorough grounding for Islamic banking, and include guidelines for shariah scholars.
The specialised knowledge needed to issue fatwas on specific potential transactions is often restricted to no more than a handful of scholars. The Omani rules would encourage more scholars to specialise in Islamic finance by providing a six-year time limit for individual scholars sitting on bank advisory boards; they also limit potential conflicts of interest by restricting scholars to a single bank at any time.
With Islamic finance becoming increasingly sophisticated, Oman may paradoxically stand to benefit from its late entry to the market. Learning from where others have previously gone wrong has enabled the Sultanate to draw up a robust regulatory framework, which could well succeed in attracting risk-averse investors. This is particularly the case given the fraught state of regulation in some other Islamic finance markets, where disputes between secular and religious authorities over what constitutes Shariah-compliance have occasionally resulted in certain products suddenly being declared Haram. And if Oman's prior commitment to the ideal of universalism can also be maintained, there is no reason why, when it comes to banking, the Sultanate cannot offer the best of both worlds.
http://www.zawya.com/story/Oman_New_avenue_of_growth-ZAWYA20130721075438/
New Dubai-based centre to promote Islamic Banking around the world
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Shaikh Hamdan Bin Mohammad Bin Rashid Al Maktoum, Crown Prince of Dubai, launched the ‘Dubai Centre for Islamic Banking and Finance’ yesterday, which will offer students a Master degree, foundation certificates and short-term training programmes in Islamic banking and financing via Hamdan Bin Mohamad e-University (HBMeU).
“The launch of the centre is a significant boost to the Islamic economy sector in the UAE and a major step forward in the economic development agenda of Dubai,” said Shaikh Hamdan.
The centre is in line with the initiative launched by His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai.
The programmes offered will cover key subjects such as Islamic banking, finance, Sharia, economics, accounting, risk management and corporate governance.
The Chancellor of HBMeU stated that an international advisory board will help implement the services provided by the centre.
“Because this is an international initiative, we put together an international experienced advisory board which will help establish the centre under the umbrella of the university,” said Dr Mansoor Al Awar, Chancellor of HBMeU.
The programmes offered will adopt a blended learning approach of face-to-face learning, online collaboration and self-paced learning.
IDB approves USD790m for development projects
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Wednesday, July 24, 2013
The Islamic Development Bank's board of executive directors has approved new finances worth $790 million to carry out different projects in member countries.
The board, which met at the IDB headquarters in Jeddah, discussed the decision taken by IDB governors to increase the bank's capital from $45 billion to $150 billion.
"The meeting also discussed arrangements to celebrate the bank's 40th anniversary, which coincides with the next meeting of its board of governors in Jeddah," the bank said.
The board agreed to give $220 million to the renewable energy program of the Development Bank of Turkey and $200 million for an electricity project in Damietta, Egypt.
The new finances approved by the board will also benefit Morocco, Uganda, Pakistan, Burkina Faso, Mozambique, Yemen, Togo, Jordan and Mali. It has also agreed to provide grants to educational projects for Muslim communities in Kenya, Nepal and Congo.
The board meeting, which was chaired by IDB President Ahmad Mohamed Ali, agreed to give $140 million for a water project in Agadir, Morocco and $120 million for a road project in Uganda.
Tunisian Prime Minister Ali Larayedh, who was on a visit to Saudi Arabia during the period, attended the opening session of the board meeting. The IDB president welcomed the prime minister and underscored the cooperation between Tunisia and the IDB over the past years.
The board passed a $35 million loan for Pakistan to finance reconstruction of schools destroyed by the floods. Another loan worth $ 19.8 million will go to a water supply project in Ouahigouya, Burkina Faso. The board also approved $15 million for an integrated rural development project in Yemen.
The rest of the approvals included $8 million for Niassa electrification project in Mozambique, $7 million for an energy project for rural communities in Togo and $23.7 million to finance Mali's food program. A grant of $200,000 was extended to Jordan for capacity building of rural producer organizations.
The bank decided to increase its capital during a meeting of its board of governors in Tajikistan's capital Dushanbe last May to meet the growing development requirements of its 56 member countries and carry out its development mission in a more efficient manner.
