Taurus Mutual Fund launches Shariah Compliant Taurus Ethical Fund

Taurus Mutual Fund has launched a new open-ended equity oriented scheme Taurus Ethical Fund. Taurus Ethical Fund will actively manage investment in companies which are in compliance with the Shariah norms. The scheme will primarily invest in Equity and Equity related instruments.

The New Fund Offer opens on 19th February 2009 and closes on 20th March 2009.

The scheme re-opens for redemption and continues offer at a date not later than 30 days from the date of close of New Fund Offer. The New Fund Offer is priced at Rs 10 per unit + applicable load.

The Minimum Application Amount during NFO is Rs 5000 and in multiple of Rs 1 there of.

The entry load is 2.25% and exit load is 1% upto 6 months. The exit load will be 0.50% from 6 months to 1 year and no exit load after 1 year. Under SIP, there is no entry load. But, there is an exit load of 2.25% if redeemed within 1 year from the date of allotment - applicable to each allotment.

The scheme offers different choices of investment like Growth, Dividend Option - Dividend Payout & Dividend Re-investment option, Bonus option.

The Benchmark for the scheme will be S&P CNX 500 Shariah Index.

Islamic finance body rules on capital, investments

An Islamic finance industry body announced on Friday regulations relating to collective investment schemes and the capital of sharia institutions to improve investor protection.

The Kuala Lumpur-based Islamic Financial Services Board (IFSB), an umbrella group for Islamic financial regulators, said it had adopted guidelines to promote transparency for investors of collective investment schemes.

It also released rules on capital requirements for Islamic institutions involved in Islamic bond issuance and real estate investments.

IFSB's regulations are not binding on the sector and compliance is voluntary, as is the case with those issued by other Islamic finance industry bodies.

As at January 2009, IFSB had 178 members including the International Monetary Fund, World Bank, Bank for International Settlements and Islamic Development Bank.

UK institute CIMA offers course in Islamic finance

UK-based Chartered Institute of Management Accountants (CIMA) would be offering self-study course in Islamic finance, thus becoming the first internationally recognised professional body to offer such a qualification.

“CIMA Certificate in Islamic finance is aimed at producing competent staff, who would be conversant in all areas of Islamic finance at both theoretical and practical levels. The course is targeted at diverse range of participants, including employers and employees currently operating in the sector and those wishing to move into it,” said Arati Porwal, chief India representative of CIMA.

The course comprises four modules: Islamic commercial law, Islamic banking and takaful (insurance), Islamic capital markets and instruments, and accounting and analysis of Islamic financial institutions.

Meanwhile, a diploma-level qualification —international Islamic finance: governance and analysis — would be available at a later date. This will be a written exam based on case studies. The complete package (including two attempts at each assessment) costs £1,500. Further re-sits of the exams after the two attempts would cost an additional £60.

“We estimate that it would take students between two and six months to reach a stage where they can sit for all the final exams, depending on prior knowledge and experience. All assessments will be delivered online,” Porwal added.

On the prospects of Islamic financing, Porwal noted the Islamic financing industry is now estimated to be worth between £150- 250 billion, compared with £100 billion two years ago, and its current annual growth rate is estimated at between 15-20 per cent.

“Interest in the area is anticipated to grow with an ever increasing proportion of Muslims and non-Muslims worldwide seeking out Islamic financial products. While demand for the products has increased dramatically, the supply of suitably qualified staff has not kept pace and this course is aimed at bridging the gap,” she added.

Islamic banking rising but impact is minimal

Although Islamic banking business in Malaysia is expected to remain on the uptrend, its contribution will have minimal impact on the total income of local banks, analysts said.

TA Securities noted that while prospects were still good for Islamic banking in the country, it contributed only 10% to 11% on average to the total income of the country’s nine listed banks in the third quarter ended Sept 30, and 9% in the second quarter.

However, for the third quarter of 2008, Islamic banking income for these banks grew 3.7% versus the second quarter despite a 15.7% drop in the banks’ total income.

“We expect the Islamic banking business to contribute an average of 10% to banks’ total income for the current earnings reporting season (the three months ended Dec 31 to be released latest by end February),” said Wong Li Hsia, a banking analyst with TA Securities. “Going forward, we expect the Islamic banking business to slow down a little in line with the rest of the banking industry.”

AMMB Holdings Bhd, which recently announced its third quarter results, recorded a net income of RM143.8mil from Islamic banking or a 16.2% contribution to its total income.

