Monday, 24 November 2014

Event Summary (KLCIF2015) - KL Conference on Islamic Finance 2015


KL Conference on Islamic Finance 2015


Date    : 17-18 March 2015
Venue : Grand Seasons Hotel, Kuala Lumpur - Malaysia

“An international gathering of practitioners, scholars and experts to discuss and share their knowledge, expertise and experience on the principles, instruments and issues related to Islamic finance, to be held at the world’s leading Islamic financial centre…Kuala Lumpur.”


Event site : www.islamic-finance-conference.net

KEY FOCUS/TOPICS:
- Product development and Implementation of Islamic financial products
- Ensuring Shariah compliance in Islamic financial instruments
- Sukuk: development, issues and challenges
- Islamic gold account: a golden opportunity
- Islamic mutual funds (unit trusts): factors to consider in making an investment
- The rise of Islamic wealth management in Islamic finance industry
- Islamic financial planning: success in both worlds
- Takaful: innovation and solutions
- Enterprise risk management for Islamic banks
- Enterprise risk management for takaful operators
- Accounting and auditing
- Human capital development in Islamic finance industry
- Legal issues and challenges in Islamic finance
- Dispute settlement in Islamic finance: issue and solutions
Islamic ethics in financial services industry
- Corporate governance for Islamic finance industry


SPEAKERS:

Speakers are selected from Islamic banks, takaful operators, academicians, legal practitioners, consultants, regulatory bodies.

Among the speakers are:


WHO SHOULD  ATTEND:
- Islamic bankers/bankers
- Takaful/insurance operators
- Regulators
- Head of governmental departments
- Financial planners/wealth advisors
- Financial consultants
- Legal practitioners (lawyers)
- Academicians (lecturers)
- Entrepreneurs (businessmen/importers/exporters etc)
- Other professionals 

REGISTRATION:
Early Bird Fee: 
Registration with payment by 17 February 2015
Malaysian   :  RM1,500
International  :  USD600

Normal Fee:
Registration with payment after 17 February 2015
Malaysian  :  RM1,800
International  :  USD700
Special fee for Malaysian university lecturers :  RM1,000 (group discount not applicable)

Fee is inclusive of lunch, refreshments and seminar package only.


Group Discount:
Enjoy 20% discount for third and subsequent delegates registered from the same organisation and the same billing source.


DOWNLOAD BROCHURE
(will be uploaded soon...for now you may request for tentative program or you will be given a tentative program when register online)

