Sunday, 29 November 2015

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

KL Conference on Islamic Finance 2015

Date    : 24-25 November 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 :

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

Among the speakers are:

- 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 

Early Bird Fee: 
Registration with payment by 30 October 2015
Malaysian   :  RM1,500
International  :  USD600

Normal Fee:
Registration with payment after 30 October 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 10% discount for 3 or more delegates registered from the same organisation and the same billing source.

(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




Grand Seasons Hotel, Kuala Lumpur - Malaysia


Kuala Lumpur


Pakistan is upbeat on Islamic banking

Upbeat on shariah-compliant modes, Pakistan has just launched Islamic branchless banking claiming it to be "the first" - globally.
At the same time, State Bank of Pakistan (SBP), the central bank, just unveiled vast opportunities for foreign and domestic investors to come into the fold of all types of conventional and Islamic banking to invest and earn big dividends.
The first to take up the Branchless Islamic Banking (BIB) are Kuwait-based Meezan Bank and Ufone, a subsidiary of Pakistan Telecommunications Corporation (PTCL), partly owned by etisalat. The new ventures will carry the brand name of "Meezan-Upaisa," and it is the only Shariah-based branchless banking service.
The other cellphone-based branchless conventional banking in the country are Mobicash Waseela Bank operated by Mobilink, EasyPaisa-Tameer launched in cooperation with Norway-based Telenor, Ypaisa-U bank of Ufone and Timepey-Askari Bank.
While launching the new BIB customer service across Pakistan, SBP governor Ashraf Mahmood Wathra said this is the first product of its kind, not only in Pakistan, but in the whole world. "We have granted the permission to launch this unique service in order to facilitate 95 per cent of Pakistanis who will like to deal only with Islamic banking services, and have remained away from the current conventional banking services, because of their Islamic faith," Wathra said.
SBP, which recently conducted a survey 'Knowledge, attitude and practices of Islamic banking in Pakistan', said there is an overwhelming, and evenly distributed, demand in the urban and rural areas of the country for Islamic banking. The demand for Islamic banking is as high as 95 per cent among the households at the retail level. "Demand stands at 73 per cent among the businessmen," according to the SBP survey, which is based on 9,000 households nationwide and includes banked and non-banked customers, and 1,000 corporates. Meezan Bank and Ufone took a full year to develop the BIB model, which has now been launched.
Win-win situation
"With this new collaboration, we aim to capitalise on the strength of both the parties - Meezan Bank's strength in Islamic banking and Upaisa's geographic footprint in facilitating customers, making it a win-win situation for all. This is because Upaisa is at the forefront in providing branchless banking services, and its collaboration at various levels and Meezan Bank holding over 50 per cent of the Islamic banking share in Pakistan," Ufone President Abdul Aziz said.
Asher Yaqub Khan, chief commercial officer of Ufone, said Islamic branchless banking will accelerate the goal of financial inclusion of the economy to a great extent.
President and chief executive of Meezan Bank Irfan Siddiqui said his bank has played a vital role in expanding access to Islamic financial services in Pakistan. "This initiative is poised to accelerate financial inclusion by adding convenience and greater reliability, deepening the role of Ufone through enhancing the value it provides to its customers and that of Meezan Bank in expanding the reach of Islamic financial services to every citizen in the country."
The two partners - Meezan Bank and Ufone - hope that their partnership will expand Islamic system footprint to its maximum potential customers and facilitate them to avail branchless banking services with utmost ease and convenience under the Islamic system. This will be the fist milestone in the ambit of Islamic branchless banking.
"Our partnership will provide the service at 10,000 points of service across 500 cities, districts and  villages. BIB will not only promote micro-financing but also finance for agriculture and small businessmen. It will also encourage savings by the general public, based on profit and loss model."
What is the size and scope of banking, and branchless banking, both in the conventional and Islamic modes? Wathra indicated this on the basis of current surveys conducted by the central bank.
Speaking at the launch of the Meezan Bank Ufone initiative he said it has opened up several new opportunities for the entire banking sector, as it will provide access to the people of low income groups. "There are 12,000 bank branches, 95 per cent of which are online, whereas 25,0000 branchless banking agents are serving low-cost and convenient access points. They are serving the needs of masses for cash-in and cash-out, domestic remittances, and bill payments."
Wathra also said that at present 9,600 ATMs have been installed, which are inter-connected through a local switch, providing payment facilities at merchant points. He said 42 million bank accounts have been opened, about 26 million plastic cards have been issued, and over 10 million mobile-wallet accounts are offering basic financial services on finger tips.
"Inspite of this big expansion of the banking services, there is no room for complacency. Pakistan, where 190 million people reside in geographically diverse areas, only 23 per cent of the adults currently avail any form of financial service. The access of people to a formal bank account is only 16 per cent, whereas only two per cent of adults have availed any form of formal credit. It is quite evident that the conventional approach of brick and mortar branches will never adequately serve the millions of unbanked masses in Pakistan," Wathra said.
SBP's recent surveys show that the market share of branchless or mobile-based, conventional banking mode Easy-Paisa is 54 per cent, United Bank's UBL-Omni 20 per cent, Mobicash of Mobilink 14 per cent and Ufone's Upaisa four per cent.