24 Malaysian Islamic banks at MSE 2009

Institutions and investors looking at viable and stable alternatives to conventional financial systems and tools will have an opportunity to gain valuable insights into Islamic finance at the Malaysia Services Exhibition (MSE 2009) held at the Dubai Airport Expo from March 17 to 19.

MSE 2009 is organised by Malaysia External Trade Development Corporation (Matrade), the national trade promotion organisation of Malaysia, which has 39 offices around the world including in Dubai and Jeddah.

The exhibition will showcase over 200 service providers from 13 industry clusters where its broad range of services can meet the growing needs of the markets in the Middle East, North Africa and Commonwealth of Independent States (CIS).

The Financial Services cluster of the event will feature 15 leading institutions that pioneered Islamic finance in Malaysia and lead the country's evolution into the premier platform for Islamic finance activities. Together, these institutions will showcase a diverse range of Islamic products and support systems required to make Islamic finance a sustainable economic model. To date, there are over 11 Islamic banks and 13 other banks participating in Islamic banking schemes in Malaysia with total of 1,281 branches operating throughout the country.

Malaysia holds the distinction of being the world's first country to have a full-fledged Islamic financial system operating in parallel to the conventional banking system. The country also places a strong emphasis on developing the human capital required to promote growth of Islamic finance locally and globally.

Islamic Economics, Banking and Finance: Historical Perspective and Future Prospects

Islamic banking and finance had its major beginnings in the year 1975 with the establishment of the Islamic Development Bank. Islamic banking has flourished in various countries since then with Malaysia, Indonesia, UAE, Pakistan and Saudi Arabia being in the forefront. Islamic banking has also recently done rather well in non-Muslim countries with the reported size of UK Islamic banking overtaking that of majority Muslim countries like Pakistan. Islamic banking assets are thought to be anywhere from 700 billion dollars to 900 billion dollars as of 2009. The credit crunch that has affected much of the western world has not taken its toll on the Islamic Banks, mainly because of the nature of the underlying transactions which admonish Riba and encourage instead a partnership based approach. The result is that the actual profit or loss is shared with the shareholders rather than an arbitrary number called Riba or "interest" which they have to come up with to please the investors regardless of the market situation. In this way, Islamic Banking also helps in depicting the true state of the economy.

Islamic indices historically have also been outperforming the other indices with the Dow Jones Islamic Developed World Index outperforming the MSCI World Index consistently over the past few years. Growth in Islamic banking has also been stellar and it has been growing at a healthy rate of 15-20% per year according to estimates. Moody´s has projected that Islamic banking would expand to a total value of $4 trillion dollars in another five years. The reason to this growth can also be attributed to the western banks taking interest in the Islamic banking instruments. Lloyd´s bank in the UK spread Islamic instruments to all of its two thousand branches in 2006 from five branches a year earlier. HSBC, Standard Chartered and Citigroup are some of the conventional western banks which have invested in Islamic banking.

New plans all around, will they work?

Ahem… wow been really working my --- off for the past few days. Well anyways a lot of things have happened between that time. 

For instance Pakistan planned to open 230 new Islamic finance outlets. There has been a growth in demand for Shariah compliant loans and the already existing 500 branches. Smaller enterprises are thriving and trying to expand in this depressed economy and farmers it seems are not effected by what's going on around them. So the demand is probably going to come from those sectors. 

While in Pakistan the Islamic banking branch of the Bank of Khyber (BOK) was formally inaugurated in Rawalpindi. BOK Managing Director Bilal Mustafa speaking on the occasion said BOK was stable despite economic crisis, which shows the confidence of depositors on the bank (I did not know that, now that makes one wonder). 

At the same time two KSA companies have planned to establish a new Sharia compliant real estate finance company. The partnership is between Al-Khabeer Merchant Finance Corporation and Al Mutajra. Dari Home Loans as it will be called will become one of the first real estate financing companies in the Kingdom to specifically cater to the middle income sector. Saudi's real estate finance segment is still in the early stages of development and has been collaborating with the public and private sectors in the development of rules and regulations governing this industry. Did you know 70 per cent of Saudis under the age of 30 do not have a home? (I thought everybody there lives in Palaces).

In Nigeria a bank called The Kwara Commercial Micro Finance Bank is to offer interested customers Shari'ah compliant services. According the mission statement of the bank "KCMB works with its customers in a view of profit sharing (mudharabah), safekeeping (wudiah), leasing (ijarah), joint venture (musharakah) and capital venture (mudaraba)." Features of these financial services include "include no interest and guaranteed return." (Now that's really interesting).

