Dow Jones Islamic Market Amana Sri Lanka Index records a gain

At the end of Monday's trading, the Dow Jones Islamic Market Amana Sri Lanka Index (DJIMSL) recorded a gain, while the Dow Jones Sri Lanka Index (DJSL) Dow Jones Titans 20 Index (DJSL20) remained virtually unchanged.

The total turnover for the day soared to Rs. 3.50 billion, which was mainly attributable to 18 crossings that took place on SLT shares. The counter recorded a value of Rs.2.58 billion, representing 74% of daily turnover. During the day, 51.98 million SLT shares were traded, of which 49.83 million shares changed hands in the form of crossings between a price range of Rs. 49.25 and Rs.49.75 per share. The second and third highest contributors to daily turnover were Hotel Services (Rs.542.63 million, which included two crossings on 3.93 million shares at Rs. 138.00 per share) and DFCC (Rs. 48.09 million, which included a crossing on 355,000 shares at Rs.125.00 per share).

The DJSL20 Index gained 0.06 points (0.03%) to close at 172.52 points. AMW was the main positive contributor to the index with its weighted average share price appreciating by Rs.22.75, while the Rs.0.50 decline in the weighted average share price of Dialog led to the counter becoming the main negative contributor. The DJIMSL Index surged by 38.85 points to close at 1,189.05 points. AMW and Dialog were the main positive and negative contributors to this Index as well.

Information provided by Amana Securities Ltd.

Fukui Sees Islamic Finance Spurring Global Market Growth

TOKYO (Nikkei)--In his opening speech at the Nikkei Islamic Finance Symposium in Tokyo Saturday, Bank of Japan Governor Toshihiko Fukui said, "Development of the Islamic form of finance will contribute to diversifying the international financial market and transactions" and help fuel an expansion in the market and business opportunities.

Islamic finance is now an essential factor in understanding the international financial mechanism, Fukui said.

He pointed out that diversity in Islamic financial services is "important also from the perspective of stability in the financial markets or systems" and thus "has a positive impact on the world economy" by improving the function of distributing resources around the globe.

 However, Fukui also referred to problems with Islamic finance, saying, "Not a few aspects of this form of finance still remain unknown," including the way of arbitrage trading between Islamic financial vehicles and conventional financial products.

Fukui expressed his hope that such global organs as the Islamic Financial Services Board and the Accounting and Auditing Organization for Islamic Financial Institutions will play even more active roles in pursuing "healthy and stable Islamic financial services."

Govt unable to float Baitulmaal Certificates, says Shamshad

By By our correspondent
2/22/2008
KARACHI: The Governor State Bank of Pakistan (SBP) Dr Shamshad Akhtar has said the government is unable to introduce Baitulmal Certificates (Shariah- compliant government treasury bills) presently, due to complexity and non-availability of assets backing.

She expressed these views after inaugurating the 100th branch of Meezan Bank here on Thursday. She said that there were several formulas under consideration for the liquidity management of Islamic banking, and central bank would hold a meeting with the ministry of finance shortly to consider the viability of the instruments.

Dr Akhtar stressed upon the Islamic Banking Institutions (IBIs) to increase their penetration in rural areas of the country and diversify their network for the benefit of the underserved segments of the society and focus on farm and non-farm based lending.

She said the new licensing policy of SBP was 'very liberal', under which each bank was required to set up at least 20 per cent of total branches in rural areas.

SBP Governor said under the policy, the State Bank allowed microfinance banks to open as many branches as they wanted in the rural areas. "Islamic banks may also be allowed to set up as many branches in rural areas as they want," she directed. She said that there is a unique opportunity for Islamic banks to conduct infrastructure financing and long-term lending. She also said that the rural areas of Pakistan have great potential for growth, and that Islamic banking could play a pivotal role in the development of these areas.

She said that rural prosperity had increased over the years and the capacity to buy and save was higher in rural areas.

Congratulating Meezan Bank's management for accomplishing a network of 100 branches in a span of just five years, Governor State Bank said that Meezan Bank's historic growth was the success story of Islamic banking in Pakistan.

