Saturday, 30 April 2016

Event Summary (KLCIF2016) - KL Conference on Islamic Finance 2016

KL Conference on Islamic Finance 2016

Date    : 17-18 May 2016
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 22 April 2016
Malaysian   :  RM1,500
International  :  USD600

Normal Fee:
Registration with payment after 22 April 2016
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

Nigeria: MUSWEN Moves to Strengthen Zakat Collection

Plans are underway by the Muslims Umah of South West Nigeria (MUSWEN) to strengthen Zakat collection to assist more indigent Muslims and solve some social problems confronting them.
However, the group has bemoaned the spate of insurgency in the country, urging the Federal Government to put in place proper mechanism to guarantee security of lives and properties.
The group, in a communiqué made available to The Guardian after its second general assembly meeting in Ibadan condemned the bloody and destructive activities of Boko Haram insurgents who are masquerading under the garb of Islam to perpetrate unprecedented atrocities in some parts of the country.
MUSWEN, in a statement signed by its Chairman, Sakariyau Olayiwola Babalola insisted that Islam stands for peace in all ramifications adding that such atrocities was grossly antithetical to the tenets of Islam.
Besides, it called on the Federal Government to quickly devise a means to address the fundamental causes of insecurity in the land and make frantic efforts to rescue the Chibok girls.
It therefore enjoined Muslims to organize special prayers for the nation. "That the political situation in the country today, when combined with the well known insecurity has become so dangerous that only constant prayer can rescue it. MUSWEN therefore calls for such prayers from all and sundry,"
MUSWEN at the meeting however established a Muslim Elders' Forum for the southwest to address some socio-economic and political issues affecting Muslims, which were often overlooked by an existing Yoruba Elders' Council and similar bodies in the region.
Worried about the present economic situation of the country, particularly as being affected by the crash in crude oil prices, It insisted that, existing agricultural policies should be quickly implemented by the federal and state governments to engage millions of Nigerian youth as a way of curbing unnecessary restiveness in the society.
The group also noted that the overwhelming poverty within the Ummah betrays the preponderance of the meaningful Muslim population in Nigeria, which forms a great workforce that should help to stabilize the economic and political harmony of the country.
"Nigerian Muslims are incessantly confronted by two major problems: One is poverty. The other is ignorance. Whereas a solution to one of these two problems can automatically pave way for the solution to the other. However, no serious attention seems to have been paid to such solution for a long time," it stated.

It further called all Nigerians, irrespective of their ethnic and religious backgrounds, should come together to rally round the present government especially President Muhammad Buhari in solving the multifarious problems staring the Nigerian people on the face.

(All Africa / 29 April 2016)
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Malaysian sukuk issuance jumps 50.5pc to RM22.8b

KUALA LUMPUR, April 29 — Malaysian sukuk issuance jumped 50.5 per cent to RM22.8 billion in the first two months of 2016, compared to RM15.1 billion for the same period in 2015, says RAM Ratings.
Notably, this made a significant contribution to global sukuk issuance figures, it said in a statement today.
The top three sukuk global issuers in February 2016 were all Malaysia-based Danga Capital Bhd (US$2.3 billion — RM8.946), International Islamic Liquidity Management (US$1.3 billion), and the Government of Malaysia (US$1.1 billion).
“A total of US$8.9 billion of global sukuk was issued the same month, bringing the year-to-date (YTD) issuance to US$12.3 billion as at end-February 2016,” it said.
In the latest issue of its Sukuk Snapshot, designed as a quick reference point for sukuk data and trends, RAM highlights that a total of RM14.4 billion of domestic sukuk was issued in February, leading to a YTD issuance value of RM22.8 billion.
RAM’s Head Islamic Finance, Ruslena Ramli, said: “Malaysia is holding its ground, with 53.9 per cent of the world’s outstanding sukuk.”
Meanwhile, corporate sukuk issuance also picked up, making it the largest contributor (69 per cent) of domestic sukuk issues, followed by government sukuk (31 per cent).