It shows that as far as the future of all types of banking services is concerned, sky is the limit. And here lies the vast money making opportunities for foreign and domestic investors and banks to make good dividends.
(Khleej Times / 29 November 2015)
Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

New insights on outlook of global Islamic finance to be unveiled

MANAMA — The convener of the 22-year World Islamic Banking Conference (WIBC) — Middle East Global Advisors — is set to reveal cutting-edge insights on the outlook of the global Islamic financial industry in its inaugural “Finance Forward Islamic Finance Outlook Report 2016” this December.
The “Finance Forward Islamic Finance Outlook Report 2016” will be launched on Dec. 1 during the World Islamic Banking Conference in Bahrain. The three-day conference will cover various areas related to Islamic banking in the current global financial environment.
Speaking ahead of the presentation of the report — to be launched at WIBC itself — Dr. Sayd Farook, vice chairman and CEO of Middle East Global Advisors, shared: “The Outlook Report is expected to serve as a compass for Islamic Finance leaders who are undertaking key decisions that will fundamentally shape their business strategies for 2016.”
The uniqueness of the report, he continued, is that it combines meaningful insights from Islamic finance leaders — gathered from an extensive survey of practitioners’ sentiment — with robust analysis of the performance of Islamic financial institutions.
According to the report, three major global macro developments of 2015 will shape the outlook of the industry: commodity prices (particularly oil), development in global interest rate policy, and a slowdown of the Chinese economy. Low commodity prices do not bode well for either the Gulf Cooperation Council or Southeast Asian economies, home to most of the world’s Islamic banks.
However, a positive outcome for Islamic banks in a ‘new normal’ of low oil prices is that they enter with low rates of non-performing loans, high liquidity (in part due to the limited liquidity management options), high capital levels and simple balance sheets with mostly Tier 1 capital overall.
Thus, while the outlook for Islamic banks is likely to be muted going forward (and some may even face some fall-off in profitability), many leading Islamic banks have built up their resilience in the face of tightening liquidity, slowing loan growth and worsening credit risks.

Survey results of the Outlook Report highlighted two key trends: the development of ethical business models and that of Digital Banking.
Speaking about the importance of these trends, Blake Goud, chief research officer at Middle East Global Advisors added, “Shariah compliance is necessary but not sufficient for consumers demanding ethical financial services. This implies that corporate social responsibility is not enough — consumers want their financial institutions to integrate an ethical approach into their core business mode.

(Saudi Gazette / 29 November 2015)
Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

Sunday, 22 November 2015

Turkish watchdog to revise Islamic banking regulations

The head of Turkey’s banking watchdog has pledged to revise the regulations governing the Islamic banking sector to increase the popularity of the sector in the country.

Mehmet Ali Akben, president of the Banking Regulation and Supervision Agency (BDDK), said there was a strong need for changes to the rules governing what are known as “participation banks” in Turkey.