Speaking on the occasion, Irfan Siddiqui, President and CEO of Meezan Bank said that Meezan Bank, the first and largest Islamic Bank in Pakistan was committed to fulfilling its vision of establishing Islamic Banking as the banking of first choice. He went on to notify that Meezan Bank was now spread out over 31 cities of Pakistan, and that branch expansion was bound to continue during 2008, making the bank one of the fastest growing banks in the history of Pakistan.

Siddiqui further communicated that there are currently six dedicated Islamic Banks operating in Pakistan, with a total of 186 branches besides the 102 stand alone Islamic Banking branches of conventional banks. "Meezan Bank's share of branch network is now 55 per cent of the total, making it the largest Islamic Bank operating in Pakistan by a significant margin." He said that Meezan bank would continue to expand its branch network in 2008 with the addition of 50 more branches, thus, establishing a network of 150 branches across Pakistan by the end of 2008.

Infosys unveils Finacle 10 with new set of offerings

20 Feb, 2008, 1938 hrs IST, PTI

BANGALORE: Infosys Technologies Limited on Wednesday announced the launch of Finacle 10, the latest version of its universal banking solution, with a new set of offerings including Islamic banking.

The Bangalore-headquartered firm said it's a highly sophisticated and advanced system that has been built with efforts of over 240,000 person days.

Member of Infosys Board, T V Mohandas Pai, told news conference here that Finacle 100 has 40 million lines of codes, enables 100 million transactions per hour and can be used by 130,000 users concurrently.

The new set of offerings in Finacle 10 include Islamic banking, wealth management and an enhanced mobile banking solution.

"Finacle is core to our growth strategy. We have invested over $60 million in the last three years to build a state-of-the-art banking solution", Pai said.

Business Head, Finacle, Haragopal M, said Finacle 10 has multi-country infrastructure and tranformational capabilities that deliver increased productivity, rapid innovation and a comprehensive set of offerings to meet diverse customer demands.

"Seven Tier-I and Tier-2 banks around the world have already signed up for Finacle 10", he said.

NASDAQ-listed Infosys expects Finacle product to contribut $145 million to $150 million to the company's overall revenues for the year ending March 31, 2008. Finacle has been deployed by 105 banks in 60 countries.

Islamic mortgage panel launched by eConveyancer

Monday 18th February 2008

eConveyancer, the online service which enables intermediaries to select and instruct conveyancers on behalf of their clients, is launching a specialist panel of solicitors capable of managing Islamic mortgage applications.

The new service will be available nationwide and will focus on law firms who understand the requirements of Shariah compliant mortgages. Under Islamic law, money must not generate money (which must be the result of work) and Riba, or interest, is forbidden. The way lenders overcome this problem is by buying the property and then selling it to the borrower for a higher price – with the difference equating roughly to the amount of interest that would otherwise have accrued on the deal.

There are estimated to be more than two and a half million Muslims and 100,000 small and medium sized Muslim businesses in the UK. The Islamic Banking Corporation believes the UK Islamic mortgage market could be worth more than £1 billion by 2009 and the FSA says that Islamic finance is growing worldwide by about 10% - 15% per year and is worth approximately £250 billion globally.

Vanessa Blount said: "There is growing demand for Islamic home finance and we want to ensure intermediaries have access to a specialist panel of conveyancers who understand the specific requirements of Islamic law. We intend to develop further specialist services of this nature in future, which cater for the needs of emerging new markets in the UK."

Intermediaries requiring further information about the full range of services on offer from eConveyancer by phoning 01844 262392 or emailing: econveyancer@utdgroup.com

CIMA first chartered accountancy body with Islamic Finance global qualification

CIMA (the Chartered Institute of Management Accountants) is the first chartered accountancy body to offer a global qualification in Islamic Finance, which the CIMA Centre of Excellence is launching on 05 December. Visit www.cimaglobal.com/islamicfinance to find out more.

The Islamic finance industry is thought to be worth between £150bn and £250bn, and is growing at an estimated rate of 15 – 20%. In an exciting new development in meeting the needs of its employer and student stakeholders, CIMA today launches a global qualification in Islamic Finance. We believe that this is a first for a professional accountancy body. To date, few courses are available in this area of finance and normally comprise of short 1 – 3 day events. CIMA's self-study qualification has been developed alongside the International Institute of Islamic Finance, with detailed input from its CEO Dr Mohd Daud Bakar, a renowned Shari'ah Scholar.

