Deals of the Year 2013: Results

The World’s Leading Islamic Finance News Provider 8th January 2014

(All Cap) 1050 Deals of the Year 2013: Results

1,020.19 the Islamic fi nancial market players are 1025 adapting. As always, the Islamic syndicated 1,029.27 fi nance market fi lled gaps that the Sukuk 1000 0.89% markets were not able to cover. A number of private equity, corporate fi nance and real estate equity deals also drew att ention. 975 In all, you nominated nearly 400 deals 950 (a 33% increase over 2012) in over 30 T F S S M T 2013 categories (a 20% increase over 2012). The Powered by: IdealRatings® Some bankers and analysts were 2013 Deal of the Year competition soared Volume 11 Issue 1 disappointed that 2013 brought a less past the record set in 2012. robust performance in the Sukuk sector IFN Rapids ...... 2 than 2012’s record-sett ing year. However, Although 2013 showed more execution Islamic Finance news ...... 23 the leading markets continued to cement of well-tested ideas than innovation and Shariah Pronouncement ...... 39 their strong performance, while new despite local political unrest in several key players also emerged on the scene to IFN Reports: countries and global markets as well as demonstrate the ever-widening global the dismay over tapering, 2013 remained a Malaysian Sukuk outlook positive for 2014: scope of the Islamic capital market. good year for the Islamic capital markets. Corporates to drive growth; Maxis’ proposed Sukuk receives preliminary ratings; Cross- The UAE re-emerged as a leading center for The top nominees for Deal of the Year Sukuk issuance in 2013. With the new UAE border skills and knowledge exchange: On the included Saudi Arabian General Authority Sukuk rules expected in early 2014 and the of Civil Aviation (GACA), Malaysia Building increase; Regulatory revisions for the new ratcheting up of Dubai’s plans to become Society (MBSB), East Delta Electricity year ...... 40 the leading center of the Islamic economy, Production Company and Emirates Special Report: we should expect Dubai to grow its role as Airlines. Each of these deals represented an Shariah compliant technology stocks ...... 44 a jurisdiction of choice for Islamic capital important landmark in the industry, or a market transactions. new development of benefi t to the market. With GACA as the largest MENA Sukuk Country Focus: Syria As always, Malaysia provided the largest issuance ever; East Delta delivering a new IFN Analysis: A country in crisis ...... 42 universe of deals to analyze. Keeping their product during diffi cult times; and the MBSB hat in the ring, the number of cross-border and Emirates deals demonstrating new deals from Malaysia is also growing as concepts that may be replicated throughout Sector Focus: Islamic Debt Capital Malaysian fi nanciers supported deals in the markets, no choice was easy. Market Indonesia, Saudi Arabia, and Singapore. IFN Analysis: A new year for Islamic debt Nearly three years in the making, the capital markets ...... 43 Saudi Arabia’s strong domestic Sukuk market International Islamic Liquidity Management enjoyed the fi rst ever clear sovereign support Corporation (IILM) issued its fi rst Sukuk for an Islamic capital markets transaction. in 2013. Designed to support the Basel III- Asset Management Feature: Asset Turkey, Pakistan and Indonesia continued to driven needs of Islamic banks to have access management and Chit funds ...... 48 make contributions, whilst Egypt, Nigeria to high-grade, easily traded securities, IFN Country Correspondents: and Oman jumped onto the Islamic capital the transaction was well received. Finally markets scene with notable deals. stepping into its role to support the Islamic Qatar; Turkey ...... 45 fi nancial services industry, the inaugural IFN Sector Correspondents: The fi rst hint of tapering threw a scare into Sukuk of the IILM won the Islamic Finance Takaful ...... 47 the Islamic capital markets in mid-2013. news Deal of the Year for 2013. Deal Tracker ...... 49 Nonetheless, as the slowing of quantitative easing in the US becomes a fact, most of (The IFN DOTY Awards Board) REDmoney Indexes ...... 50 Eurekahedge data ...... 52 KualaKuK alla LLuLumpur:mppur: DDuDubai:bai: Performance League Tables ...... 54 Shangri-LaShhanggri-La RiRitztz CCarltonarllton ((DIFC)DIFC) th th Events Diary...... 58 19 FebruaryFebruary 20142014 224 FebruaryFebebruarruaary 2014 Company Index ...... 59 JJoiJoin uuss ata t th theheh ini indindustry’sindustryndusustrtrytrtry’sy s most prestppre prestiprestigiousresttigiousttiiiggioiouiousas a ndn ToT reservereseerve your tatable,blbleb ep, ppleaselease ccall:call: Subscription Form ...... 60 recocognniizzedd awaardds ceremoniese , cecellebbrata inng Dubai:Dubai: GGeraldineeraldine CChan:han:n ++971971 44 2732773 6628282 the bbestt ofof IIsllamimic finfi anceana ce KuKualaala LuLumpur:mppur: StSteveevve StStubbs:tubbs: ++6+60303 22162162 78780000 eextxt 5555 www.islamicfi nancenews.com IFN RAPIDS