The Dushanbe meeting also increased the bank's subscribed capital from 18 billion Islamic dinars to 50 billion Islamic dinars. The decision reflects the bank's strong financial position.
http://www.zawya.com/story/IDB_approves_USD790m_for_development_projects-ZAWYA20130717032525/
The board, which met at the IDB headquarters in Jeddah, discussed the decision taken by IDB governors to increase the bank's capital from $45 billion to $150 billion.
"The meeting also discussed arrangements to celebrate the bank's 40th anniversary, which coincides with the next meeting of its board of governors in Jeddah," the bank said.
The board agreed to give $220 million to the renewable energy program of the Development Bank of Turkey and $200 million for an electricity project in Damietta, Egypt.
The new finances approved by the board will also benefit Morocco, Uganda, Pakistan, Burkina Faso, Mozambique, Yemen, Togo, Jordan and Mali. It has also agreed to provide grants to educational projects for Muslim communities in Kenya, Nepal and Congo.
The board meeting, which was chaired by IDB President Ahmad Mohamed Ali, agreed to give $140 million for a water project in Agadir, Morocco and $120 million for a road project in Uganda.
Tunisian Prime Minister Ali Larayedh, who was on a visit to Saudi Arabia during the period, attended the opening session of the board meeting. The IDB president welcomed the prime minister and underscored the cooperation between Tunisia and the IDB over the past years.
The board passed a $35 million loan for Pakistan to finance reconstruction of schools destroyed by the floods. Another loan worth $ 19.8 million will go to a water supply project in Ouahigouya, Burkina Faso. The board also approved $15 million for an integrated rural development project in Yemen.
The rest of the approvals included $8 million for Niassa electrification project in Mozambique, $7 million for an energy project for rural communities in Togo and $23.7 million to finance Mali's food program. A grant of $200,000 was extended to Jordan for capacity building of rural producer organizations.
The bank decided to increase its capital during a meeting of its board of governors in Tajikistan's capital Dushanbe last May to meet the growing development requirements of its 56 member countries and carry out its development mission in a more efficient manner.
The Dushanbe meeting also increased the bank's subscribed capital from 18 billion Islamic dinars to 50 billion Islamic dinars. The decision reflects the bank's strong financial position.
http://www.zawya.com/story/IDB_approves_USD790m_for_development_projects-ZAWYA20130717032525/
Kamil: Islamic economics can speed up developmen
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Saleh Kamil, chairman of Al Baraka Banking Group , has called on Muslim countries to implement the Islamic economic system efficiently to boost their economic and social development.
"We have to understand Islamic economics clearly and implement the system in our societies properly. It would be a gift from us to humanity and would serve as an important means for spreading the message of Islam," he said.
Addressing the 34th symposium on Islamic economics at Jeddah Hilton on Wednesday night, he said: "We as scholars and bank managers have to play our role in projecting the glittering face of Islam.
"The Islamic economics is based on the teachings of God, who knows better the needs of humanity and how to tackle their various problems."
Kamil urged Islamic banks to make sure their operations are successful in realizing the objectives of Islamic economics. "What is our objective? Are we here just to mobilize funds in the name of Islamic banks?" he asked.
The symposium commended Custodian of the Two Holy Mosques King Abdullah's initiative to strengthen the private sector's participation in nation building.
"This will promote economic activities and capital flows among Arab and Muslim countries," said Adnan Ahmed Yousif, president and CEO of Al Baraka Banking Group . He said the symposium would contribute to further strengthening the Islamic banking and finance industry.
The symposium was attended by well-known scholars in the field of Islamic banking, in addition to a number of senior executives in Islamic banks and institutions.
Participants include Ahmad Khaled Babacar, secretary general of the Islamic Fiqh Council; Abdul Basit Shaibi, CEO of Qatar International Islamic Bank; and Abdul Razak Khuraiji, executive vice president and head of the Islamic Banking Development Group at NCB.
The discussions focused on issues related to 'zakat', (or alms giving practiced by Muslims) including measuring zakat for crops and fruits, and trading in the global gold market.
