Showing posts with label sukuk. Show all posts
Showing posts with label sukuk. Show all posts
Monday, January 20, 2014
UK Courts Islamic Cash with Sharia-compliant Bonds
Sunday, November 03, 2013
Venture Capital: Muslim Money & Extending Bitcoin Influence
Thursday, October 31, 2013
Britain: "A World Capital for Islamic Finance"
But critics say that British ambitions to attract investments from Muslim countries, companies and individuals are spurring the gradual establishment of a parallel financial system based on Islamic Sharia law. The Treasury also said some sukuk Islamic bond issues may require the government to restrict its dealings with Israeli-owned companies in order to attract Muslim money.
The London Stock Exchange will be launching a new Islamic bond index in an effort to establish the City of London as one of the world's leading centers of Islamic finance.
Britain also plans to become the first non-Muslim country to issue sovereign Islamic bonds, known as sukuk, beginning as early as 2014.
The plans are all part of the British government's strategy to acquire as big a slice as possible of the fast-growing global market of Islamic finance, which operates according to Islamic Sharia law and is growing 50% faster than the conventional banking sector.
Although it is still a fraction of the global investment market -- Sharia-compliant assets are estimated to make up only around 1% of the world's financial assets -- Islamic finance is expected to be worth £1.3 trillion (€1.5 trillion; $2 trillion) by 2014, a 150% increase from its value in 2006, according to the World Islamic Banking Competitiveness Report 2012-2013, published in May 2013 by the consultancy Ernst & Young.
But critics say that Britain's ambitions to attract investments from Muslim countries, companies and individuals are spurring the gradual establishment of a parallel global financial system based on Islamic Sharia law.
British Prime Minister David Cameron announced the plans during a keynote speech at the ninth World Islamic Economic Forum, which was held in London from October 29-31, the first time the event has ever been held outside the Muslim world.
"Already London is the biggest center for Islamic finance outside the Islamic world," Cameron told the audience of more than 1,800 international political and business leaders from over 115 countries.
"And today our ambition is to go further still. Because I don't just want London to be a great capital of Islamic finance in the Western world, I want London to stand alongside Dubai and Kuala Lumpur as one of the great capitals of Islamic finance anywhere in the world." » | Soeren Kern * | Thursday, October 31, 2013
* Soeren Kern is a Senior Fellow at the New York-based Gatestone Institute. He is also Senior Fellow for European Politics at the Madrid-based Grupo de Estudios Estratégicos / Strategic Studies Group. Follow him on Facebook.
Cameron Unveils Islamic Bond
He told the World Islamic Economic Forum (WIEF) in London, "Britain is a country ready to welcome your investment, a country that values your friendship, and will never exclude anyone because of their race, their religion, their colour or their creed."
Under Islamic rules, no interest can be charged; transactions must be based on a real trade; and they must not involve gambling or alcohol.
London wird zum Mekka
Tuesday, October 29, 2013
David Cameron Unveils Plans to Make London a Mecca for Middle East Wealth
David Cameron has announced plans to encourage investment in the UK by Muslim countries, saying he wants to make London “one of the greatest centres for Islamic finance anywhere in the world”.
Politicians and business leaders gathered in the capital for the ninth annual World Islamic Economic Forum – the first time the major event has not been held in a Muslim country.
The Prime Minister appeared on stage alongside a number of world leaders, including King Abdullah of Jordan and the Sultan of Brunei.
Among the measures unveiled was a plan from the Treasury to issue an Islamic bond - or sukuk - worth around £200 million. It would issue fixed returns based on the profit made by a named asset, allowing for Muslims to invest without breaking Islamic laws forbidding interest-bearing bonds.
A “world first” set of indices at the London Stock Exchange to help investors identify faith-compliant firms and projects was also announced as well as a £4.5 million boost to a small business growth fund.
The global market in Islamic investments is rapidly expanding, rising by 150 per cent since 2006 and expected to be worth £1.3 trillion next year.
Mr Cameron said Britain had already taken steps to ensure Muslims were not discriminated against - such as ending “double tax” on Islamic mortgages and introducing alternative forms of student and start-up loans to comply with a ban on interest payments.
It already had more Islam-compliant banks than any other Western country and many law firms and university courses centred on the subject, he said.
But he said that his ambition was for the country to compete with finance centres such as Dubai and Kuala Lumpur - not just other non-Islamic capitals. Read on and comment » | Adam Withnall | Additional reporting by PA | Tuesday, October 28, 2013
Islamic Investment: David Cameron Moves to Make London a Mecca for Middle East Wealth
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| The Shard, the tallest building in Europe |
The Prime Minister will signal his determination to tap into the rapidly growing global market for Islamic investments, which are forecast to reach £1.3 trillion next year as oil-rich states fund major building projects.