Noor Islamic Bank to dispose Ableace Raakin and Takaful industry to maintain DEALS of entire stake in Meezan Amanie Group join forces steady growth in 2014 Boustead Holdings to issue Bank to create Dubai-based joint according to industry experts venture eyeing commodity Sukuk worth up to US$209.53 Tax on Malaysian Private Takaful International Murabahah businesses in the million by the end 2013 Retirement Scheme to be Company announces Middle East 1Malaysia Development waived for retirees above the new sanctions for 2014 plans second Islamic debt age of 55 Islamic banking assets in including increased Wakalah rapid growth markets to hit management fee off ering to fund air force base iSfi n signs partnership US$1.6 trillion by 2018, with relocation with Azmi & Associates in MAA Takaful to launch seven Malaysia holding at least Malaysia new Family Takaful products Securities Commission US$390 billion, says EY in the fi rst half of 2014 Malaysia approves Ahmad Meezan Bank to assist Zaki Resources’ proposed National Bank of Pakistan to Takaful Oman Company’s Sukuk Murabahah worth up convert the prime minister’s ASSET listing on Muscat Securities to US$306.77 million Youth Business Loan Scheme MANAGEMENT Market postponed until Bank Asya submits into a Shariah compliant quorum is met fi nancing program Cheraman Financial Services application to issue Sukuk Al Madina Insurance receives permission to launch worth up to US$500 million Pakistan’s Steering Committ ee Company commences Islamic venture capital fund KDU University College for the Promotion of business as Oman’s fi rst issues second tranche of Islamic Banking to deliver Abraaj Group talking to Takaful operator following US$106.48 million Sukuk recommendations by the 31st Turkish food and education regulatory approval January fi rms for possible investment program AIG Malaysia Insurance to Federal government of BIMB completes Bank Islam Islamic banks to fully manage begin re-Takaful operations Pakistan to auction US$847.06 acquisition Indonesia’s Hajj funds by the this quarter end of next year million in Sukuk to fund Business Custodians debuts airport and motorway fi rst Queensland-based First Guardian aims to launch RATINGS maintenance Islamic investment fund Islamic pension fund this RAM maintains MRCB month Bank Rakyat launches second Al-Falaah to roll out Islamic Southern Link’s Sukuk Sukuk issuance under its microfi nance products in Al Meezan Investment ratings on Rating Watch US$2.73 million proposed April Management launches new Fitch affi rms Saudi British Islamic securities program Islamic fund TKSB and the IDB sign Bank at ‘A’ with a stable Amana Bank’s IPO receives US$220 million Mudarabah Essel Finance eyeing outlook full subscription partnership to fi nance energy Malaysian and West Asian Ratings outlook for 2014 projects partners to launch US$100 Luxembourg plans to issue stable for GCC banks million Shariah compliant sovereign Sukuk following New guidelines on Islamic according to Fitch off shore fund introduction of government bill securities from Labuan Financial Service Authority AAOIFI to receive fi nancial MOVES NEWS come into eff ect support from Bahrain’s Waqf Fund to develop CIPA Gulf Bond and Sukuk European Islamic Investment Banque Misr grants Upper program under recently- Association makes key Bank to increase stake in Egypt Electricity Production approved US$1.4 million appointments Rasmala Holdings Company a diminishing budget CEO of the National Bank Musharakah facility worth IFC enters into a risk-sharing of Kuwait to step down aft er US$35.75 million for station facility agreement to increase three decades of service renovation level of available renminbi- TAKAFUL Central Bank of Libya meets denominated trade fi nance in AMMB chooses MetLife as Dubai Islamic Insurance & with Islamic banks to assess China new equity partner for Family Reinsurance makes two key Takaful and life insurance appointments the effi cacy of the country’s The IDB approves US$285.4 operations implementation of Shariah million-worth of development National Bank of Abu Dhabi fi nance funding for new projects Stronger performance appoints head of corporate expected of Takaful Re as and institutional banking for Bangladesh Petroleum World Bank signs agreement parent company assumes its Hong Kong operations Corporation procures IDB with Bait Al Mashura tighter control over fi nancing to fund increasing to further research and underwriting operations oil imports cost knowledge in Islamic fi nance