All was not hunky dory and Turkey's launch of bonds designed to appeal to Islamic investors fell flat, raising only a quarter of the $1.16bn the Treasury had hoped for.

Paradigm to distribute Sharia-compliant products

Paradigm Mortgage Services has teamed up with the Islamic Bank of Britain (IBB) to be the distributor for its Sharia-compliant products.

Paradigm members will now have access to IBB's complete range of products, which are suitable for both Muslim and non-Muslim customers and cover both personal and business customers. 

Personal products include current and savings accounts, personal finance and IBB's Sharia-compliant mortgage alternative, the Home Purchase Plan. Business products also include current and savings accounts, plus business and commercial property finance options.

Bob Hunt, chief executive of Paradigm, said: "We are delighted to announce this formal link-up between Paradigm and IBB which will provide our members with access to the products IBB currently offers."

Ex DLA Islamic finance head launches new firm

DLA Piper’s former global head of Islamic finance Oliver Agha has set up a firm in the United Arab Emirates, establishing a non-exclusive relationship with Pillsbury.

Agha has formed the Agha & Shamsi law firm in Abu Dhabi with Emirati lawyer Dr Al-Shamsi. The practice will initially employ six lawyers focusing on Islamic finance, energy, restructuring and project finance and marks the first Gulf affiliation for US firm Pillsbury.

Agha said: “The idea is to create a high quality firm and provide Islamic finance, UAE and Saudi law advice [through an alliance with a Saudi firm]. I was in talks with quite a few firms and the cultural fit with Pillsbury was best.”

Pillsbury’s trade finance partner and head of the worldwide finance practice Michael Schumaecker said: “Part of what we’ve been doing for a year is speaking to a number of firms. We wanted something very small and focused in the Middle East and began to speak to Oliver Agha in the summer. Oliver must have met over 50 Pillsbury partners. He needed to feel comfortable with our culture and our intellectual approach to Islamic finance. We don’t see it as just another way of structuring a deal. Islamic finance is not a technique, it’s a philosophy.”

Biggest Islamic bank in Bahrain next June

Manama, Bahrain: The biggest Islamic bank in the world will establish in Bahrain by the Islamic bank for development and other investors next June with a prepaid capital of 11 billion dollars in order to enhance development in the Islamic nations, said the general council of Islamic financial firms. 

Head of union of Arab banks and chief executive of Al Baraka banking group Adnan Yousif told Bahraini daily '' Al Watan'' that the bank aimed at financing development projects that serve the society. Yousif expected that Bahrain's share in the bank would be 10 or 15 percent and other shares of Arab and Islamic countries would be decided at the foundation meeting of the bank.

HSBC launches Amanah India Shariah Portfolio

MUMBAI: The portfolio management services division of HSBC Asset Management has launched HSBC Amanah India Shariah Portfolio and is now open for subscription.

The scheme is an actively managed, open-ended equity offering wherein investors can contribute their funds for investment in conformity with Islamic Shariah principles. This is one of the first Shariah compliant offerings in the Indian market and will provide investors with an opportunity to benefit from returns through Shariah-compliant equity investment in Indian companies. 

HSBC Amanah, the global Islamic financial services division of the HSBC Group, is the advisor to the HSBC Amanah India Shariah Portfolio. The portfolio will be benchmarked against the Dow Jones Islamic Market India Index and the BSE 500. 

"We are pleased to be one of the first players to bring a Shariah-compliant product offering to the Indian market. With our local investment knowledge and the global expertise of HSBC Amanah in managing Islamic funds, we aim to make investing a rewarding experience for our investors," said HSBC Asset Management CEO Vikramaaditya. 

Sharia'a-compliant private bank launched in the UK

Bank of London and The Middle East is launching a fully Sharia'a compliant private bank, as the latest bank to move into this sector.

BLME Private Banking will provide Islamic finance solutions to high net worth individuals and entrepreneurs in the UK, Europe and Middle East

Adrian Gayler will head the business; he joins from Merrill Lynch International Bank. He will report to Humphrey Percy, chief executive officer at BLME.

The new private banking offices will be based in Mayfair along with the already established wealth management team.

Humphrey Percy said: "Despite difficult financial market conditions we see this as an opportune time to launch a private banking business. High net worth individuals are increasingly concerned about preserving their wealth and will be looking for counsel and best-of-breed services and solutions, which BLME will offer to clients."

College launches Islamic finance degree

STRASBOURG - A French business school launched a degree in Islamic finance yesterday, as more European Muslims seek careers in a fast-growing sector run under the precepts of Sharia law.