He will set out plans to establish a new Islamic index on the London Stock Exchange, which will help investors comply with Islamic finance principles, such as bans on investing in alcohol, tobacco and gambling. He will also detail proposals for Britain to become the first country outside the Muslim world to issue its own Islamic bonds, known as sukuk. » | Nigel Morris | Tuesday, October 29, 2013
Sukuks [or Traditional Bonds]: What’s the Difference?
The essential difference with a conventional bond is that each sukuk represents a share of ownership of the asset you are investing in. Regular bonds represent a share of debt.
Whereas normal bonds do not give the investor a share of ownership in the project they support, sukuk investors get partial ownership.
The criteria for what you can invest in with a sukuk is limited. It must be sharia-compliant. Conventional bonds which can be used for anything.
Bond holders receive regularly scheduled interest payments for the life of the bond - often at a fixed rate - and they are not affected by costs related to the asset.
Sukuk holders receive a share of the profit and accept a share of any loss incurred. [Source: Mail Online] | Tuesday, October 29, 2013
Britain to Become First Non-Muslim Country to Launch Sharia Bond
Britain is set to become the first non-Muslim country to sell a bond that can be bought by Islamic investors in a bid to encourage massive new investment into the City.
David Cameron will say in a speech on Tuesday at the World Islamic Economic Forum in London that the Treasury is drawing up plans to issue a £200m Sukuk, a form of debt that complies with Islamic financial law.
The new sharia-compliant gilt will enable Britain to become the first non-Muslim country to tap the growing pool of Islamic investments that is forecast to top £1.3 trillion by next year.
The Prime Minister will say that it would be a “mistake” to miss the opportunity to encourage more Islamic investment in the UK and that the City of London should rival Dubai as a centre for sharia-compliant finance.
“When Islamic finance is growing 50pc faster than traditional banking and when global Islamic investments are set to grow to £1.3 trillion by 2014, we want to make sure a big proportion of that new investment is made here in Britain,” Mr Cameron will tell an audience of senior officials from Islamic countries.
Among those at the meeting are Sultan Hassanal Bolkiah of Brunei, King Abdullah of Jordan, Afghan president Hamid Karzai and Prince Salman bin Hamad Al Khalifa, Crown Prince of Bahrain.
The World Islamic Economic Forum has never been held before in a non-Muslim country and highlights the growing role London is playing in the Islamic finance industry. » | Harry Wilson | Tuesday, October 29, 2013
Wednesday, August 18, 2010
FINANCIAL TIMES: Malaysia and the Gulf have been the traditional strongholds of Islamic bond issuance, but the market is beginning to broaden to other countries, Muslim and otherwise.
On Monday Norton Rose, the law firm, revealed it had advised on a $10m mini-issue by International Innovative Technologies, a maker of industrial milling machines in north-east England. It raised $10m from Millennium Private Equity, based in Dubai.
Millennium will be the sole investor in the sukuk, which will be listed on the Cayman Islands Stock Exchange. The sukuk will pay 10 per cent a year and expire in 2014. It uses a musharaka structure, also known as profit and loss sharing, allowing Millennium an option to take a stake in IIT.
The offering is the first by a European corporate. Other prominent international companies, though, have tested the waters. >>> Robin Wigglesworth | Wednesday, August 18, 2010
Monday, October 05, 2009
THE WALL STREET JOURNAL: DUBAI -- Global issuance of sukuk, or Islamic bonds, rallied during the third quarter with the value of sukuk issued rising 82% in the latest sign that confidence is returning to capital markets.
Data from Zawya.com's Sukuk Monitor shows the value of Islamic bonds issued world-wide for the third quarter rose to $6.2 billion, from $3.4 billion for the same quarter of 2008.
Investors are putting more faith in the sukuk market, seen as a more stable platform to raise capital, as the financial crisis eases and global market conditions improve rapidly, bankers say.
Sentiment over the $3.5 billion sukuk due in December by Nakheel, a real-estate unit of government-owned Dubai World, has improved in recent weeks after Sheik Mohammed bin Rashid Al Maktoum, Dubai's ruler and prime minister of the United Arab Emirates, said the emirate can meet debt obligations, estimated at as much as $80 billion.
Both conventional and Islamic deals were successfully placed, as investors became more comfortable with the economic environment.
Total global sukuk issuance stood at $13.5 billion at the end of September, data from Zawya's Sukuk Monitor shows. That is close to the total global market for primary Islamic bonds in 2008, which raised $15.2 billion, according to Zawya.com.
