Pushing beyond the boundaries

Pushing beyond the boundaries

Pushing beyond the boundaries

Islamic finance is a natural home for structural innovation. Even the most basic Shariah-compliant products necessarily involve some degree of structuring: finding methods to mimic the economic benefits of conventional financial products while maintaining a religiously acceptable asset base. Now, though, banks are taking this structuring a step further. Chris Wright reports.

Pushing beyond the boundaries

Pushing beyond the boundaries

Demand for Islamic finance products is high. At last supply is starting to meet investors’ needs. The challenge for the industry is to ensure that the market’s infrastructure develops sufficiently quickly so that more companies and entities continue to embrace Shariah-compliant techniques. And on the following pages Euromoney profiles the winners of the latest ­Islamic finance awards.

Pushing beyond the boundaries

Compare wealth management advisors and wealth management services.

The year ahead will see the first Islamic-compliant securitizations. The question is, which jurisdiction will produce the first?

“The share price hasn’t moved for a decade. Working for Citigroup has put an extra five years onto my working life. You make a pact with the devil when you work for an investment bank, I know, but you at least expect him to keep his side of the bargain!” One disgruntled Citigroup banker bemoans having his retirement plans indefinitely delayed

Bahrain’s much anticipated retail and leisure development on Amwaj Island, has experienced overwhelming interest from potential lenders.

Middle East countries might look close geographically, but their debt regimes are very diverse. Here are the overriding factors in fixed income for the GCC region.

The Nakheel Group has sold a $2.5 billion ijara sukuk, the first equity-linked sukuk to be issued.

As Khazanah’s biggest investment, Telekom Malaysia is perhaps the most notorious symbol of the inefficiencies evident in the country’s public sector. A successful participation in an exchangeable bond and improving financial figures suggest management is starting to turn the company around but it is still falling short of its key performance indicators. Sudip Roy reports.

In July, Malaysian bank group Maybank hired a former JPMorgan corporate financier to spearhead its investment bank, Aseambankers. In his first three months Surachet Chaipatamanont has brought leadership and structure to the firm. But, as he tells Sudip Roy, there’s much more work to be done.

Expect the first true sale securitization in a matter of months.

LBO sponsors look to ABS financing solutions

Islamic investment and finance company Investment Dar will increasingly look to the sukuk market to meet its funding needs, according to its chairman and managing director, Adnan Al-Musallam, because of limited opportunities for bank finance in Kuwait.

Qatari bank aims to become world’s largest Islamic player after IPO.

A product without a market

Enormous energy is going into the creation of new Shariah-compliant finance structures for eager Middle Eastern corporates to fund themselves by appealing to Islamic investors and their growing pool of money. Every market participant expects the surging Islamic finance sector to keep on growing fast. But a key element is missing. Secondary trading in these instruments is severely limited. Sudip Roy suggests that for the recent increase in primary market activity to be sustainable, more attention needs to be devoted to trading infrastructure.

Ebrahim Sheibany is governor of Iran’s central bank, a position he has held for three years. He tells Eric Ellis in Tehran that as far as economic policy is concerned, little has changed, despite the election of Mahmoud Ahmadinejad as president.

By Alex Warren

Lebanese reforms caught in the crossfire

The country’s newly revitalized banking system throws up colourful characters and eccentric approaches to marketing. But overseeing it all is a rigorous central banker with solid US commercial banking experience. Eric Ellis reports.

Bahrain is experiencing a mutual fund boom, according to the Bahrain Monetary Authority, which says assets under management by BMA-authorized mutual funds have grown by 55% to $8.3 billion in the past year.

Dubai Investment Group subsidiary Dubai Financial has bought a 40% stake in Malaysia’s oldest Shariah-compliant bank, Bank Islam Malaysia Bhd (BIMB) – the group’s largest single investment in the Asian financial sector to date.

Bahrain I Egypt I Iran I Israel I Jordan I Kuwait I Lebanon I Morocco I Oman I Qatar I Saudi Arabia I United Arab Emirates I Lifetime Achievement As always the competition to be best bank in Lebanon is extremely fierce. Bank Audi has again performed exceptionally well but by the narrowest of margins it is this year just beaten by Bank Blom.

Azerbaijan I Kazakhstan I Kyrgyzstan I Uzbekistan Uzbekistan’s banking sector is getting into ever deeper trouble as president Islam Karimov’s increasingly repressive policies close the country off from international trade and drive the economy into crisis. Despite this, Ansher Capital still manages to survive and thrive as Uzbekistan’s leading investment bank. In the past 12 months, it managed to attract the first foreign investors into an Uzbek corporate bond. It is also looking to do a listing in the next year on the Frankfurt Stock Exchange.