Robert Jelly, Director of Education at CIMA, says:
"CIMA has identified that there is considerable demand from the global business community to develop the knowledge and skills required to service this increasingly important market. The CIMA Islamic Finance qualification is the first to be created in conjunction with an Advisory Group made up of academics, practitioners and scholars of Shari'ah, and will assist employers in the City of London and other major financial centres throughout the world in equipping their employees to develop financial products."

CIMA's new qualification is available at Certificate level and comprises four modules: Islamic commercial law; Islamic banking and takaful (insurance); Islamic capital markets and instruments; and accounting for Islamic financial institutions. It is estimated that a student can complete these modules in between 2 – 6 months depending upon prior experience.

The qualification is available across the globe as a series of study guides, revision kits and a microsite and provides students with a thorough knowledge of the theoretical and religious aspects that underpin Islamic finance. On completing the Certificate, students will be comfortable with the array of Arabic terminology used throughout as well as the regulations which govern Islamic finance in practice.

Kashrus Supervision In Demand In Beijing

By: 5TJT Staff

 Published: Thursday, February 21, 2008

 The Chinese capital's only kosher restaurant opened ten months ago, drawing the small Jewish expatriate community, tourists, curious Chinese, and even a few Muslims. Business has been so good at Dini's Kosher Restaurant that part-owner Lewis Sperber is talking about setting up a second branch closer to the Olympic venues in northern Beijing.

Like many restaurateurs and bar owners, Sperber is hoping to benefit when as many as 550,000 foreigners descend on Beijing for the August 8–24 games. "What we've thought about is preparing sandwiches and other items at a venue closer than we are now to the Olympic sites," Sperber said. "If people leave the Olympics and want a kosher meal, we could have a place for them."

Eating kosher is hardly a raging fad. However, there is a real boom in the number of Chinese factories being certified to export kosher products. This is driven partially by recent food safety scares in China involving contaminated seafood, pet food, and toothpaste. Kosher certifications in China conducted by the Orthodox Union, the best-known certification body, have doubled to 307 in the last two years. The total number of kosher certifications is about 2,000 exporters working to reach the world kosher market.

"I think business will be very overwhelming during the Olympics," said Minette Ramia, who manages Dini's, a modern, pastel-colored eatery located on Super Bar Street, an aptly named alleyway lined with restaurants and bars just down the street from the Israeli embassy. "From the hygiene side, whether someone [keeps] kosher or not, Jewish or not, people will want food from here because it is considered cleaner and more hygienic being that we're in China," Ramia said. "A Muslim woman came in recently because she can't eat meat anywhere else."

Britain plans to issue Shariah law-compliant bonds

The Associated Press

LONDON: Britain's Treasury is likely to back plans to issue Shariah law-compliant bonds, officials said Sunday — amid continuing debate about the application of Islamic laws in the U.K.

Treasury chief Alistair Darling, who will present his annual budget on March 12, plans to issue the Islamic bonds, known as sukuk, to tap into a fast-growing market in the products.

"We want the City of London to be one of the gateways globally for Islamic financial products," a Treasury spokesman said, on customary condition of anonymity in line with policy.

"Just because of your faith, there shouldn't be any issue about your access to financial services in the U.K.," he said.

Shariah law prohibits charging or paying interest, which has led to the growth of a market in financial services created to be compliant with Islam.

Sukuk are structured as profit-sharing plans so that the bondholder's income resembles a rent payment. The process is usually blessed by a board of religious scholars affiliated with a bank.

Islamic banking assets totaled US$750 billion in 2006, according to a report issued in October by consultants McKinsey & Co.

Sukuk issuance has grown almost 85 percent per year since 2001, the McKinsey report said.

Darling's move follows worries over comments made by Archbishop of Canterbury Rowan Williams, who has called for a limited application of Islamic Sharia law in Britain.

Williams, the country's highest ranking Christian leader, suggested British Muslims should be able to resolve marital and financial disputes under Islamic law rather than in British courts.