The first Al Baraka symposium was held in Madinah in 1981, Yousif said, adding that the symposium was instrumental in finding economic solutions to the problems faced by Muslim communities.
He commended the role played by chairman Kamil and thanked scholars, researchers, executives and Islamic banking staff for their contributions.
Al Baraka is a Bahrain-based joint stock company licensed as an Islamic wholesale bank by Central Bank of Bahrain, and is listed on Bahrain bourse and Nasdaq Dubai. It is a leading international Islamic bank providing its services to around one billion people. The group's total finance and investment jumped from $2.7 billion in 2003 to $14.3 billion in 2013, the CEO said.
http://www.zawya.com/story/Kamil_Islamic_economics_can_speed_up_development-ZAWYA20130720043717/
"We have to understand Islamic economics clearly and implement the system in our societies properly. It would be a gift from us to humanity and would serve as an important means for spreading the message of Islam," he said.
Addressing the 34th symposium on Islamic economics at Jeddah Hilton on Wednesday night, he said: "We as scholars and bank managers have to play our role in projecting the glittering face of Islam.
"The Islamic economics is based on the teachings of God, who knows better the needs of humanity and how to tackle their various problems."
Kamil urged Islamic banks to make sure their operations are successful in realizing the objectives of Islamic economics. "What is our objective? Are we here just to mobilize funds in the name of Islamic banks?" he asked.
The symposium commended Custodian of the Two Holy Mosques King Abdullah's initiative to strengthen the private sector's participation in nation building.
"This will promote economic activities and capital flows among Arab and Muslim countries," said Adnan Ahmed Yousif, president and CEO of Al Baraka Banking Group . He said the symposium would contribute to further strengthening the Islamic banking and finance industry.
The symposium was attended by well-known scholars in the field of Islamic banking, in addition to a number of senior executives in Islamic banks and institutions.
Participants include Ahmad Khaled Babacar, secretary general of the Islamic Fiqh Council; Abdul Basit Shaibi, CEO of Qatar International Islamic Bank; and Abdul Razak Khuraiji, executive vice president and head of the Islamic Banking Development Group at NCB.
The discussions focused on issues related to 'zakat', (or alms giving practiced by Muslims) including measuring zakat for crops and fruits, and trading in the global gold market.
The first Al Baraka symposium was held in Madinah in 1981, Yousif said, adding that the symposium was instrumental in finding economic solutions to the problems faced by Muslim communities.
He commended the role played by chairman Kamil and thanked scholars, researchers, executives and Islamic banking staff for their contributions.
Al Baraka is a Bahrain-based joint stock company licensed as an Islamic wholesale bank by Central Bank of Bahrain, and is listed on Bahrain bourse and Nasdaq Dubai. It is a leading international Islamic bank providing its services to around one billion people. The group's total finance and investment jumped from $2.7 billion in 2003 to $14.3 billion in 2013, the CEO said.
http://www.zawya.com/story/Kamil_Islamic_economics_can_speed_up_development-ZAWYA20130720043717/
Richest 300 Persons on Earth Have More Money Than Poorest 3 Billion
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As we repeatedly focus on wealth inequality in the United States (i.e.; just four hundred persons in the US have as much in assets and income as the bottom 50% of Americans), a video pointsout the even more extreme global wealth disparity.
There are many reasons for this. Take for example institutional sources that contribute to this trend. The World Bank, for interest, oversees "loans" to developing nations. But by creating long-term indebtedness, these struggling counties end up owing at least $600 billion dollars in interest on loans whose principals have, in essence, already been paid off in actual dollars.
These usorious interest rates end up in the hands of the bankers and the shareholders of the financial institutions that are inter-related with the World Bank through the nations that govern it, particularly the United States which calls the shots. Criticisms of the World Bank focus on how it creates financial conditions that result in debt dependency of the nations that borrow from it, therfore negatively impacting the economic prospects of the vast majority of its residents.
Trade agreements and global corporate exploitation of international monetary regulations provide resources and cheap labor to developed nations, while leaving poorer countries depleted. Is it possible that rich countries have increased the wealth gap from being 35 times greater during European colonialization to 80 times greater today? The video Global Wealth Equality contends that is the case.