Mukhtar Hussain, global chief executive officer of HSBC Amanah told Zawya Dow Jones in a recent interview that the volume of Islamic bonds issued globally this year could hit $15 billion as the financial crisis eases and global market conditions improve rapidly. >>> Mirna Sleiman | Monday, October 05, 2009
Friday, September 18, 2009
REUTERS – INDIA: PARIS - The French parliament passed a law on Thursday which will facilitate the issuance of Islamic bonds despite opposition from leftist parties.
The adoption of the law, which was voted in by the Senate, or upper house of parliament, on June 9 modifies the legal framework for what is known as "fiducie", the French equivalent of trust in the United Kingdom.
In theory, this should facilitate the issuance of Islamic bonds, also known as "sukuk", although the government has been working on an alternative tool for issuing such debt, which could involve further legal measures.
The move is part of France's two-year drive to create a new European hub for Islamic finance, whose value globally is estimated at $1 trillion.
The ruling UMP party and the New Centre voted for the law while opposition came from the Socialist Party and other left-leaning groups, highlighting resistance from some quarters in France to altering the law in a way that could be seen to affect secular traditions.
"We are introducing Islamic law into the French legal framework," said Henri Emmanuelli from the Socialist Party. "This deeply shocks us, it is unacceptable," he said. Some experts hope that France… >>> Additional reporting by Cecilia Valente in London; Reporting by Emile Picy; Editing by Ruth Pitchford | Thursday, September 17, 2009
Wednesday, May 06, 2009
FINANCIAL TIMES: The ultimate arbiters of the Islamic finance industry are not regulators, bespoke-suited bankers or the authorities, but a small, select coterie of ascetically garbed scholars versed in Koranic verses and arcane areas of jurisprudence.
This was made abundantly clear last year, when Sheikh Taqi Usmani, a leading scholar of sharia-compliant finance, shocked the industry by declaring many Islamic bonds, or sukuk, had gone too far in mimicking conventional debt.
Bankers and lawyers debate whether it was Sheikh Taqi or the credit crunch that caused the sukuk market to clam up: most admit the denouncement did not help.
The sharia supervisory boards – that Islamic banks must have – approve or ban transactions, products and services but do not become involved in credit policy or portfolio choices.
This can bring them into conflict with bankers who have conjured up increasingly complicated products.
“I’ve seen banks where the relationships were close, and others where they were tense, but everyone knows you cannot do anything without the scholars’ blessing,” says an industry insider.
Bankers say – until the credit crunch – the scarcity of sharia scholars was the biggest drag on growth of the Islamic finance industry.
Islamic banks have multiplied in recent years, thanks to government support, a profusion of petrodollars and a favourably inclined customer base in much of the Muslim world.
However, the number of scholars qualified to pass judgment on banks has remained low at about 30-40.
In addition to exhaustive knowledge of sharia and Islamic jurisprudence, scholars have to be financially knowledgeable and comfortable with English – the language of most financial and legal documentation. >>> By Robin Wigglesworth | Tuesday, May 5, 2009
Wednesday, April 15, 2009
REUTERS: DUBAI - Since a revered Islamic scholar spoke out against some sukuk structures more than a year ago, issuers have refocused their attention on the ijara Islamic bond model, bankers said on Wednesday.
Some bankers have attributed last year's downturn in issuance of sukuk, the Islamic alternative to Islamic bonds, to comments by Sheikh Muhammad Taqi Usmani that musharaka and mudaraba sukuk should not promise guaranteed returns.
Most Islamic bonds should be treated as equity instruments, said Usmani, chairman of the board of scholars at the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI).
His February 2008 comments marked a shift for Muslims seeking fixed-income returns and, in the following months, coincided with a slowdown in the sukuk market as the global financial crisis deepened.
But bankers at the Reuters Islamic Finance Summit on Wednesday downplayed that link, saying the general slump in the global debt market was behind the drying up of sukuk, not a fear the structures failed to comply with the spirit of Islam.
"The sukuk market has shrunk as a direct result of the market conditions rather than an issue with the structures themselves," said Raphael de Ricaud, head of Islamic finance at Rothschild, an investment bank providing advisory services. >>> By Daliah Merzaban | Wednesday, April 15, 2009
Tuesday, February 10, 2009
REUTERS: LONDON/MANAMA - Cash-strapped Western companies are considering issuing Islamic bonds to tap Middle Eastern investors but face a challenge in choosing the right instrument, bankers and asset managers said.
Companies, especially in the UK and France, are looking to Islamic compliant investors as alternative sources of finance as the global crisis restricts their usual funding routes.
"There is a lot of interest from corporates to issue sukuk. My feeling is that as liquidity in the West gets scarce, they will look into the Middle East," said London-based Adnan Aziz, head of sharia advisory and structuring at asset manager BMB Group.
British retailer Tesco (TSCO.L) issued its first sukuk -- or Islamic-compliant debt --in 2007 for its Malaysian unit as well as raising conventional debt.