His comments were rejected by Prime Minister Gordon Brown and led to sharp criticism from other clerics and lawmakers.

Opposition Conservative legislator Edward Leigh said he feared issuing Shariah-compliant financial products could also cause problems.

"I am concerned about the signal this would send — it could be the thin end of the wedge. British common law must be supreme and should apply to everyone," Leigh was quoted as telling the Mail on Sunday newspaper.

Muslim thinkers can introduce independent monetary, banking system

Iran-IDB-Ahmadinejad
President Mahmoud Ahmadinejad said here Saturday that Muslim world thinkers are capable of introducing a monetary and banking system independent of the current system dominating the world.

President Ahmadinejad told head of the Islamic Development Bank Ahmad Mohammad Ali that any decision and activities for establishment of a banking and monetary system being based on Islamic injunctions would have an impact on colonial approach of some states towards Muslim states.

Stressing that the monetary and banking system regulates relations among countries and is the basis for economic activities, Ahmadinejad said Muslim states have been facing some restrictions in acting on the monetary and banking system governing the world.

He went on to say that the monetary and financial system underway in the world were devised after World War II as a means for domination on other countries.

He said among restrictions which such financial and monetary systems have created for Muslim states are outflow of Muslim nations' wealth and achievements and usage of the financial and monetary mechanisms against Muslim world.

He said some financial institutions, while offering loans, impose their economic policies on countries.

He then referred to war in Africa and said some countries wage war in Africa to raise their arms sale there and plunder the continent's mineral resources and wealth, prepare the ground for massacre of enormous people.

He said there are yet other groups of states which have monopolized drugs to dominate other nations and test their new drugs on nations.

The president went on to say that cooperation among Muslim states will help speed up growth and development.

Part of Muslim states' wealth can be put at the disposal of the IDB so that it can present them to Muslim countries to be spent on their development.

He said sound management is needed for better exploitation of Muslim world potential.

He added that more than 90 percent of Muslim states' needs can been met by the countries themselves.

He noted that the IDB and the Islamic Solidarity Fund for Development can help enhance areas of their activities.

The Islamic Republic of Iran is ready to put all its scientific achievements and its engineering and technological services at the disposal of other countries, he added.

Elsewhere in his remarks, Ahmadinejad said all countries today need sustainable and peaceful nuclear energy for their industrial, agricultural and health development, so Iran is ready to put its invaluable experience in the field at the disposal of Muslim states under the IAEA supervision.

He also pointed to Iran's extensive progress in different fields and said Iran has gained remarkable achievements in the dam and power plant construction, auto manufacturing, health, medicare and new technologies.

He hailed the IDB as a strong and supportive base for Muslim world economic activities.

He pointed to establishment of the Islamic Solidarity Fund for Development, calling it one of the IDB blessings.

He hoped that through efforts of Muslim officials and their assistance, there will be no poverty and illiteracy in Muslim world, which is not an inaccessible goal.

He then hailed Muslim world for having the best financial resources, tourism attractions and rich underground resources, saying facilities and ground are prepared for a big jump towards reconstruction in the world of Islam.

Passion, fraternity, peace loving and Islamic justice seeking feelings are assets of Muslim world as mankind needs them, he added.

Prior to the president's address, IDB Chief Ahmad Mohammad Ali said there are extensive grounds for Muslim world's using Iran's valuable experience.

He said the Islamic Solidarity Fund for Development has been established to eliminate poverty and illiteracy and eradicate contagious diseases in Muslim states.

He hoped that through constant support of Muslim states, especially Iran, the Fund would achieve its goal of development.

CIMA first chartered accountancy body with Islamic Finance global qualification

CIMA (the Chartered Institute of Management Accountants) is the first chartered accountancy body to offer a global qualification in Islamic Finance, which the CIMA Centre of Excellence is launching on 05 December. Visit www.cimaglobal.com/islamicfinance to find out more.

The Islamic finance industry is thought to be worth between £150bn and £250bn, and is growing at an estimated rate of 15 – 20%. In an exciting new development in meeting the needs of its employer and student stakeholders, CIMA today launches a global qualification in Islamic Finance. We believe that this is a first for a professional accountancy body. To date, few courses are available in this area of finance and normally comprise of short 1 – 3 day events. CIMA's self-study qualification has been developed alongside the International Institute of Islamic Finance, with detailed input from its CEO Dr Mohd Daud Bakar, a renowned Shari'ah Scholar.