This are just somes examples of how the economic cards are stacked by the G-8 and G-20 through the institutional and global corporate creation and manipulation of the financial rules. But when you move to the impact of global wealth distribution to individuals, according to Global Wealth Equality, the richest 1% on the earth have accumulated some 43% of the world's wealth, while the bottom 80% of the planet's inhabitants have just 6% between them.
There is an increasing wealth gap of immense proportions in the United States. For decades, the nation's assets have grown more and more concentrated in the hands of a few, while the rest of the nation makes do with the crumbs.
This skewed economic distribution within the US is reflective of an even worse economic disparity in the world in general.
The post-colonial era has actually accelerated economic injustice on a worldwide basis. What's done in the name of helping the world's poor (by the World Bank and the International Monetary Fund) is often really only a process of capturing markets too weak to fight back and indebting them to the masters of wealth without recourse. This has become abundantly clear in the World Bank's policies of "structural adjustment" for the developing world, which might be best phrased as "you pay us the interest on our loans and impose austerity on yourselves. It will be good for you."
Sound familiar?
Nigeria planning to raise a sukuk bond worth $62 million
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A state government in southwestern Nigeria is planning to raise a sukuk bond worth 10 billion Nigerian nairas
A state government in southwestern Nigeria is planning to raise a sukuk bond worth 10 billion Nigerian nairas (some $62 million) from the capital market to fund infrastructural development, the first such step by Africa's second biggest economy.
"(The state) is awaiting final approval from the Security and Exchange Commission (SEC)," Semiu Okanlawon, spokesman for Osun State Governor Rauf Aregbesola, told Anadolu Agency.
"By the time we get it, the marketing of the bond should hopefully take off from this month," he added.
In March, the SEC approved new guidelines for the issuance of sukuk bonds, only months after new guidelines were also approved for the operation of takaful (Islamic insurance).
"So far, there has been no objection from the SEC. The expectation is high," said Okanlawon.
A local credit ratings agency, Agusto and Co, has given the note – to be listed on the Nigerian Stock Exchange – an A rating.
Okanlawon said the seven-year bond would be issued through "a book-building process," which would earn returns for sukuk holders through a semi-annually paid rent structure called the Ijara.
The spokesman described the move as part of a 60 billion naira debt-raising program by Osun State, which started last year.
"The funds will be used to finance construction of education projects, among other development initiatives with which the governor hopes to lay a solid foundation for the future of the state," said Okanlawon.
Investopedia, an online guide to investment, defines the sukuk as "an Islamic financial certificate, similar to a bond in western finance, which complies with Islamic religious law."
It adds: "Because the traditional western interest-paying bond structure is not permissible, the issuer of a sukuk sells an investor group the certificate, who then rents it back to the issuer for a predetermined rental fee. The issuer also makes a contractual promise to buy back the bonds at a future date at par value."
Investopedia goes on to assert that "sukuk must be able to link the returns and cash flows of the financing to the assets purchased, or the returns generated from an asset purchased. This is because trading in debt is prohibited under Sharia. As such, financing must only be raised for identifiable assets."
Erdogan tells Turks to shun credit cards, rounds on banks
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urkish Prime Minister Tayyip Erdogan urged Turks not to use credit cards, accusing banks of locking people into poverty with excessive fees, and rounding on an "interest rate lobby" he says is seeking to weaken the economy.
The comments opened a new front in the verbal attacks Erdogan has periodically made against the financial community, which is betting the country's central bank will raise borrowing costs next week to steady the ailing lira currency.
Speaking late on Tuesday during an Iftar dinner, the evening meal with which Muslims break their daily fast during Ramadan, Erdogan said banks were growing rich on high commissions and urged people to live within their means.
"Don't get these credit cards," he said at the dinner with families of war veterans and fallen soldiers.
"Who is paying this money, it is not the rich but the poor. They die to get a credit card. They show off with it. Before the month's end the money finishes ... We have to thwart this game together."
Erdogan and members of his government have accused speculators and a "high-interest-rate lobby" of stoking volatility in financial markets to make a quick profit at the expense of the Turkish economy.