Islamic bonds do not pay interest, which is banned under Islamic law or Sharia, and are structured as profit-sharing or rental agreements, underpinned by physical assets such as real estate or commodities.
"We have discussions with clients, conventional issuers in Europe and we pitch both solutions, (bonds and sukuk) that is going to be a trend going forward," said Vikrant Bhansalim, who works for French bank Societe Generale (SOGN.PA) in London.
"In today's world the corporate sector is interested in the right price, the format is not as important," he said. >>> Reuters | Tuesday, February 10, 2009
The Dawning of a New Dark Age (Paperback & Hardback) – Free delivery >>>
REUTERS:
Indonesia Reports Strong Demand for First Retail Sukuk >>> Reuters | Tuesday, February 10, 2009
SMART BRIEF: Report Details Growth of U.K.'s Islamic Finance Sector
A report by International Financial Services London found that the Islamic finance sector in Britain, with $18 billion in assets, is much larger than that of Pakistan, Turkey, Egypt and Bangladesh, countries where Islam is the primary religion. The report also states that the U.K. leads Western countries in the number of financial institutions focused on Muslims and sharia-compliant products. >>> The Telegraph | Tuesday, February 10, 2009
The Dawning of a New Dark Age (Paperback & Hardback) – Free delivery >>>
Friday, May 09, 2008
The Dawning of a New Dark Age (Paperback - UK)
The Dawning of a New Dark Age (Hardback - UK)
Monday, February 18, 2008
ANGLO-AUSTRALIAN NATIONAL COMMUNITY COUNCIL: new sharia law controversy erupted last night over Government plans to issue special "Islamic bonds" to pay for Gordon Brown's public-spending programme by raising money from the Middle East.
Britain is to become the first Western nation to issue bonds approved by Muslim clerics in line with sharia law, which bans conventional loans involving interest payments as "sinful".
The scheme would mark one of the most significant economic advances of sharia law in the non-Muslim world.
It will lead to the ownership of Government buildings and other assets currently belonging to British taxpayers being switched wholesale to wealthy Middle-Eastern businessmen and banks.
The Government sees sharia-compliant bonds as a way of tapping Middle-East money and building bridges with the Muslim community.
But critics say the scheme would waste money and could undermine Britain's financial and legal systems.
Senior Conservative MP Edward Leigh, chairman of the Commons Public Accounts Committee, said: "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."
A spokesman for the National Secular Society said: "There are lots of different ways to arrange financing.
"Constructing financial instruments to be sharia-compliant seems to me to involve a lot of unnecessary complication, which will serve only to make a lot of lawyers very rich."
The attempt to embrace Islamic financing would also appear to be at odds with Mr Brown's promise to promote Britishness and British values and institutions.
The Treasury has already faced heavy criticism for removing Britannia from 50p coins.
Other Western nations have been reluctant to issue Islamic bonds. Shari’a now official in Britain >>>
Mark Alexander (Paperback)
Mark Alexander (Hardback)
Tuesday, December 04, 2007
TOWNHALL.COM: Suddenly, a new national debate is beginning about the national security, economic and other implications of Persian Gulf potentates using their petrodollars to buy up strategic American assets. Most recently, the Emir of Dubai’s purchase at fire-sale prices of 4.9 percent of the largest U.S. bank, Citigroup, has caused a level of unease not seen since he tried to buy his way into a large number of this country’s port facilities.
Almost completely unremarked thus far has been a parallel – and in many ways far more insidious – effort to penetrate, influence and dominate America’s capital markets: so-called “Shariah finance.” Some estimates suggest that there are approaching $1 trillion now being invested around the world under this rubric. If present trends continue, all other things being equal, such funds may grow to many times that amount within a few years.
Shariah is, of course, the term used by adherents to the totalitarian ideology practiced by the Saudi Wahhabis, the Iranian mullahs and the Taliban to describe the all-encompassing theocratic code they use to justify repressive rule at home and to extend their dominance elsewhere. While it is often depicted by its promoters as Koranic in character, in fact, it is largely man-made, the product of dictates and rulings by caliphs and scholars over many centuries.
For non-Muslims, Shariah is best known for its sanction for the brutalization of women, homosexuals and Jews. Beheadings, amputations, flagellation and stoning are among the prescribed punishments for those who transgress this barbaric code, punishments plucked from primitive tribal practices in the Arabian deserts dating back to medieval times. Shariah’s Trojan Horse >>> By Frank J. Gaffney Jr.
Frank Gaffney Jr. is the founder and president of the Center for Security Policy and author of War Footing: 10 Steps America Must Take to Prevail in the War for the Free World (Hardcover)
Mark Alexander (Hardback)
Mark Alexander (Paperback)
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