Best assurance and advisory firm

Best Islamic bank in Indonesia

Best sukuk deal

A decade after Malaysia sold the first global sovereign sukuk, the market is growing from strength to strength, as are the traditional Islamic finance leaders.

Best Islamic bank in Kuwait

Best international Islamic bank

Best Islamic bank in UAE

Best Islamic bank in Asia

In its last annual report, ADCB reported strong growth in its Islamic products. Islamic product-related deposits more than doubled between year-end 2009 and year-end 2010, going from Dh7.27 billion to Dh14.98 billion ($4.07 billion). The Islamic retail loans and credit cards business grew by more than 100%. Corporate growth was slower but still strong at slightly over 20%.

Citi’s Islamic finance business has greatly enhanced its rankings in the recent past. Between December 2010 and November 2011 it acted as bookrunner for deals totalling $1.8 billion, with a 7.6% share of the market. Compare this with the same period for 2008-09; then Citi acted as bookrunner for $599 million-worth of bonds.

One of Clifford Chance’s standout deals this year was its advisory role in HSBC Middle East’s issuance of a $500 million sukuk. The sukuk incorporates an innovative dual structure, using both mudaraba and wakala elements.

HSBC Amanah continues to be the dominant global Islamic finance institution, providing wholesale, commercial and retail Islamic banking across Asia, the Middle East and Europe.

When it came to market in late November last year, the Republic of Indonesia’s second globally marketed US dollar sukuk broke barriers in its maturity and yield.

HSBC Middle East this year issued the first sukuk to employ a dual structure consisting of both wakala and mudaraba elements. This innovative structure has already been emulated by other institutions, including First Gulf Bank and Abu Dhabi Commercial Bank.

Standard Chartered was involved in a large proportion of the most important and most innovative sukuk deals of the year. These include the Republic of Indonesia sukuk – this year’s sukuk deal of year.

CIMB Islamic goes from strength to strength, and today boasts over M$40 billion ($12 billion) in assets, offering a plethora of services in wholesale and consumer banking. On the retail side, for example, the bank has extensive network coverage throughout Asia, with 1,109 branches in 14 countries.

The volume and innovative nature of deals that involved HSBC over the past 12 months make it the choice for the Islamic project finance award.

In September a consortium led by Saudi-based Acwa Power entered into an agreement to proceed with the construction of what is set to be the world’s largest independent power generation project: Qurayyah Independent Power Project. The project will be located on the eastern coast of Saudi Arabia, adjacent to facilities owned by Saudi Electricity Company, and will operate on a build, own and operate basis. The electricity generated will be delivered to Saudi Electricity Company under a 20-year power purchase agreement starting in June 2014. The project reflects growing demand for energy in the Middle East, where consumption grew from 0.7% of world totals in 1973 to 4.7% in 2009.

Malaysia has the world’s most sophisticated market for Islamic finance. Some people might quibble with that judgement: the banks are bigger in the Gulf, and the asset management volumes are bigger in Saudi Arabia. But in terms of a tried, tested, supportive, well-thought-out infrastructure within which an Islamic finance industry can flourish, Malaysia leads the field.

Riyadh-based Islamic investment house Jadwa has rapidly grown to become one of the biggest and most respected asset managers in the Islamic finance industry. Its total assets under management as at November 2011 totalled about SR6 billion ($1.6 billion).

Al Rajhi Bank’s success in Islamic banking in the Middle East has still not been eclipsed. Other banks were perhaps more aggressive before the crisis. However, since 2008 Al Rajhi’s more conservative, retail-oriented approach, resting on a 500-strong branch network, has meant that it has continued to thrive while competitors fell by the wayside.

In the eight years since its inception Takaful Ikhlas has shown some truly impressive results. It boasts more than 400,000 policyholders and has more than 52 separate products in general takaful. Takaful Ikhlas can demonstrate an average growth rate for the past four years of 36.75%.

Société Générale has built a strong franchise in structured products in conventional finance, winning the Euromoney award for best global structured products house in 2011, for example.

In June, after nearly two years of work, Indonesia-based telecom company PT Natrindo Telepon Seluler (Axis, now known as PT Axis Telekom Indonesia) completed a financing that is notable for the amount raised, its innovative nature and its complexity.

Over the year, KPMG provided assurance and advisory services to more than 65 Islamic financial institutions in the UK and Europe, the GCC, Asia-Pacific, South Asia, North America and Africa. The firm promoted Islamic finance in new markets as diverse as Russia, Africa, the Maldives and Sri Lanka.

Even while it began to grow in developed markets, Islamic finance faced key tests. Fears about the enforceability of sukuk contracts in the Middle East might have proved exaggerated, but critics of the industry’s mimicking of conventional finance remain.

Old-style capitalism is in disrepute. Fans of Islamic finance say it is a model whose ethics give it more sustainability. But optimists will be disappointed to see how far it is part of the global bust. Dominic O’Neill reports.

The growth in size, expertise and therefore competition in the Shariah-compliant market in 2008 made Euromoney’s choices for our Islamic finance awards the hardest to date. The best firms not only got bigger, they brought new levels of innovation to bear in a series of landmark deals.