Robert Jelly, Director of Education at CIMA, says:
"CIMA has identified that there is considerable demand from the global business community to develop the knowledge and skills required to service this increasingly important market. The CIMA Islamic Finance qualification is the first to be created in conjunction with an Advisory Group made up of academics, practitioners and scholars of Shari'ah, and will assist employers in the City of London and other major financial centres throughout the world in equipping their employees to develop financial products."

CIMA's new qualification is available at Certificate level and comprises four modules: Islamic commercial law; Islamic banking and takaful (insurance); Islamic capital markets and instruments; and accounting for Islamic financial institutions. It is estimated that a student can complete these modules in between 2 – 6 months depending upon prior experience.

The qualification is available across the globe as a series of study guides, revision kits and a microsite and provides students with a thorough knowledge of the theoretical and religious aspects that underpin Islamic finance. On completing the Certificate, students will be comfortable with the array of Arabic terminology used throughout as well as the regulations which govern Islamic finance in practice.

Kashrus Supervision In Demand In Beijing

By: 5TJT Staff
Published: Thursday, February 21, 2008

The Chinese capital's only kosher restaurant opened ten months ago, drawing the small Jewish expatriate community, tourists, curious Chinese, and even a few Muslims. Business has been so good at Dini's Kosher Restaurant that part-owner Lewis Sperber is talking about setting up a second branch closer to the Olympic venues in northern Beijing.

Like many restaurateurs and bar owners, Sperber is hoping to benefit when as many as 550,000 foreigners descend on Beijing for the August 8–24 games. "What we've thought about is preparing sandwiches and other items at a venue closer than we are now to the Olympic sites," Sperber said. "If people leave the Olympics and want a kosher meal, we could have a place for them."

Eating kosher is hardly a raging fad. However, there is a real boom in the number of Chinese factories being certified to export kosher products. This is driven partially by recent food safety scares in China involving contaminated seafood, pet food, and toothpaste. Kosher certifications in China conducted by the Orthodox Union, the best-known certification body, have doubled to 307 in the last two years. The total number of kosher certifications is about 2,000 exporters working to reach the world kosher market.

"I think business will be very overwhelming during the Olympics," said Minette Ramia, who manages Dini's, a modern, pastel-colored eatery located on Super Bar Street, an aptly named alleyway lined with restaurants and bars just down the street from the Israeli embassy. "From the hygiene side, whether someone [keeps] kosher or not, Jewish or not, people will want food from here because it is considered cleaner and more hygienic being that we're in China," Ramia said. "A Muslim woman came in recently because she can't eat meat anywhere else."

The staff and cooks at Dini's are nearly all Chinese. Waiters bring new Chinese customers a handout to explain kosher, which is called jie shi in Chinese—"clean food." "When Chinese come, I don't think they know what to order," said Zhao Haixia, the assistant manager. "Normally they just rely on us to tell them what's good." The menu features both Northern European (Ashkenazi) and Mediterranean (Sephardic) food traditions. Mainstays like matzo ball soup, chopped liver, and gefilte fish are seldom chosen by Chinese, who more often go for kosher beef dumplings (jiaozi) or sizzling beef, kosher style. Gefilte fish is a hard sell. "In China eating cold fish doesn't sound so good," Zhao said.

Like Beijing's noxious air, China's food safety is one the most sensitive issues surrounding the Olympics, carrying the potential to ruin China's $40 billion preparations to use the games to show off a modern nation removed from its agrarian roots. One food-poisoning case, like one positive doping test—particularly by a Chinese athlete—could grab headlines for weeks and ruin the public-relations effort by the Communist government. Following a string of food scandals last year, Beijing organizers launched an aggressive campaign to showcase a new way of monitoring, aimed at tracing products from the field to the table.

The government also unveiled the Olympic Food Safety Command Center to deal with food emergencies. "Precautions must be taken to avert any trace of terrorist attack on our food supply chain," said Zhang Zhikuan, head of the Beijing Industry and Commerce Bureau.