Strasbourg University's School of Management has now recruited 36 students from France, Algeria, Germany, Luxembourg, Switzerland and Tunisia to France's first 11-month postgraduate masters-level course in the subject

Australia-MLA Halal accredited brand.

HALAL BRAND.

The global expansion of the MLA's Halal Brand, is an important step towards expanding markets for Australian red meat, according to Ian Ross the Middle East regional manager for the MLA.

Ross said "with 28% of the worlds population being Moslem and with most of these people living in countries with growing economies, its vital the Australian red meat industry positions itself in the best possible way to supply these important markets".The world has over 2 billion Moslems and the market for Halal products, exceeds US$500 billion.

The major problems in getting Moslem nations to take meat, as opposed to live animals are two fold, one they prefer fresh meat and secondly mistrust of the Halal slaughter procedures, in countries such as Australia and the South American countries.The Australian MLA brand for certified Halal meat, goes a long way towards removing half of the problem.

In Argentina, the Council of Mosques organizes all the Halal slaughter, through a private company, that provides the service at the meat plants www.halalcatering.com.ar .

Palermo Buenos Aires, boasts the largest Mosque in the whole of the America's north and south.

Europlace wants to promote Islamic banks in Paris

DOHA: Paris Europlace (the Paris Financial Centre) said it welcomes sukuk issuers on NYSE Euronext and the setting up of Islamic banks in Paris.

"The regulations that have been recently adopted to facilitate Islamic finance in France are intended to make Paris a hub for Islamic finance and now we have all the tools to accommodate Islamic finance," Arnaud de Bresson, Managing Director of Paris Europlace told a news conference here yesterday. He said Paris Europlace has exerted great efforts for the last three years to promote Islamic finance and the opportunities it has to offer and ultimately submitted proposals for reforms to develop Islamic Finance in France.

As a result, both the French Ministry of Economy, Industry and Employment and the Autorite des Marches Financiers (AMF), the French financial markets regulatory authority, announced late last year significant tax and regulatory changes aimed at boosting Islamic finance in France.

Arnaud de Bresson together with Christian Noye, Governor of Banque de France accompanied by a large delegation is currently visiting Doha as part of a Gulf tour which also includes Bahrain and the UAE.

KL seeks global standards on Islamic banking

DOHA (Qatar): Malaysia has proposed a meeting be held to set up global standards for Islamic banking and finance, Prime Minister Datuk Seri Abdullah Ahmad Badawi said.

Abdullah said he had discussed this with Qatar Prime Minister Sheikh Hamad Jassem Jabor Al-Thani during meetings yesterday and had proposed for the first meeting to be held in Kuala Lumpur.

"We had asked that more attention be given to Islamic banking, considering its acceptance in the world now. The first meeting would be held among experts from countries that have Islamic banking sectors."

Abdullah said that with a global standard, problems that arose could be solved with a common approach and that it would also eliminate confusion.

Moody's is voted Best Rating Agency for Islamic Finance

Moody's Investors Service has been voted 'BestIslamic Rating Agency' that is, best rating agency for Islamic finance ratings by the readers of Islamic Finance News in the publication's annual 2008 Awards poll.

The award recognises Moody's superior ratings coverage of Islamic financial institutions and Sukuk transactions during 2008. 

Indeed, Moody's rates and publishes in-depth research on most of the banks that were voted 'Best Islamic Bank' in their respective country by 

the readers of Islamic Finance News. 

'Moody's is pleased to receive recognition for its credit analyses of Shari'ah-compliant banks and its close surveillance of Islamic capital markets,' said Anouar Hassoune, Vice President, Senior Credit Officer who has spearheaded Moody's 

research on Islamic Financial Institutions. 'Moody's maintains its view that the Islamic finance industry has a bright future,' added Mr Hassoune. 

Moreover, in terms of Islamic securitisations, Moody's rated high-profile deals in 2008, such as the Tamweel Sukuk, which was voted 'Sukuk of the 

year', as well as the Sorouh/Sun Finance deal, which was voted 'Structured Finance Deal of the Year' by the readers of Islamic Finance News. 'The Sorouh/Sun Finance securitisation was a landmark in Sukuk markets, which are increasingly interested in 'true' asset-backed financings. 

Growth seen for shariah-compliant hotels

Hotel accomodations that comply with Islamic dietary and other religious laws are expected to grow in Muslim regions and elsewhere despite economic woes.

Shariah compliant hotels, one of the fastest growing hospitality segments is expected to boost the region's revenue source over the coming years and during global economic turbulence. 