“We are trying to readjust those rules,” he told an Islamic finance conference in Istanbul on Nov. 19. “We believe this system will shine on both a local and global scale in the coming years.”

He said there was a demand for a financial model working under non-interest-based rules and that the BDDK had launched a separate body to analyze how Islamic finance could be developed and popularized in Turkey.

Launch of sharia boards for Islamic banking 

Akben said the BDDK would launch the required regulations enabling the system to grow further in Turkey and to become exemplary around the world. 

“In this vein, should the sharia boards be under the direction of the BDDK? ... There have plans to launch these boards under the Association of the Participation Banks, but this issue could be reassessed to determine which option is best,” he said.  

 Talat Ulussever, chairman of the Borsa Istanbul exchange, called for a system in which members of the public could invest in major projects.

“We need to exert effort to establish financial structures in which Turkey’s big projects in areas such as energy, communication, defense and infrastructure will be financed by people as profit is shared by them,” he said.

Ulussever said the 2008 financial crisis showed that conventional finance could not absorb volatility in global markets.

“There is a recent survey by the OECD that indicates financing through credit has a negative affect while economies that prefer stock exchanges for their financing needs grow faster and sustainably,” he said.

(Daily News  22 November 2015)
Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

Turkey shows progress in developing Islamic finance

Experts who attended at a G20 conference on Islamic finance in Istanbul have pointed to Turkey's progress in developing the sector.
Aysegul Eksit, executive vice chair at the Capital Markets Board of Turkey, said that the Turkish government is hard at work to create better enabling conditions for Islamic finance.
Islamic lenders now account for about 5.3 percent of Turkish banks' total assets, and this is more than twice the level a decade ago, Eksit said.
The value of Islamic finance assets in Turkey was $51.2 billion in 2014, making the country the eighth in the world. Only about 3.6 percent of global sukuk issuance comes from Turkey, according to World Bank statistics.
Sukuk are instruments similar to bonds, but in which asset growth provides income as opposed to the collection of interest which is forbidden under Sharia law.
“The Turkish legal framework for the issuance of sukuk is in the process of completion. Laws passed in 2012 and 2013 have established the use of these instruments,” Eksit said.
But there are still legal obstacles to the development of the sukuk market in Turkey, Eksit pointed out.
“There are still tax-related issues that limit the development of sukuk in Turkey. But there is work currently underway at the Ministry of Finance to overcome these obstacles,” Eksit said.
For now, almost all sukuk issuance in Turkey is made by participation banks and the Turkish Treasury.
In 2014, the Treasury has also created the basis for a wider range of Islamic finance instruments, such as “Mudarabah”, or investment based on profit sharing; “Murabahah”, in which a buyer purchases from a seller at a fixed profit margin; “Musharakah”, which allows each party involved in a business to share in the profits and risks; and “Wakalah”, which refers to a type of Takaful insurance contract.
“Corporates still do not issue sukuk, although there is no legal obstacle to their doing so,” Eksit said.
There are four private Islamic banks operating in Turkey for many years: Albaraka Turk, Bank Asya, Kuveyt Turk, and Turkiye Finans.
The sector employs about 16,000 people, and is growing at about 32 percent per year, relatively faster than the rest of banks in Turkey.
But on Oct. 15, the Banking Regulation and Supervision Agency (BDDK) allowed state-owned Ziraat Bank to establish an Islamic banking branch, and this opened on May 29.
State-owned VakifBank has also received a license for Islamic finance operations in Turkey.
“This is a game changer,” commented Khalid Howladar, global head of Islamic Finance at credit agency Moody’s.
“The market in Turkey has been small, but the entrance of these large state-owned banks, with thousands of points of distribution among them, should be a major step into growing the market. The large banks are also likely to involve corporates in the market for the first time,” Howladar said.
Turkey also boasts four Sharia-compliant pension funds, although assets under management remain low by global standards -- total value of investment in individual Turkish pension system is at about $14 billion, according to OECD statistics.