(Malay Mail Online / 29 April 2016)
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Wednesday, 27 April 2016

Dubai Sukuk listings top $42bn

The value of Sukuk listings in Dubai has topped $42.61bn following the ringing of the bell by Islamic Corporation for the Development of the Private Sector yesterday for its $300m issue.
The Islamic Development Bank Group private sector arm said the total nominal value of Sukuk in the emirate was higher than any other centre globally, making it a leader in the Islamic bond sector.
“Using the funds raised by this Sukuk, we will further pursue our mission to provide financing and investment for a range of successful private enterprise projects in our member countries,” said ICD chief executive Khaled Al Aboodi.
The Islamic Devleopment Bank has seven other Sukuk outstanding on Nasdaq Dubai, following its first listing in 2014, with a total nominal value of $8.05bn.
The most recent Sukuk listed on April 14.

ICD has an authorised capital of $4bn and is jointly held by the IDB, 52 Islamic countries and five public financial institutions.
(Gulf Business / 26 April 2016)
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Tuesday, 26 April 2016

Dubai sukuk listings hit $42.61 billion

The total nominal value of sukuk currently listed in Dubai has now reached $42.61 billion, more than the value listed in any other centre globally and reinforcing the emirate's leadership role in the Islamic bond sector.
Khaled Al Aboodi, chief executive officer of the Islamic Corporation for the Development of the Private Sector (ICD), on Monday rang the market-opening bell to celebrate the listing of a $300 million sukuk on Nasdaq Dubai.
The ceremony was attended by Essa Kazim, Governor of the Dubai International Financial Centre, secretary-general of the Dubai Islamic Economy Development Centre and chairman of the Dubai Financial Market; Abdul Wahed Al Fahim, chairman of Nasdaq Dubai; and Hamed Ali, chief executive officer of Nasdaq Dubai.
"Using the funds raised by this sukuk, we will further pursue our mission to provide financing and investment for a range of successful private enterprise projects in our member countries. As the international exchange serving the region, Nasdaq Dubai provides us with close links to investors in and beyond the Muslim world as well as global visibility and world-class listing infrastructure," Al Aboodi said.
"Dubai is delighted to support the valuable activities of ICD by providing its capital markets infrastructure to host its sukuk. This listing by a prominent multilateral entity gives further impetus to Dubai's growth as the global capital of the Islamic economy, under the initiative launched by His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai," Kazim added.
The sukuk issued by ICD, the private sector arm of the Islamic Development Bank Group, listed on April 14, 2016. IDB has seven other sukuk currently outstanding on Nasdaq Dubai that have listed since 2014, with a total nominal value of $8.05 billion.
Al Fahim said: "The exchange looks forward to welcoming many more sukuk listings from international and regional public and private sector bodies. As we continue to build critical mass in the Islamic capital markets sector, we will extend the range and scope of the services that we offer to market participants including developing new products and further strengthening our links to investors."

Ali said: "Our growing relationship with the IDB group demonstrates our commitment to serving Shariah-compliant issuers wherever they are based, providing visibility and close links with investors. We are also strengthening our ties with issuers around the world that are new entrants to the Islamic capital markets and will benefit from a relationship with the world's leading sukuk exchange.

(Khaleej Times News / 25 April 2016)
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Promising prospects for greater growth of Takaful in the UAE

Dubai: The recent 11th Annual World Takaful Conference in Dubai was an eye opener with regards to the growing number of Takaful operators, and the intense interest in building the Takaful industry and ensuring greater options and benefits for customers.
The Takaful sector is at a promising stage in its development. Although its growth has been fast, there are several challenges and opportunities that the industry as a whole must address, or take advantage of. A key challenge for Takaful companies has been differentiating their product offerings from conventional insurers - which has eroded the value of Takaful operators in an already fiercely competitive market.
In essence, Takaful is based on the concept of mutual indemnification - an agreement that helps all parties involved in cases of loss of health, life or property. Based on ‘risk sharing’, this concept is an alternative method to the more popular ‘risk transfer’ principle used in the conventional insurance space. Takaful is based on the mutual help and cooperation of all the owners of the participant fund, which is basically a risk pool that is made up of participant contributions. In addition, it does not engage in interest-based activities and invests the contributions made by the participants and shareholders in Shari’a compliant securities.
Within the UAE, Takaful products are sold mainly through broker and agency/ advisor distribution channels. In contrast, in Malaysia, Islamic banks are being utilised for their existing customer base to provide a whole new distribution channel to Takaful operators known as bancatakaful. As a result, Takaful operators within the UAE are now quickly catching on to leverage bank distribution for Takaful products. Noor Takaful, for example, has leveraged on its relationship with Islamic banks and led the market with unique new products such as ‘Smart Save Plus’ and a ‘Single Pay Jumbo Plan’ which are sold mainly through the bancatakaful distribution channel.

