Although BNP Paribas has a strong case, through its advisory work, to be named best liquidity manager, Dawnay, Day outshines the French bank. As a market intermediary Dawnay, Day has the advantage of being able to offer a mix of services and expertise that other major banks do not.
In 2006 liquidity management increased rapidly throughout the Islamic world. Dawnay, Day worked with a UAE bank to establish Shariah-compliant liquidity products. It also managed a revolving multi-asset allocation murabaha programme for 12 Islamic institutions in the Middle East to the value of $2.9 billion. “The Islamic market is still very liquid. We are looking at new instruments that offer services and solutions in this market segment. Given our shareholders and structure, we think we are well positioned to succeed at this,” says Stella Cox, managing director at DDCAP Group, the Islamic finance branch of Dawnay, Day.
During 2006 Malaysia developed its liquidity management structures, which are comparable to those in the Gulf. Dawnay, Day helped provide advice and structuring assistance to the Malaysian Islamic banks, introducing commodity-backed liquidity management solutions.
The Islamic capital markets are still dominated by primary issuance but, as they expand and integrate, so secondary markets are expected to develop in 2007.