With the prime minister also keen to maintain strong economic growth ahead of elections next year, the central bank has been reluctant to hike rates following a credit-fuelled boom.
But the country's assets have been hit along with other emerging markets since the U.S. Federal Reserve suggested in May it would begin scaling back its stimulus program, while weeks of often violent anti-government demonstrations last month damaged Turkey's reputation for stability added to the pressure.
Governor Erdem Basci signaled on Monday the central bank may raise rates next week to stem a slide in the Turkish currency, which has sunk to record lows against the dollar in recent weeks.
That would make the lira and lira-denominated assets such as Turkish government bonds more attractive to foreign investors, as well as pushing up commercial banks' lending rates.
Erdogan, who repeatedly said last year he wanted real interest rates of zero percent, vowed last month to "choke" speculators growing rich off "the sweat of the people", urging Turks to put their money in state not private banks.
"I didn't say "interest rate lobby" recently for nothing. I say these things because I know something," Erdogan said.
In a rare written statement ahead of Tuesday's central bank monetary policy committee meeting, governor Basci said global policy uncertainty and volatility would not be allowed to damage financial and price stability in Turkey.
The lira eased slightly to 1.9285 against the dollar by 1028 GMT from 1.9211 late on Monday but remains well off its weakest-ever level of 1.9737 seen on July 8.
New Hong Kong Tax Rules For Islamic Finance
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Legislation to amend the Inland Revenue Ordinance and Stamp Duty Ordinance, and provide a comparable taxation framework in Hong Kong for some common types of Islamic bonds (sukuk) compared with conventional bonds, went into operation on July 19, 2013.
"The Amendment Ordinance represents the joint efforts of the Government and the market to remove a previous impediment to developing a sukuk market in Hong Kong," said the Secretary for Financial Services and the Treasury, Professor K C Chan.
"This will help establish a conducive platform for the development of Islamic finance in Hong Kong, thereby diversifying the types of products and services available to our financial markets, and consolidating Hong Kong's status as an international financial center and asset management center," he added.
The amendments will give tax and stamp duty relief for transactions underpinning the issuance of sukuk products, whose global volume is estimated, by the end of 2012, to have exceeded USD220bn. As sukuk, which cannot involve the payment or receipt of interest, have more complex product structures than their conventional bond counterparts (often using special purpose vehicles and multiple asset transfers), their issuance may attract additional profits or property tax exposures, or stamp duty charges.
The Government has observed that major jurisdictions such as Malaysia, the United Kingdom, Singapore, Japan and France, have amended their tax laws to facilitate sukuk issuance. Chan has stressed that the proposed legislation will not confer special tax favors on sukuk – classified as an "alternative bond scheme" – but should ensure that financial instruments of similar economic substance are afforded similar tax treatments.
To provide implementation guidance, the Inland Revenue Department will shortly publish the related Departmental Interpretation and Practice Notes and Stamp Office Interpretation and Practice Notes.
Britain wants to be hub for Sharia banking
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Zahid Chisti is a meticulous man. As a pharmacist he has to be -- he must carefully count the pills and measure the medicine he dispenses. When it come to money, Zahid also likes to do things by the book -- in this case the Koran.
"Under Sharia Law we’re prohibited from taking or giving interest." says Zahid. "I try to avoid taking or giving interest in any of the transactions I process, in my business or in my personal life."
When he saves money with his local Islamic bank, Zahid gets a return but he doesn’t officially earn interest. He shares in the profit the bank makes from investing his funds and the bank does not invest in anything "un-Islamic," like alcohol or gambling.
Three million muslims live in Britain, and although not all are as devout as Zahid, more and more of them are demanding financial products compatible with their faith. Sultan Choudhury, head of the Islamic Bank of Britain, the UK’s first fully sharia-compliant financial institution, says his business is booming:
"Our Islamic mortgage book has gone up nearly 90 percent in one year. Our deposits have gone up 22 percent. Customer numbers are growing on average at 8 percent per annum,” claims Choudhury.