So far, Middle Eastern Takaful operators have concentrated almost 90 per cent of their takaful activities in the non-life sector of Islamic insurance, whereas in Malaysia, that number is a complete reciprocal, building almost 75% of their activity from within the life sector of Takaful. According to the Dubai Center for Islamic Banking and Finance (DCIBF), only 5 out of the 16 Takaful operators produced a surplus in 2014 in the GCC region. In Asia, that number is even lower - sitting at just 10% of 56 Takaful operators who have produced positive results between 2011- 2013.
In order for Takaful companies to grow, they must focus on customer centricity, the innovation of new products/services, adhering to the customer’s needs, and the implementation of technological enhancements within the organisation - that allows for accurate assessment of risks, while at the same time maintaining the core Islamic values on which Takaful is built.
With readily available information now online, customers are more aware of their needs today than ever before. These buyers have an abundance of options to select from when it comes to Takaful products/services, and Takaful companies need to make more information and products available through online access.
Although both Islamic Takaful and Islamic Banking started at the same point in time in history - around the 1970’s – according to the same DCIBF report, the banking sector has taken off to a massive global revenue size of 1 trillion dollars, whereas the Takaful sector has yet to reach the 50 billion dollar mark from a revenue perspective.
With its relatively new entry into the region as compared to its conventional counterpart, the challenge for the Takaful industry and specifically the Takaful operators to achieve full potential, is to bring new products and technologies to customers, and offer a reasonable pricing of risks alongside efficient business processes.
There is significant potential for consolidation among regional Takaful operators. Countries like Indonesia and Malaysia, for example, with significantly larger populations that the GCC, have achieved deeper penetration with fewer Takaful operators.
Consolidation of Takaful companies in the future may boost growth prospects by instilling greater confidence among customers. Fewer and larger Takaful companies, with larger financial resources will lead to greater financial stability and better ability to compete while focusing on improved risk pricing. In addition, customer trust must be promoted by focusing on corporate governance and ensuring adherence to new regulatory standards. For example, with the recent regulatory changes, new opportunities to demonstrate customer value are opening up, such as mandatory medical insurance and better customer service and response times, all of which point to prospects for greater growth for Takaful companies, especially in the UAE.
The writer is the CEO of Noor Takaful. Views expressed in the column are the writer’s own and do not reflect that of the newspaper.

(Gulf News Banking / 25 April 2016)
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Monday, 25 April 2016

INCEIF takes islamic finance education to a global level

Daud Vicary Abdullah is a British converted Muslim who since 2011 has been President and CEO of INCEIF, the International Centre for Islamic Finance. Also known as the Global University for Islamic Finance, INCEIF was founded in 2006 by Bank Negara Malaysia, the Central Bank, to attend to the need for human capital development in this field. Since then, its leaders have worked to establish the institution as an elite education center
Education is one of the main challenges, not only in Malaysia but in the world. Can you explain what you are doing at INCEIF and why it is so important?
Malaysia has grown and developed its Islamic finance sector and it has grown quite steadily internally. And there was a reasonable array of self-taught experts. First, there was the creation of Bank Islam and then we started a second bank and opened Islamic windows, and thirdly, we thought about moving away from Islamic windows and having separate banks or subsidiaries. At that point, from about 2003 to 2005, it started becoming obvious that Islamic banking was really taking off and along with it came a huge shortage of skilled and capable resources to lead this kind of expansion. In 2005 I was the first managing director of a new Islamic bank.

There were some “major stars” in the market and companies paid large transfer fees to get them. The central bank paid attention to this problem and did many things. For example, they implemented a scheme by which if you wanted to do this high transfer fee thing, you had to pay a penalty: you had to pay six months’ salary into a fund, which was controlled by the Central Bank. And that fund started funding projects. A part of this was used to set up INCEIF.