 Download the brochure

REGISTER ONLINE



ORGANISER


VENUE


Grand Seasons Hotel, Kuala Lumpur - Malaysia

MEDIA PARTNERS


Kuala Lumpur


Lahore

Religion, flexibility and reduced risk push Islamic finance growth

ADU DHABI, Nov 23 — When a Muslim cleric told Ahmad Salim that shariah law forbids paying interest, he returned his days-old loan to the bank and turned to the fast-growing industry of Islamic finance.
It is a market that has doubled in size over the past four years and is now worth more than US$2 trillion (RM6.6 trillion), with demand forecast to soar to new heights.
Salim returned a US$35,000 loan just two days after he received it from a conventional bank in Kuwait.
“A cleric told me it is not permissible under Islam to take loans from a non-Islamic bank because they charge interest,” the white-collar worker said.
A few days later, he arranged for a loan from an Islamic bank after paying a US$700 service charge.
As well as the religious aspect, customers are attracted to Islamic finance by its flexibility, link to real economic activity and its ban on transactions involving speculation or uncertainty, experts say.
To meet ever-increasing demand, Islamic finance has developed numerous products compliant with shariah law, from loans for cars and houses to funding for major infrastructure projects.
“Despite being governed by strict religious principles, Islamic finance remains highly flexible and less risky. These have helped it to expand fast and meet various forms of demand,” Kuwaiti economist Hajjaj Bukhdur told AFP.
Around 40 million of the world’s 1.6 billion Muslims are now clients of the Islamic finance industry, which has surged in popularity since its days as a small niche market in the early 1970s.
The International Monetary Fund (IMF), the World Bank, and other global economic bodies estimate that the assets of Islamic financial institutions grew nine-fold to US$1.8 trillion between 2003 and last year.
They are estimated to have already crossed the US$2 trillion mark.
The industry, which spans more than 70 countries, could be worth US$4 trillion by 2020, according to forecasters including Standard and Poor’s.
About 80 per cent of the assets are now in banks, 15 per cent in Islamic bonds called Sukuk, four per cent in investment funds and one per cent in Islamic insurance known as Takaful.
Iran accounts for about 40 per cent of Islamic banking assets, Saudi Arabia 12 per cent, and Malaysia 10 per cent.
Shunning toxic assets
Proponents argue that Islamic banks outperformed their conventional counterparts during the 2008 global financial crisis.
Their capital and liquidity buffers are seen as helping to shield them during market turbulence or credit shocks.
“Islamic banks generally escaped the worst effects of the 2008 financial crisis because they were not exposed to subprime and toxic assets,” World Bank managing director Mahmoud Mohieldin said in a recent research note.
But the industry, based on the sharing of profit and losses, was badly hit by the second round of the crisis which affected real estate and other sectors in the Gulf region.
“In the Gulf, both Islamic and conventional banks and companies were hit equally by the crisis. Some Islamic investment companies were forced out of the market,” Saudi economist Abdulwahab Abu-Dahesh said.
Islamic finance’s link to solid assets is seen as one of its major strengths.
“They do not deal in derivatives or speculation,” said Abu-Dahesh, a former senior economist with a conventional bank.
Introduced more than a decade ago to cater for large-scale financing, Sukuk bonds are among the most successful Islamic financial products.
Sharia prohibits trade in debt, so unlike conventional bonds, which give ownership of debt, Sukuk are asset-based securities that give investors a share in the project. They also offer better yields.
In June, Britain became the first sovereign issuer of Sukuk outside the Islamic world with an issue of £200 million (RM1.05 billion), an offering that was swamped by strong demand.
The global value of such outstanding bonds was US$269 billion at the end of 2013, and the market is expected to expand at a double-digit rate, Dubai International Financial Centre governor Essa Kazim estimates.
Sceptics say the booming industry owes its success to religion, but others say it also makes financial sense.
“I have been dealing with Islamic banks for the past two decades for purely economic reasons and good profit,” said Amin Mahmoud, a private sector manager.
(Malay Mail Online / 23 November 2014)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Pakistan picks banks to hold dollar sukuk roadshows, will start Monday

Pakistan has mandated four banks to arrange fixed income investor meetings starting Monday ahead of a potential issue of a U.S. dollar-denominated Islamic bond, a document from lead managers said on Sunday.
The sovereign, rated Caa1 by Moody's and B- by Standard & Poor's, has picked Citigroup, Deutsche Bank, Dubai Islamic Bank and Standard Chartered to arrange the roadshows and the possible deal, it showed.
Pakistan will hold roadshows in the United Arab Emirates on Monday, before heading to London and Singapore on Tuesday, with a 144A-compliant, benchmark-sized sukuk to follow, subject to market conditions, the document added.
Benchmark size is traditionally understood to mean upwards of $500 million. If a debt issue is 144A-compliant, investors in the United States can buy the offering.
The sukuk uses a sharia-compliant sale and lease-back structure to underpin the transaction. Proceeds will be used to purchase land comprising the M-2 Motorway, which connects Lahore to the capital Islamabad.
Political instability in Pakistan had temporarily caused some uncertainty around the sovereign sukuk issue as Prime Minister Nawaz Sharif came under pressure from weeks of demonstrations calling on him to resign.
Pakistan, a favourite with frontier market investors since peaceful elections were held there last year, sold $2 billion of dollar-denominated bonds in April after attracting $7 billion in investor orders.
In September 2013, the IMF saved Pakistan from possible default by agreeing to lend it $6.7 billion over three years.
The sukuk will be issued by Pakistan International Sukuk Company and is expected to be listed in the Luxembourg Stock Exchange.