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IFN Deals of the Year 2013: Results Continued from page 1

DEAL OF THE YEAR: International Islamic Liquidity Management Corporation (IILM) Deal Size: US$490 million from a US$2 billion program Primary Dealers: Abu Dhabi Islamic Bank, AlBaraka Turk, CIMB Bank, Europe's KBL Private Bankers, Kuwait Finance House, Maybank, National Bank of Abu Dhabi, Qatar National Bank and Standard Chartered Bank Lawyers: Allen & Overy for the issuer and Freshfi elds for the sponsor Shariah Advisors: IILM Rating: S&P: ‘A-1’ Date: 26th August 2013 The Islamic Liquidity Management purchased by IILM Holding 2. The As a result, the IILM’s Sukuk have Corporation (IILM) is an international Sukuk were issued by sovereign- strong global support as they represent institution established by central banks, related entities and were issued in a unique collaboration between several monetary authorities and multilateral Ijarah and Murabahah format. In central banks and a multilateral organizations in 2010 to create and issue order to ensure the Sukuk achieved development bank. short-term Shariah compliant fi nancial the rating requirements for the short- instruments to facilitate eff ective cross- term Sukuk program, collateral and Apart from meeting the market demand border Islamic liquidity management. credit enhancement features were for highly rated short-term Shariah incorporated into the deal. compliant cross-border liquidity The IILM issued its fi rst Sukuk from instruments, the IILM short-term Sukuk a US$2 billion short-term Sukuk 1. The Sukuk are tradable US dollar- complement the intermediate and program. Rated by S&P, the issuer is a denominated short-term fi nancial long-term Sukuk currently available in Luxembourg incorporated securitization instruments with maturities of up to the market. The US dollar short-term vehicle. One reason for the diffi culty in one year; cross-border Sukuk should address launching was how to acquire access the challenges that Islamic fi nancial to government-sponsored assets in 2. The Sukuk qualify as money-market institutions face in managing their sponsor state jurisdictions. The deal also instruments backed by sovereign liquidity more eff ectively and effi ciently. had to reconcile Shariah principles with assets; and Luxembourg civil law. Honorable Mention for Deal of the Year 3. The Sukuk are tradable globally via included GACA; Malaysia Building Society; Underlying the deal are a number of a multi-jurisdictional primary-dealer East Delta Electricity Production Company; Sukuk issues which were privately network. and Emirates Airlines.

MOST INNOVATIVE: Telekom Malaysia Deal Size: RM200 million (US$60.84 million) Arrangers: CIMB Investment Bank and Maybank Investment Bank Lawyers: Adnan Sundra and Low for the issuer and Zaid Ibrahim & Co for the arrangers Shariah Advisors: Maybank Islamic Rating: RAM: ‘AAA’ Date: 18th December 2013 Innovation was not a hallmark of 2013. value applying the concept of Sukuk to the universe of intangible assets and Two airlines came to market with seat Wakalah. Telekom Malaysia’s seven-year facilitate Telekom’s speed to market voucher deals (Emirates and Pakistan Sukuk is the fi rst to utilize broadband on future issuances by not requiring International Airlines). Barwa’s The units as an underlying asset. Returns on the company to deal in complex sales First Investor secured Istisnah fi nancing the Sukuk come from a share of the profi t and lease back transactions involving for a major project in the US. And generated by the issuer's broadband land, buildings, or switching stations. DanaInfra launched the fi rst Malaysian services as represented by a specifi c This method is a logical extension retail Sukuk, albeit using tried and true number of broadband units which into the intangible asset base of most methods. Telekom Malaysia sells to customers on telecommunications companies and one behalf of the Sukukholders. may expect to see the method expand Telekom Malaysia’s Islamic commercial globally. paper (ICP) program and Islamic Airtime, toll vouchers and seat vouchers medium-term notes (IMTN) program have already qualifi ed as underliers for Honorable Mention: CityCentreDC; have a total combined limit of up to RM3 Islamic transactions. The application of Emirates Airlines; Pakistan International billion (US$912.57 millon) in nominal broadband units are a unique addition Airlines; and DanaInfra Nasional