Concern centers on the safety standards of meat and stimulants used to boost yields. Some fear drugs used in animal feed could trigger positive doping test among athletes. At least one of the new monitoring systems—coding on packaging to trace the source of production—has long been required for kosher certification. "The fact that there is another set of eyes coming through the plants on a regular basis—such as the kosher auditing or kosher supervisors—means that the companies, the factories are more careful about hygiene and sanitation," said Rabbi Mordechai Grunberg, who examines Chinese factories for the Orthodox Union.

China's kosher exports are composed almost exclusively of food additives, spices, vegetables, and candies. "It's like any other product coming out of China," Rabbi Grunberg said. "Outsourcing has gotten easier, quality has gotten higher, and the price is cheaper."

Rabbi Shimon Freundlich, who also inspects for the Orthodox Union and owns a part interest in Dini's, said American-based food companies are asking him to conduct non-kosher inspections of their operations in China. He called them "100 percent" related to recent food scandals in China. "They don't necessarily want it for kosher purposes," he said. "They just want to make sure they can guarantee that the standard promised by the company is what's being produced."

The Jewish population in mainland China is only a few thousand and exclusively expatriates—1,500 in Beijing, 1,000 in Shanghai, and 500 in Guangzhou. Several thousand more are scattered in small cities, with 4,000 in Hong Kong. Historians suggest a small Chinese Jewish community existed centuries ago in the central city of Kaifeng.

Grunberg is optimistic that a domestic kosher market will develop in China, fueled partly by hygiene issues. "I think there will be a big market here, and a big market could mean just a fraction of a percent of 1.3 billion. With only that you'll have a bigger market than we have for kosher in the United States."

Both kosher and halal (food prepared following Islamic religious rules) will be available at the Olympic Athletes Village, a requirement of the International Olympic Committee. The Philadelphia-based company Aramark is running the catering operation and will serve 17,000 athletes and officials at dining rooms capable of feeding 6,000 at once on a 24-hour schedule.

The Olympic kosher kitchen is being lined up by Rabbi Freundlich, the rabbi of Beijing's Jewish community. "I would be the overall supervisor of the kitchen and have a number of colleagues helping me maintain the kosher standard throughout the Olympics," he said. "We'd expect to serve 300 to 400 meals a day, more than twice what I'm told was served in Athens."

Sourcing of most halal and kosher products in China is easy, except for meat. No factory has been certified to export kosher meats from China. Many factories are certified to produce halal, though exporting halal meat from China is difficult, with some Islamic countries suspicious of Chinese certification. China is estimated to have a Muslim population of 1 to 2 percent of its 1.3 billion people, most living in the west of China.

"Normally it's easy to export halal non-meat products from China, but meat products certified in China are more difficult," said Ray Chueng, a Shanghai businessman who helps factories get halal or kosher certification. "I think even Chinese Muslims are not so careful with halal things," Chueng added. "They know what you can eat and can't eat, but they are not very careful if things are labeled halal."

Penny Xiang, deputy director of the Game Services Department for the 2008 Olympics, said 36 food suppliers have been picked for the games, "all under very close supervision." She declined to offer extra details. In general, Beijing organizers are careful talking about food suppliers, citing security reasons.

"I think the government's food security committee has formulated a special standard for the Olympic Games compared with the national standard and the World Health Organization standard," she said. Asked how the new standard compared, she replied: "It's probably higher." She said daily food consumption at the Athletes Village would reach 220,000 pounds, with daily rubbish weighing 110,000 pounds.

"Sometimes it's the easiest and simplest things that makes the most complex job," Xiang said. "People think preparing food is so natural, so easy. It comes to you every day and you are so used to it, so you don't think there is any complexity behind it. Eating is easy, but serving the right food to people is hard."

Xiang said many of China's "most influential politicians, going right to the top," wanted the Olympics to showcase only Chinese cuisine in the Athletes Village. Several proposed preparing 2,000 Peking roast ducks—the capital's specialty—for athletes before the August 8 opening ceremony.