Pakistan's external debt was about 19 percent of gross domestic product (GDP) on June 30 and it had a fiscal deficit of 5.5 percent of GDP in 2013-2014, it showed.
(Reuters / 23 November 2014)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Saturday, 22 November 2014

Mashreq sees sukuk pipeline starts spilling deals after market volatility

After sales of Islamic bonds began the fourth quarter at the slowest pace in six years, sukuk from companies including FlyDubai and Bahrain Mumtalakat Holding Co are among deals announced or sold this week. They will increase the amount raised this quarter to at least $5bn.

“These deals have been in the pipeline and the market volatility in September and October delayed them,” said Abdul Kadir Hussain, the chief executive officer of Mashreq Capital DIFC Ltd, who correctly predicted last week that sales would rebound. “The market seems supportive now and issuers are trying to get them out of the way.”

Bond volatility dropped 32% since reaching a more than one-year high on October 15, according to the Bank of America Merrill Lynch’s MOVE Index, which measures price swings in Treasuries based on options. There is demand for Islamic debt, especially for some of the new issuers, as they offer a higher yield than the more established ones, according to Apostolos Bantis, a credit analyst at Commerzbank AG in Dubai.

FlyDubai, the Dubai-based budget carrier, is selling as much as $500mn in sukuk. Bahrain’s sovereign wealth fund tapped the Islamic bond market for the first time on Tuesday, raising $600mn, while Drake & Scull International issued Shariah-compliant debt earlier this week.

FlyDubai, which is wholly owned by the Dubai government, is said to pay as much as 212.5 basis points above midswaps, the people said. That compares with about 165 basis points over the corresponding midswap that Emirates is paying on its sukuk maturing in March 2023. The airline is the world’s biggest by international passenger traffic.

Global sukuk yields have retreated 17 basis points since reaching a five-month high in October to 2.8% on November 18, according to a gauge compiled by Deutsche Bank AG.

The latest transactions won’t be enough to make for a record sukuk issuance year, Hussain at Mashreq Capital, which manages about $1.2bn, said by e-mail from Dubai on Tuesday. “Net new issuance will be flat to lower,” he said.

Sukuk sales have exceeded $40bn in 2014 compared with last year’s total of $43.1bn, according to data compiled by Bloomberg.

Turkey sold $1bn in 10-year Islamic bonds on Tuesday, the first sukuk offering since October 2013. Advanced Petrochemicals Co in Saudi Arabia said on Tuesday it sold a five-year floating-rate sukuk in a private placement, issuing 1bn riyals ($267mn). Drake & Scull, based in Dubai, also raised $120mn via a five-year sukuk in a private placement.

The issuer base is “widening,” Afaq Khan, chief executive officer of Standard Chartered Saadiq, said by phone on Tuesday. “It’s diversifying portfolios not only in terms of industries, but also geographies and in terms of risk reward so you can have Islamic Development Bank and FlyDubai in your portfolio.

(Gulf Times / 21 November 2014)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Malaysia: CIMB Islamic partners IRTI to produce Islamic finance country reports


KUALA LUMPUR: The Islamic Research & Training Institute (IRTI) of the Islamic Development Bank (IDB) Group and CIMB Islamic Bank Bhd has partnered to develop the Islamic Finance Country Reports (IFCR) on Malaysia and Indonesia. 

The IFCR is expected to provide in-depth information, and independent due diligence to facilitate the growth and development of the Islamic finance industry in IDB Group member countries and encourage investment by enhancing transparency.

Ini a statement on Friday, CIMB Islamic chief executive officer Badlisyah Abdul Ghani said that stakeholders within the industry need to be adequately equipped with necessary knowledge and better understanding to steer the business towards new directions within the Islamic finance industry.

He added that IFCRs will provide the industry with valuable knowledge resources towards enhancing the Islamic finance industry and cater to the growing number of customers in the real economy through well-structured, sustainable and innovative products and services.

Meanwhile, director general of IRTI Mohd Azmi Omar said that IFCR will analyze the success story of the Malaysian Islamic finance industry and provide the lessons learnt to other IDB member countries. 

Through this combined initiative, the two institutions aim to facilitate access to information that is currently not available to stakeholders and thereby ontribute to the growth and development of the Islamic finance industry. 

Apart from helping to increase investor confidence, the reports will facilitate better understanding mong regulators, market players, academicians, students and other stakeholders.