But the entire pension sector has invested in sukuk in the past, and is expected to show a considerable interest in sukuk as the instrument and the market becomes more mature in Turkey, Eksit said.
(Anadolu Agency / 21 November 2015)
Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

Tuesday, 17 November 2015

Bahrain's growing stature in Islamic banking underlined

Manama, Nov 16 (BNA): CEO Khalid Hamad of Banking Supervision at Central Bank of Bahrain highlighted Bahrain's leading standing attained in the world of Islamic banking through the adoption and development of the Islamic banking.

In a press conference held today at the Bahrain Stock Exchange to review the details of the World Islamic Banking Conference 2015, Hamad asserted that many of the developed and developing countries have resorted to Bahraini expertise and its qualitative initiatives in the field of Islamic banking. 

He attributed Bahrain's success to the sound Islamic banking policies followed, commitment to legitimate controls and implementation of best accounting and auditing standards in the Islamic banking sector. He called for investing in education, training, agriculture and health areas. 

(Bahrain News Agency / 16 November 2015)

Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

Turkey a Rare Bright Spot in Islamic Finance's Forgettable Year

In a year to forget for the Islamic finance industry, this month’s Turkish election may prove the high point.
Two Turkish banks, Kuveyt Turk and Albaraka Turk, are marketing international sukuk issues this week in what may herald a revival of the Shariah-compliant industry in the country after the AK Party regained its parliamentary majority this month. The government’s Islamic drive had foundered following a previously inconclusive election in June as sukuk sales dwindled and the largest-listed state lender halted plans to set up a Shariah-compliant unit.
“A lot of the transactions that were on hold are being dusted off right now," Rizwan H. Kanji, a Dubai-based partner at law firm King & Spalding LLP who structures Islamic deals, said by phone from Riyadh. “We’re in the next phase of the growth of participation banking in Turkey."
The return to majority rule of the party co-founded by Turkish President Recep Tayyip Erdogan comes at a time when global sales of sukuk are heading for their slowest year since 2010. The AK Party has introduced Islamic units at state banks and expanded Shariah-compliant finance education at universities.

Unmet Demand

Kuveyt Turk meets investors this week before a potential $400 million sukuk sale, while Albaraka started meetings Nov. 13 before a Tier 2 subordinated offering.
Economic and political stability in Turkey will boost investor confidence and participation banking will be a direct beneficiary, according to Ashar Nazim, a partner at Ernst & Young LLP’s Global Islamic Banking Center. Untapped demand for banking that adheres to the religion’s ban on interest means the industry could expand as much as 10-fold in Turkey, he said.
"There’s no need to rush," said Melih Murat Borekci, the London-based co-head of equity research at Yapi Kredi Yatirim, a Turkish brokerage. "I don’t think that there will be a change to AK Party’s intention to establish state presence in participation banking, but there could be changes to the previous economy management. New appointees would need time set their own plans and timeline.”
Halkbank, the country’s biggest state-controlled publicly traded lender, withdrew its application for an Islamic banking unit before this month’s elections. Plans to start a new unit would be clear in two to three months, Chief Executive Officer Ali Fuat Taskesenlioglu said in October.
Despite Erdogan’s ambition to increase the proportion of Shariah-compliant banking assets to much as 20 percent of the market by 2023, for several years they haven’t gained market share. In September they were at 5.1 percent, their lowest as a percentage of the entire industry’s assets in almost three years.

New Units

Turkey’s cabinet appointed Mehmet Ali Akben, a career Islamic banker who has worked at two of the country’s five Shariah-compliant banks, to lead the Banking Regulation and Supervision Agency in May. The regulator approved state-run Ziraat Bank’s Islamic unit the same month.
Vakifbank’s main shareholder got the regulator’s nod for its own unit a month later, while Halkbank looks poised to revive its plans.

"Ziraat participation arm is already in action, we’re going to see another two state banks set up these units in the first half 2016 and we’ll have three participation banks,” said Aykut Ahlatcioglu, a banking analyst at Istanbul-based brokerage Oyak Menkul Degerler AS. "Participation banking will grow faster than their conventional peers.
(Bloomberg Business / 16 November 2015)

Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

Alfalah Consulting's facebook