Presumably some would have been kosher ducks. "It was ruled out," Xiang said. "We'd need to serve all of this just before the biggest moment for commotion and confusion. Just imagine how that would have been." (JPost.com/AP)

Limitless to develop fully integrated world halal centre

20-02-2008

KUALA LUMPUR: Dubai World unit Limitless LLC, in a joint venture with Mihap Holdings Sdn Bhd and Selangor Agricultural Development Corporation (SADC), is developing a fully integrated world halal centre in Selangor to turn Malaysia into a global gateway for the industry.

The Malaysia International Halal Park (MIHAP), a 80-20 joint venture between Limitless and a Malaysian investment company comprising Mihap Holdings and SADC, will include more than 800ha of residential units, food manufacturing plants and logistics ports.

The facility, which has the distinction of being the world's first fully integrated halal centre, will also accommodate training and research centres, as well as offices, entertainment and retail facilities. Work on MIHAP will start towards end 2008, with phased completion over eight years.

In a statement yesterday, Limitless chief executive officer Saeed Ahmad Saeed said: "Limitless is truly making its mark in South East Asia. MIHAP is a major milestone for Limitless and another golden opportunity for us to demonstrate our core skills of master planning and executing distinctive, large-scale projects."

In December 2007, Limitless announced it would undertake the masterplan for a waterfront development of luxury homes at Puteri Harbour in Malaysia's Iskandar Development Region.

S&P unveils Shariah-compliant equity indices in India

Tue Feb 19, 2008

MUMBAI (Reuters) - Rating agency Standard & Poor's (S&P) said on Tuesday it has launched two Shariah-complaint equity indices in the country in partnership with India Index Services & Products Ltd.

The indices have been derived from the top fifty and top 500 stocks traded on the National Stock Index and covers 80 percent of the traded volume on the exchange, it said in a statement.

The S&P CNX Nifty Shariah index comprised the top 40 scrips while the S&P CNX 500 Shariah index comprised 263 scrips, the statement said.

Shariah forbids Muslims receiving interest payments and from investing in companies involved in the production of pork, alcohol, tobacco, pornography, gambling and non-Islamically structured finance for life insurance.

Sukuks to enjoy double-digit growth until 2010

February 19 , 2008

Growth in new sukuk, or Islamic bond, issues is expected to remain in double-digits in the next two years despite current constrained liquidity, according to a latest research report.

US-based firm Morgan Stanley said in its industry report on Islamic banks that it expects sukuk, one of the fastest growing financial instruments globally, to be the largest contributor to sustained double-digit growth in Islamic finance.

Although it does not expect the cost of debt to retract significantly from the current levels this year, the global financial services firm said GCC firms cannot afford to postpone their expansion plans for much longer.

The firm expects Gulf banks – particularly the Islamic banks – to emerge as sukuk issuers since growth in customer deposits has been lagging growth in assets.

"Competition for deposits has also intensified in a negative real interest rate environment," the report said.

Morgan Stanley also forecast a "high 'teens CAGR [Compound Annual Growth Rate] in assets in the next few years", which it said should push banks to raise more sizeable medium to long-term funding.

Outstanding issued sukuk are at more than $90 billion (Dh330bn) today – almost 40 per cent of which are international issues – up from less than $1bn in 2002, the report said.

Sukuk worth $40bn were issued in 2007.

The report said that the figures would have crossed $50bn had international liquidity crunch not taken its toll on the industry in the second half of last year.

"A dozen or so deals were postponed to the first half of 2008 as issuers did not accept the wider spreads in the second half of 2007."

Although sukuk has been dominated by Malaysia and the UAE, which issued 55 per cent and 20 per cent of sukuk to date, the trend is increasingly going global to non-Muslim countries.

China, Japan and Thailand plan to issue sovereign sukuk this year, and the United Kingdom's Treasury said on Sunday it will probably support plans to issue sterling Shariah law-compliant bonds, amid continuing debate about the application of Islamic laws in the UK.

According to the Morgan Stanley report, international banks dominate the top rankings of sukuk lead managers, while Gulf banks are more subscribers to sukuk than issuers.

This is because complex sukuk structures involve challenging regulatory and legal procedures, and require extensive and costly advisory services.

"The distribution and transaction costs involved in pioneering such instruments are very high relative to conventional issues," the bank said in the report.