(The Star Online / 21 November 2014)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Friday, 21 November 2014

Malaysia: Great Eastern inks takaful deal with Bank Muamalat

KUALA LUMPUR: Great Eastern Takaful Bhd has signed an agreement to distribute bancatakaful products with Bank Muamalat Malaysia Bhd, enabling the former to tap into the latter’s customer base of 700,000.
Great Eastern chief operating officer Zafri Abdul Halim said the partnership is the best step to maximise both companies’ potential in providing holistic financial solutions to customers as it will allow Bank Muamalat to access Great Eastern’s range of products that will enhance the bank’s product offerings to its customers.
“Currently, three credit-related takaful products pertaining to housing loan, hire purchase and personal loan are available at Bank Muamalat. As for advisory, our investment-linked family takaful plan, i-Great Bakti, is offered through Bank Muamalat so far,” he said at the signing ceremony and the joint launch of its first family takaful plan, M-Tiara Hajj.
M-Tiara Hajj takaful plan provides assistance from as low as RM100 to prepare for customers’ Haj as well as a maximum of RM500 aid to certificate holders to help finance the cost of a Qurban during Hari Raya Aidiladha.
In the last financial year, bancatakaful from Bank Muamalat contributed about 10 per cent to Great Eastern’s takaful revenue.
“We expect to achieve substantial growth in terms of contribution with the launch of M-Tiara Hajj. With Bank Muamalat’s resources and commitment, we are confident that we are able to achieve this target,” Zafri said.
Bank Muamalat expects to see a take up rate of 3,000 from its base customers on the joint product.
“We received good feedback on the soft launch for the product three months ago even though the promotion campaign and exposure on the product is not wide enough,” said its head of consumer banking division Attar Salleh.
“The take up rate is expected to be achieved by the end of our year ending March 31 next year.” he added.
(New Straits Time Online / 19 November 2014)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Islamic finance body AAOIFI to revise four standards, eyes sukuk

The Bahrain-based Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) will revise four of its standards in the first half of next year while expanding its guidance for Islamic bonds, the industry body said.
Earlier this month, AAOIFI issued two new standards and revised three others as it takes a more proactive approach under its new secretary general, Hamed Hassan Merah.
AAOIFI held its annual conference this week, after which it said it would seek either to revise or supplement its existing standard for sukuk, to provide the industry with more extensive guidance.
"We are...looking at the possibility of developing clearer guidance on sukuk that will incorporate accounting, legal, technical and tax-related aspects," Merah said in a statement.
Sukuk issuance is increasing worldwide but the structures used to create the instruments aren't uniform, which limits their cross-border acceptance by investors and trading in the secondary markets.

Year-to-date, sukuk issuance totals $110.9 billion through 665 deals globally, up from $97.3 billion through 703 deals a year earlier, according to Zawya, a Thomson Reuters company.
AAOIFI is also revising its accounting standards covering investment accounts, takaful (Islamic insurance), and ijara and murabaha financing structures.
A revised investment accounts standard is to be released by the end of 2014, important for Islamic banks which are seeking greater clarity on how to classify their deposits.
Consultations on takaful, ijara and murabaha will be conducted in the first half of 2015, AAOIFI said.
On takaful, AAOIFI is considering how to extend its guidance to retakaful, the issue of fixing agency fees rather than linking the fees to profits or performance, and clarifying the definition of benevolent loans (qard hassan), a conference document showed.
For ijara, a sale and lease-back contract, AAOIFI wants to clarify distinctions between operating and financing leases. Industry practice is currently not aligned with the ijara standard, known as FAS 8; proposed changes would cover income recognition, balance sheet classification, depreciation, amortisation and disclosures, according to a separate conference document.
AAOIFI's murabaha standard will be redesigned to stipulate the use of collateral for the recovery of receivables, while specifying accounting treatment and disclosure requirements, a third document showed.
The body is also engaging its counterpart in conventional finance, the London-based International Accounting Standards Board; AAOIFI invited IASB officials to its annual conference in Manama.

An IASB official said on the sidelines of the conference that his organisation would seek to develop non-binding guidance on the interpretation of their standards by Islamic financial firms, to help reduce uncertainty in the marketplace.
(Reuters / 19 November 2014)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

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