IFN Deals of the Year 2013: Results Continued from page 3

SOVEREIGN: Saudi Arabian General Authority of Civil Aviation (GACA) Deal Size: SAR15.2 billion (US$4.05 billion) Arrangers: HSBC Saudi Arabia and NCB Capital Company Lawyers: Cliff ord Chance and Al Jadaan & Partners for the issuer Shariah Advisors: HSBC Saudi Arabia and NCB Capital Rating: Implied sovereign rating Date: 7th October 2013 2013 was the year of sovereigns doing redevelopment of the King Abdulaziz Kingdom. The second wing, essentially a over. Structures and methods were Airport, Jeddah and King Khalid Mudarabah, established the basis for the almost universally repeated from prior International Airport in Riyadh. One deal being tradable. This form of hybrid year deals. In a thicket of similar deals, wing of the fi nance was invested in a has become widely used in the past three GACA just barely pips the rest. Due in Murabahah to create certainty of payment years. 2023, GACA’s second issuance by GACA and redemption. The second wing was was oversubscribed and represented the invested in the purchase of benefi ts owed Honorable Mention: Government of largest ever issuance in the Kingdom of to GACA, which entitles GACA to charge Pakistan; Khazanah Nasional; Government Saudi Arabia and the GCC. The hybrid and collect fees from airlines landing of Dubai; Republic of Indonesia; and Sukuk released funds to fi nance the and parking aircraft at airports in the Republic of Turkey.

CORPORATE FINANCE: Sime Darby Global Sukuk program Deal Size: US$1.5 billion Sukuk Ijarah program: Tranche 1 size: US$400 million (fi ve-year) Pricing: 2.05% (UST + 130 bps) Tranche 2 size: US$400 million (10-year) Pricing : 3.29% (UST + 145 bps) Arrangers: Citi, HSBC, Maybank and Standard Chartered Bank Lawyers: Zul Rafi que & Partners (Malaysian counsel), Linklaters (International counsel) for the issuer; Allen & Overy (International counsel), Zaid Ibrahim & Co (Malaysian counsel) for the arrangers Shariah Advisors: The Shariah Committ ee of HSBC Amanah Malaysia, Maybank Islamic, the Shariah Board of Citi Islamic Rating: S&P: ‘A’ Fitch: ‘A’ Moody’s: ‘A3’ Date: 29th January 2013 In 2013, there was an active corporate benefi cial ownership of assets from issue; the assets themselves may reside fi nance market with a number of Sime Darby. The asset purchases in various subsidiaries of Sime Darby. landmark mergers and acquisitions, resulting from each issuance are to Complexities in the deal related to asset syndications, and a number of creative be applied by Sime Darby to fi nance jurisdiction, matching back-to-back lease deals. Sime Darby’s Reg S program its own or its subsidiaries' working arrangements, and ease of determining is Asia’s fi rst internationally rated capital requirements, to fi nance future the execution of transfer of benefi cial multi-currency Sukuk program based investments, capital expenditure, and/ ownership. on an Ijarah structure. The issuer, or to refi nance debt obligations of Sime Darby Global, is an SPV which the parent or any subsidiaries. Each Honorable Mention: BIMB Holdings; Gulf operates a multi-currency Islamic issue of Sukuk has a diff erent group Marine Services; S P Setia; and Dabbagh securities program by acquiring the of plantation assets underlying the acquisition of stake in Petromin.

RESTRUCTURING: A'ayan Leasing and Investment Company Deal Size: US$1.3 billion Arranger: Creditor Steering Committ ee Lawyers: DLA Piper for A’ayan and Allen & Overy continues to act for the steering committ ee, with support from ASAR Al Ruwayeh & Partners in relation to Kuwaiti law issues Shariah Advisors: Each of the creditors and obligors Rating: Unrated Date: December 2013 The problems of the fi nancial crisis stability law in Kuwait (Decree No. 'haircut' arrangements, debt-for-equity are slowly fading away in the GCC. 2 of 2009). As a Shariah compliant and debt-for-asset swaps. Many of these In 2013, there were many high company, the defaulted structures were fi rst applied in the Kuwaiti legal profi le restructurings. A’ayan was included Murabahah and other Islamic and regulatory context. one of the standouts as it was the instruments. The ultimate restructuring fi rst Shariah compliant restructuring involved a number of innovative Honorable Mention: Arcapita; Dana Gas; under application of the fi nancial restructuring techniques including Noor Hospitals; and DEWA.