However, it added that Dubai Islamic Bank is ranked in the top 10 lead managers on cumulative sukuk issues since 2002 due to Dubai-based property developer Nakheel's $3.52bn convertible Ijara sukuk – the largest to date – issued in late 2006.

Sharia mortgage market continues to grow

Feb 19 2008

The presence of Sharia-compliant mortgages in UK finance is becoming stronger, according to Waqar Ahmed, sales and marketing officer at Islamic finance provider Alburaq.

According to Ahmed, the 2 million strong presence of Muslims in the UK signals positive growth potential for Islamic retail banking, as well as facilitating the Muslim community with financial services that do not compromise their religious beliefs.

"The UK market continues to evolve and Alburaq has approved over £100 million worth of mortgage business in the last 12 months and is set to see the total market grow to over £1 billion by 2009," he said.

Sharia-compliant mortgages combat the problem of paying interest – the main financial issue conflicting with the Islamic faith – by allowing Muslims to rent back properties bought by mortgage lenders. Typically, a lender will pay for up to 90% of the cost over a period of 25 years. The borrower then rents the property and pays purchase installments over the 25-year period, leaving them as the owner by the end of the term. Economically, the numbers involved are not dissimilar to an interest-only mortgage but the legal structure and contracts are completely different, ensuring that no interest is payable.

SEBI okay may see Islamic funds enter Indian realty

27 Feb, 2008, 0358 hrs IST, TNN

MUMBAI: Booming Islamic finance is likely to acquire assets in India through Islamic Real Estate Investment Trusts. According to a report by Moody's although IREITs are not in existence in India, the draft IREIT guidelines issued by SEBI may pave the way for these funds into the Indian property market.

With high oil prices funnelling billions of dollars to the Middle East, there is an increased demands for Sharia-compliant finance products. According to Moody's, Islamic finance is now estimated to be worth around $700 billion globally while Sukuk, or Islamic bonds, are the fastest-growing segment, with volumes worldwide reaching $97.3 billion till 2007.

Moody's pointed out that the property boom in the Middle East makes IREITs a much-needed product and a useful investment tool, given the existing favourable investment and regulation environment. Moreover, there has been a growing appetite for the real estate asset class among regional institutional investors as the region boasts of world's highest concentration of high net worth individuals and family businesses, which in the GCC alone is estimated at over $1.3 trillion.

In terms of the money raised through Sharia-compliant instruments, Sukuk bonds continue to remain at the centre stage, with more than $19 billion in Sukuk issuances in '07 in the GCC region. The UAE and Saudi Arabia have accounted for more than 87% of the total.

The just-released report on Islamic Finance is authored by Dominique Gribot-Carroz, a Moody's assistant vice-president in Hong Kong, and Faisal Hijazi, an Analyst in London. "From a global point of view, we anticipate that overall Sukuk issuance should continue to increase in '08 by approximately 30-35% per annum," said Gribot-Carroz, adding that new funds would be raised mostly in Gulf Cooperation Council countries, North Africa and Asia-Pacific.

More specifically, Moody's new report pointed out that Asian currency-denominated Sukuk outstanding grew by close to 50% to $65.3 billion in '07 from $43.6 billion in '06, adding that growth has become even more sustained since the summer of 2007.

Malaysia continues to lead the way in terms of offering an attractive environment for Islamic finance and remains the biggest domestic market worldwide. Ringgit-denominated Sukuk issued in '07 amounted to the equivalent of $64.4 billion, or 66% of the global outstanding as on December 31, 2007. The prospects for Islamic finance in Asia-Pacific are generally good, the report said. For example, the Japanese government is planning its first sovereign Islamic Sukuk in 2008, valued at between $300 million and $500 million.

Moreover, in the rest of Asia, economies such as Singapore are contemplating issuing their first Sukuk in 2008, while in Hong Kong the authorities are fully supportive of the development of Islamic finance. At the same time, Moody's expects the small, but growing Sukuk markets in Pakistan and Indonesia to grow significantly over the coming years.

Even though the total assets of Islamic banks in Indonesia may still only represent a minor portion of the country's total banking assets, Moody's believes they are expected to grow significantly, and that this could also encourage Sukuk issuance.