This is a global phenomenon. Islamic finance is growing fast around the world. Sharia-compliant transactions are now worth an estimated $1.2 trillion a year, and that figure is expected to triple before the end of the decade. British business leaders are eager to cash in on this expanding revenue stream.
"We look at a growing market and think to ourselves: we would like to have more of that," says David Slater of London and Partners, a body set up to promote business in the British capital.
Slater and his colleagues, backed by the British government, are now pushing for London to become the global hub for Islamic finance and they’ll be pressing their case at the 9th World Islamic Economic Forum, a huge gathering of Muslim politicians, business leaders, and scholars. London will host the Forum in October, the first time the event will be held outside a Muslim country.
"We want to say, we’re open for business and we want your business and we’ll produce the right sort of products to enable that business,” says Slater.
Britain has already thrown open the door to Islamic finance. More Islamic bonds, or sukuk, have been issued on the London Stock Exchange than any other bourse -- more than $34 billion worth. The U.K. has the largest Islamic banking sector outside the Middle East and Asia -- 22 banks, 12 more than the United States. Britain has already changed its commercial and taxation laws to accommodate sharia-compliant finance, although not everyone is happy about it.
“I don’t think religion should be playing a part in our finance system in this way,” says Terry Sanderson, president of the National Secular Society. Sanderson is worried that by expanding Islamic finance, Britain may be letting Sharia Law in by the backdoor and giving British and foreign Muslims too much political leverage.
“They would have a large stake in this country through the finance system, which they might use to manipulate the political processes,” he says. “I’m not saying they will do that. But that’s the possibility if this form of finance becomes really big.”
But advocates for London’s financial center dismiss these concerns. They say the city is the ultimate, international financial souk with more currencies traded there than anywhere on earth, and with every conceivable form of finance. It is too big to bully. It has nothing to fear from Sharia.
Amãna Takaful PLC partners with Commercial Bank of Ceylon
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Thursday, July 18, 2013
Amãna Takaful PLC, a composite insurer and the pioneer of the Takaful way of insurance in Sri Lanka recently announced a Bancassurance partnership with Commercial Bank of Ceylon to offer insurance services through the branch network of the bank.
The MoU that was signed recently by Chief Executive Officers of the two organizations was held at the Commercial Bank head office in the presence of senior officials of both organisations.
This strategic partnership with Commercial Bank will enable the Bank’s customers to have direct access to selected Life and General Takaful insurance products offering a one-stop-shop solution.
The new move comes in addition to the already existing relationship with Commercial Bank as a payment point for Amãna Takaful policies.
“We are pleased be able to strengthen our partnership through the years with one of the most respected Banks in Sri Lanka.
Through this MoU we hope to widen our reach and offer customers greater transactional flexibility and convenience”, said Fazal Ghaffoor, Chief Executive Officer, Amãna Takaful PLC.
The insurance agreement with Commercial Bank will allow customers to have access to Takaful Motor, Takaful My Home, Takaful Fire Cover, Mortgage and Fire protection at Commercial Bank branches.
“This partnership is in line with our on-going strategy to enhance access of our insured members to quality financial services and reaffirms our commitment to forming strategic relationships with one of the best financial service providers in Sri Lanka.
We believe that through this relationship we can greatly improve the quality of both insurance and banking services offered to our customers,’’ Ghaffoor, further explained.
Managing Director/Chief Executive Officer of Commercial Bank Mr. Ravi Dias said “We are pleased to tie up with Amãna Takaful Insurance for Bancassurance services and believe that it will provide more options to our customers when selecting an insurance policy”
Commercial Bank is the largest private bank in Sri Lanka, and the only Sri Lankan Bank to be listed three years consecutively in the world’s Top 1,000 Banks.
It operates a network of 232 service points in Sri Lanka and a network of 570 ATMs, the single largest ATM network operated by a bank in the island.
The Bank has been adjudged ‘Best Bank in Sri Lanka’ for 15 consecutive years by ‘Global Finance’ Magazine, and has won multiple awards as the country’s best bank from ‘The Banker,’ ‘Finance Asia,’ ‘Euromoney’ and ‘Trade Finance’ magazines.