IFN Deals of the Year 2013: Results Continued from page 4

CROSS-BORDER: International Bank of Azerbaĳ an Deal Size: US$120.5 million Arrangers: Barwa Bank, Emirates NBD Capital, JPMorgan and Noor Islamic Bank Lawyers: Norton Rose Fulbright/Omni Law Firm Shariah Advisors: The committ ees of the arrangers Rating: Moody's: ‘Ba3/Negative’ Fitch: ‘BB/Stable’ Date: 16th July 2013 The nominated high quality cross- of the Kuwait International Airport that a substantial number of banks in border deals in 2013 was diverse and form Dubai Islamic Bank. Atlanticlux the GCC have no country limits for exciting. The top nominees opened Lebensversicherung generated funding Azerbaĳ an. When the deal was being new markets, found innovative ways for FWU’s Takaful operations. Abu pulled together, the syndicate had to to raise capital, and posed a challenge Dhabi Equity Partners opened the Brazil overcome internal diff erences about for us to make decisions. Maran Nakilat market with a novel trading platform. how to execute the Tawarruq structure. brought Qatari funds to a new market And Arcapita famously reorganized The bank itself is conventional with in Greece. Al Noor Hospitals Group their debts in New York bankruptcy an Islamic window, as Islamic fi nance raised equity and listed on the London court. is still in its infancy in Azerbaĳ an. On Stock Exchange (LSE), applying the the one hand, the deal contributes to proceeds to its healthcare business The International Bank of Azerbaĳ an building this market. On the other in the UAE. Mobily brought in the stands out as the opening of a new hand, the size of the market means that largest joint Scandinavian export credit Islamic fi nance destination for GCC opportunities are limited. agency (ECA) fi nancing to the MENA and American banks. The cross-border region and introduced Finland’s ECA Islamic syndicated fi nancing transaction Honorable Mention: Maran Nakilat; Al to the Islamic market. Kuwait’s Al was the fi rst Islamic facility raised Noor Hospitals Group; Mobily; Al Kharafi Kharafi Group secured its guarantees for an Azerbaĳ ani bank. Among the Group; Atlanticlux Lebensversicherung; for the modernization and expansion key obstacles to the deal was the fact Abu Dhabi Equity Partners; and Arcapita.

SYNDICATED: Gulf Marine Services Deal Size: US$340 million Arrangers: Abu Dhabi Islamic Bank, Abu Dhabi Commercial Bank, First Gulf Bank, Qatar Islamic Bank, Noor Islamic Bank, United Arab Bank, Al Hilal Bank, Ajman Bank, Mubadala GE Capital and Mashreq Lawyers: Gibson, Dunn & Crutcher for the obligor and White & Case for the arrangers Shariah Advisors: Abu Dhabi Islamic Bank Rating: Unrated Date: June 2013 The 2013 syndication market was active feature in Murabahah deals. Gulf fi nance expansion, and meet ongoing with a number of mega deals across Marine Services is a regional leader in working capital requirements. The markets as well as well-targeted smaller the provision of services requiring self deal is secured with an assignment of syndications in local markets. Although elevated support vessels and anchor contracts, mortgage over vessels, with a the CityCentreDC deal represents the handling tug supply vessels. Generally, low investment-to-value ratio. The deal opening of a new market, the method is the asset-heavy company serves the has covenants and credit enhancements the tried and true Istisnah. Astra Sedaya oil, gas and renewable energy sectors. which include a cash sweep. The Finance was remarkable as the fi rst In addition to vessels, the company Ijarah is structured to facilitate an Wakalah syndication for Indonesia. The off ers off shore accommodation, well uncommitt ed line to future capital Saudi ARAMCO Mobile Refi nery relied maintenance, project management, expenditures and business expansion. on Tawarruq. construction and installation services. Honorable Mention: CityCentreDC; Astra The Gulf Marine Services deal is The complex Ijarah transaction allowed Sedaya Finance; and Saudi ARAMCO structured to provide a fl exible secured Gulf Marine Services to re-profi le Mobile Refi nery. facility to the company and to provide of existing debt into a multi tranche for future cash needs, an uncommon facility, fund a US$80 million dividend,