There was no specific Islamic finance higher education programs before. The first one, the Chartered Islamic Finance Professional, was launched in 2007. Between 2005 and 2011 - when I was appointed here, not as an academic but as an industry expert - the university grew and developed, forming a number of strategic relationships with other universities around the world to provide Islamic finance education while extending its own repertoire: it started taking on Ph.D research students and it also developed a more academic Master’s program.

We currently have close to 2,000 students from 85 countries; 1,200 of those students are online, they do not come to campus. So we have built a global network. We have a reasonable number of UK students. Our number of students has grown a lot and so has our credibility. We have forged partnerships with important finance institutions. Two years ago, we were considered an official partner of the World Bank, which partners only with two other universities in the world: Oxford and Harvard. We are being assessed now by international business school standards by the AACSB (The Association to Advance Collegiate Schools of Business), in order to become globally accredited. A lot of this has been reached through the vision of Governor Zeti (Tan Sri Dato’ Sri Dr. Zeti Akhtar Aziz, Governor of Bank Negara Malaysia), and many others, but she has been very much the driving force. She has been the most significant figure in Islamic finance.

Why would you say she is such a crucial and respected figure?
Well, I think she is a remarkably good strategist who can actually execute. She has understood the value of Islamic finance.

In my opinion, the most important things in Islamic finance are education, perception and liquidity. Education is vital at every level, and with education you change perceptions. Liquidity is a common issue everywhere nowadays.

Do you think the trend of speculation in the financial economy will continue?
It would be nice to get back to reality in terms of the economy and the concept of risk sharing. With the financial crisis, people lost what they had invested and share values went down, some banks went belly-up and therefore the government had to raise taxes to cover the losses. Individuals were hit three ways, because somebody else has not been held accountable for what they have done. They bet the balance sheet of the bank and it all went wrong, and they did not have any liquidity. To me, this is what happened to Lehman Brothers and others. I am not saying this could not happen in Islamic finance, because everybody is human and greed is human nature - most of what happened was just based on greed. But we need to go back to a level of ethics and then apply those ethics. They are beneficial to all of humanity.

This is the challenge. I think we have more of a challenge after the crisis and the more we get this across, the more we can be sure there is actually an opportunity to get people to change their mind. We have to get back to a level of reality and not only about finances, but also about ecological matters, climate change and other issues.  

How can Islamic finance compete with traditional, conventional finance?
Islamic finance has been growing to where it is today largely because it has used conventional tactics or conventional instruments. Now, there is a big opportunity to use new risk-sharing instruments. All the regulations in the world, in banking and finance, are based on debt. However, if you go into a risk-sharing environment, you do not need Basel III because you are actually trying to educate all parties by saying “Do you understand the risk you are going to put your money at here?” We have to explain this clearly - education changes perception. The man in the street is starting to ask questions: “What is going on here? Can we trust the bankers? Can we trust the regulators?”

We are working to start changing perceptions at an early age. We have students working on programs in primary schools about risk sharing. The idea is that people get education early, through play and interaction, and see this not as a religious threat but as a set of options about which they can make realistic choices. And they understand the concepts.

A lot of lawyers are starting to get on board with your INCEIF programs. Can you tell us a little more about this?
The legal profession is really engaged with Islamic finance and any form of finance, because they are in charge of the contracts and deals. British lawyers, as they work in international law firms, have always had the expertise on Islamic finance and they are very good at it. Now, we are partnering with the Chartered Institute of Arbitrators in London to develop a course which educates their members, who are legal professionals who focus on arbitration, and on what happens in the world of Islamic finance.

I think the future of Islamic finance will not rest heavily on it, but an important building block will be professional accreditation.

What would be your advice, or your selling point, regarding the competitive advantage of a sukuk to an English corporation who perhaps does not understand it?
A sukuk looks and feels like a bond, but it is not a bond, because it does not give you interest. It is an attractive vehicle. The market is growing so you can raise funds cheaply, for example, here in Malaysia.

A few of our readers may be thinking “Should I contact INCEIF? Should I look at doing something to get qualifications in Islamic finance?” What would be your rationale for somebody in the UK, for example, to join this university?
Islamic finance is a growing industry. It is growing faster than the overall finance industry. So, becoming an expert is not a necessity, but having some awareness of it will differentiate you from the rest, because a part of your business is going to touch Islamic finance at some point. Of course you do not need to be a Muslim to study with us. 

(The Worldfolio / 25 April 2016)
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