Amãna Takaful recently stayed true to its word of ‘redefining insurance’, by announcing to its General insurance policyholders a payment of “surplus”.
The payment is a proportionate rate off the SURPLUS of the Risk Fund at the end of defined period to all non-claimant Takaful policyholders. One of a few ISO certified insurance operators in Sri Lanka; ATPLC now operates in 23 locations with plans of expanding its footprint further.
The company offers total insurance solutions to meet all needs of its customers, the Takaful way.
The MoU that was signed recently by Chief Executive Officers of the two organizations was held at the Commercial Bank head office in the presence of senior officials of both organisations.
This strategic partnership with Commercial Bank will enable the Bank’s customers to have direct access to selected Life and General Takaful insurance products offering a one-stop-shop solution.
The new move comes in addition to the already existing relationship with Commercial Bank as a payment point for Amãna Takaful policies.
“We are pleased be able to strengthen our partnership through the years with one of the most respected Banks in Sri Lanka.
Through this MoU we hope to widen our reach and offer customers greater transactional flexibility and convenience”, said Fazal Ghaffoor, Chief Executive Officer, Amãna Takaful PLC.
The insurance agreement with Commercial Bank will allow customers to have access to Takaful Motor, Takaful My Home, Takaful Fire Cover, Mortgage and Fire protection at Commercial Bank branches.
“This partnership is in line with our on-going strategy to enhance access of our insured members to quality financial services and reaffirms our commitment to forming strategic relationships with one of the best financial service providers in Sri Lanka.
We believe that through this relationship we can greatly improve the quality of both insurance and banking services offered to our customers,’’ Ghaffoor, further explained.
Managing Director/Chief Executive Officer of Commercial Bank Mr. Ravi Dias said “We are pleased to tie up with Amãna Takaful Insurance for Bancassurance services and believe that it will provide more options to our customers when selecting an insurance policy”
Commercial Bank is the largest private bank in Sri Lanka, and the only Sri Lankan Bank to be listed three years consecutively in the world’s Top 1,000 Banks.
It operates a network of 232 service points in Sri Lanka and a network of 570 ATMs, the single largest ATM network operated by a bank in the island.
The Bank has been adjudged ‘Best Bank in Sri Lanka’ for 15 consecutive years by ‘Global Finance’ Magazine, and has won multiple awards as the country’s best bank from ‘The Banker,’ ‘Finance Asia,’ ‘Euromoney’ and ‘Trade Finance’ magazines.
Amãna Takaful recently stayed true to its word of ‘redefining insurance’, by announcing to its General insurance policyholders a payment of “surplus”.
The payment is a proportionate rate off the SURPLUS of the Risk Fund at the end of defined period to all non-claimant Takaful policyholders. One of a few ISO certified insurance operators in Sri Lanka; ATPLC now operates in 23 locations with plans of expanding its footprint further.
The company offers total insurance solutions to meet all needs of its customers, the Takaful way.
BTMU: Next global hub for Islamic finance
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Bank of Tokyo-Mitsubishi UFJ (M) Bhd (BTMU) aims to become the global hub for Islamic finance within its global operation upon the launch of four new Islamic financing products today.
BTMU is the first Japanese bank to offer Islamic financial products and services under its international currency business unit and the first Japanese bank to have an in-house syariah committee comprising prominent Malaysian scholars.
Its president and CEO Masato Nakamura said the unit has been focusing on Islamic banking businesses in currencies other than the ringgit and has steadily gained recognition from the industry.
“Our commitment is well-supported by the expanding team of experienced professionals in Islamic finance.
“The development is being guided by the establishment of our own syariah committee that has the capability to endorse syariah-compliant transactions in our various business line,” he told reporters after the launch of the products here today.
Bank Negara Malaysia director of Islamic banking and takaful department, Wan Mohd Nazri Wan Osman, launched the products – Istisna’ Financing-i, Ijarah Financing-i, Standby Letter of Credit-i and Bank Guarantee-i.
Nakamura said BTMU Malaysia hoped to effectively contribute to the enhancement of financial cooperation and encourage the Islamic finance by Japanese enterprises in the region.
(Bernama)
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