IFN Deals of the Year 2013: Results Continued from page 5

SUKUK: International Islamic Liquidity Management Corporation (IILM) Deal Size: US$490 million from a US$2 billion program Primary Dealers: Abu Dhabi Islamic Bank, AlBaraka Turk, CIMB Bank, Europe's KBL Private Bankers, Kuwait Finance House, Maybank, National Bank of Abu Dhabi, Qatar National Bank and Standard Chartered Bank Lawyers: Allen & Overy for the issuer and Freshfi elds for the sponsor Shariah Advisors: IILM Rating: ‘A-1’ – S&P Date: 26th August 2013 Many interesting Sukuk deals were on the global or national level. But, management and qualify as high quality delivered to the market in 2013: the long-awaited International Islamic investments for Basel III purposes. DanaInfra with the fi rst retail Sukuk in Liquidity Management Corporation Malaysia; Malaysia Building Society; (IILM) Sukuk program off ering Honorable Mention: DanaInfra Nasional, Saudi Electricity Company; Osun investment grade tradable Sukuk Malaysia Building Society; Saudi Electricity Sukuk; Bank Asya; Ooredoo; Sadara; is the Sukuk deal of the year. IILM Company; Osun Sukuk; Bank Asya; and Sime Darby all represent important delivers instruments which facilitate Ooredoo; Sadara; and Sime Darby. landmarks in the Sukuk market either eff ective cross-border Islamic liquidity

EQUITY: BIMB Holdings Deal Size: Renounceable rights issue of 426.72 million new ordinary shares of RM1 (US$0.3) each in BIMB Holdings (BHB Shares) (Rights Shares) together with 426.72 million free detachable warrants at an issue price of RM4.25 (US$1.29) per Rights Share on a basis of two Rights Shares and two Warrants for every ﬁ ve existing BHB Shares held as at 5pm on the 12th November 2013 to raise gross proceeds of RM1.81 billion (US$551.75 million) Arranger: Bank Islam Malaysia Lawyers: Wong & Partners Shariah Advisors: Shariah Supervisory Council of Bank Islam Rating: Unrated Date: 11th December 2013 (Sukuk were issued the next day) and funds were applied to acquisitions on the 19th December 2013 Several private equity deals were of RM1.66 billion (US$505.04 million) The overall structure was designed nominated including Alkhabeer’s (nominal value). The proceeds of the to optimize the capital structure of Express Publishing & Investment issuances were applied to allow BIMB BIMB Holdings and achieve the correct which demonstrates the emergence Holdings to acquire the remaining 49% combination of equity and debt. The of generational change in many UAE of issued and paid-up share capital transaction is structured with covenants businesses founded by South Asian of Bank Islam from Dubai Financial to ensure transparency and protection of entrepreneurs; and RHB Investment Group (30.47% of the issued and investor's rights. Bank’s Weststar Aviation Services which paid-up share capital of Bank Islam brought Kohlberg Kravis & Roberts for a cash consideration of US$550 This deal was the largest fund raising (KKR) into the Islamic ambit for a million and from Lembaga Tabung exercise via Rights Issue with Warrants in Malaysian deal. Al Noor Hospital’s Haji (18.53% of the issued and paid- the Malaysian ﬁ nancial sector in 2013. The London Stock Exchange (LSE) listing up share capital of Bank Islam) for deal was also the largest such transaction was also notable. But, BIMB Holding’s a cash consideration equivalent to for a publically listed company in is perhaps notable for its strategic US$334.6 million (payment was in Malaysia. The key outcome of the deal is achievement. Malaysian ringgit). The remaining the independence of Bank Islam. funds covered the cost of executing the BIMB Holdings supplemented the transactions and provided additional Honorable Mention: Al Noor Hospitals Rights and Warrants issues with a working capital requirements for BIMB Group; Express Publishing & Investment; 10-year Tawarruq securities issuance Holdings. and Weststar Aviation Services.