"Muslims, particularly GCC travellers represent a vital market segment. Not only are they one of the most lucrative, with over $12 billion spent on leisure travel alone, but they are also consciously-driven," commented CEO, MKG Hospitality, Vanguelis Panayotis. 

An increase in intra-regional travel and their growing purchasing power has created a significant demand for a product that reflects the lifestyle, culture, history and expectations of the region. This segment will prove to be crucial to the regions' tourism industry over the coming years. 

"Shariah hotels however are not just a niche market for Middle Easterners. They can and should cater for other segments, such as Muslims living in Europe, the US, North Africa and Asia, as well as non-Islamic markets. 

Dubai sees the launch of a dedicated Islamic finance media house

Dubai sees the launch of a dedicated Islamic finance media house

Multi-award winning Shariah consultancy Yasaar Limited has today announced the launch of a dedicated Islamic finance media entity called Yasaar Media.

The founders of Yasaar Media recognise that there is a serious need for an information provider in the Islamic finance space that produces in-depth reports and studies on specific market niches, asset classes and countries. These reports are designed to be market-defining works that will become the benchmark in their field.

The people behind Yasaar Media are Paul McNamara and Majid Dawood.

Mr. McNamara is one of the best known Islamic finance journalists in the world and was co-founder of CPI Financial, a Dubai-based media company. He has launched Islamic finance publications in the UK, the UAE, and Australia. Mr. Dawood has been a key individual in the establishment of Yasaar Limited, the first Shari'ah compliance services company, based in the Dubai International Financial Centre.

Singapore launches first Islamic bond program

SINGAPORE -- The Monetary Authority of Singapore (MAS) announced on Monday its first Islamic bond program worth 200 million dollars (about 134 million U.S. dollars).

The bond program, also named sukuk, is the Sharia-compliant equivalent of Singapore Government Securities (SGS), and will help Islamic banks and other investors in Singapore manage their liquidity and investment portfolio. The sukuk will be issued on a reverse-enquiry basis, based on the demand of financial institutions operating in Singapore.

"This sukuk issuance facility underscores our strong commitment to the development of Islamic finance in Singapore. We invite eligible financial institutions to approach MAS to register their interest," said Heng Swee Keat, Managing Director of the MAS.

The MAS said it will continue to work closely with the industry to ensure that the regulatory and tax framework, and other necessary infrastructure and conditions are in place to foster good risk management and the further growth of Islamic finance in Singapore.

AMU to start 'Islamic Banking' course

LUCKNOW: In what is being touted as a first of its kind in the country, Aligarh Muslim University (AMU) will launch a one-year post graduate diploma course in 'Islamic Banking and Finance' based on tenets of Shariah. 

"The basic principle of Islamic banking based on Shariah, Islamic rules of transaction, is prohibition of Riba (interest)and is known as interest free banking system. As per the tenets of Islam earning interest on money deposit and loans in the bank is prohibited by law," Dr Mohammad Nejatullah Siddiqi, who designed the one-year diploma course, told reporters. 

The university academic council, highest body of the university, which decides on academic affairs, has approved of the introduction of the course early this month from the next academic session, he said, adding, that there would initially be 20 seats in the course. 

In this system of banking the depositor, who does not bear risk as in other banking systems, has to equally share the risk with the bank. Owner of the capital, however, is allowed to have a share in the bank's profits, Siddiqui, a retired AMU professor of Economics and Islamic Studies, said, adding that a similar system is followed by the banks while offering loans to the customers. 

Muslim scholars discuss Islamic banking

Leading Muslim scholars held a seminar on Friday to discuss emerging issues in Islamic Banking in view of new developments in the sector.

The conference held at the Nomad Hotel in Garissa, was organised by Barclays Bank of Kenya Ltd. under its Islamic Banking Division, La Riba.

Led by the Chief Kadhi, Sheikh Hammad Kassim, the scholars deliberated on Islamic banking issues. Sheikh Kassim, who sits on the Barclays Shariah Advisory Board, said the bank strives to be 100 percent Shariah-compliant in its Islamic banking products.

"In the annual reviews conducted by the board, I would like to confirm that the Barclays Islamic Banking Division is in line with the requirements of the Muslim faith,'' noted the Chief Kadhi.

Barclays Head of Islamic Banking, Omar Sheikh, gave an overview on one of the fastest-growing financial product in the market, noting that Barclays set the pace in Kenya when it pioneered the country's first Shariah-compliant financial product in 2006.

Barclays Bank Regional Managing Director, Adan Mohamed, said the bank launched La Riba in response to the needs of the bank's growing Muslim customer base.