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IFN Deals of the Year 2013: Results Continued from page 6

Ĳ ARAH: Siemens Pakistan Engineering Company Limited Deal Size: PKR200 million (US$1.87 million) Arrangers: Meezan Bank Shariah Advisors: Meezan Bank Rating: Unrated Date: December 2013 Some deals of the year are notable for of basic principles to serve their off balance sheet under International size, others for sound execution of customers. Accounting Standards followed by the basics. Certainly, Saudi Electricity the company for its group reporting Company, Kimanis Power and Telekom Meezan structured the operating purposes. As a result, Siemens Pakistan Malaysia all had mega deals in the fi nance lease to enable Siemens Pakistan unlocked cash without increasing market. to continue enjoying the benefi t of fi nancial leverage on its balance sheet. the leased assets. Simultaneously, Both Tilal Development Company the transaction took the assets off of Honorable Mention: Tilal Development (Modern Sukuk Company) and Osun Siemens Pakistan’s balance sheet in the Company through Modern Sukuk Company; Sukuk represented the opening of new local reporting of fi nancial statements Telekom Malaysia; Kimanis Power; Osun markets. Meezan Bank, however, oft en done in accordance with IFAS, and to Sukuk; and Saudi Electricity Company. sticks to the simple and clear application keep both assets and related fi nancing

INFRASTRUCTURE & PROJECT FINANCE: Sadara Chemical Company (as the Project Company) and Sadara Basic Services Company (as issuer of the Sukuk) Deal Size: SAR7.5 billion (US$1.99 billion) Arrangers: AlBilad Investment Company, Alinma Investment Company, Deutsche Securities Saudi Arabia and Riyad Capital Lawyers: Milbank, Tweed, Hadley & McCloy and Allen & Overy for the arrangers Shearman & Sterling (London) and Hatem Abbas Ghazzawi & Co as legal advisors to The Dow Chemical Company White & Case and The Law Offi ces of Dr. Waleed N. Al-Nuwaiser in association with White and Case as legal advisors to Saudi Arabian Oil Company Shariah Advisors: The Joint Shariah Committ ee of Alinma Investment Company and AlBilad Investment Company. DB Shari'a Advisers. The Shariah Committ ee of Riyad Capital Rating: Unrated Date: 28th June 2013 As expected the project fi nance and but not yet, in force Saudi Arabian challenges. A regime was required that infrastructure markets are extremely Sukuk rules. would allow the Sukuk to be issued, important in the Islamic fi nance yet also allow certain aspects of the fi eld. CityCentreDC, Kimanis Power, Listed on Tadawul, the Saudi Arabian inter-creditor arrangements to continue and Deyar Al Balad were all very Stock Exchange, Sadara is only the second to be negotiated with the ECAs and important and distinct projects. The fi rst Sukuk to be approved under new rules. the lenders, without having to consult represented the largest ever Istisnah The structure is declining Musharakah the holders of the Sukuk. The consent construction fi nancing in the US. The with a project Istisnah and Ijarah for pre regime needed to be robust enough to second is a major Malaysian Ijarah- and post-occupation of the Islamic assets. keep the Sukukholders comfortable, based project fi nancing. And Deyar Al The profi t and principal payable under but fl exible enough to accommodate Balad is a smaller Saudi public private the Sukuk are funded by the underlying the continuing discussions with the partnership real estate development in forward lease rentals during construction conventional lenders and the ECAs. Makkah. and actual lease rentals post-construction of the project assets. The Musharakah The transaction also saw a number of The Sadara Basic Services Company ensures that the Sukuk are tradable even enhancements to the structure used on Sukuk forms part of a US$20 billion during the construction period. the preceding Saudi Arabian project multi-source project fi nancing for the Sukuk for SATORP. Foremost among construction of a chemical facility The transaction is particularly notable these was the introduction of a new in Saudi Arabia. The project, when as the sponsors (Saudi Aramco and special purpose entity to act as an constructed, will be one of the world’s Dow Chemical) wanted to issue the ‘authorized agent’ on behalf of Sadara largest integrated chemical facilities. It project Sukuk reasonably early on in in its various capacities as lessee and will be the largest ever built in a single the overall fi nancing timeline — in procurement contractor. phase. Sadara incorporates complex particular, the Sukuk was to be issued inter-fi nancier issues, ECA issues, and prior to the signing of the wider Honorable Mention: CityCentreDC; validation of the newly promulgated, fi nancing, which presented some unique Kimanis Power; and Deyar Al Balad.

IFN Deals of the Year 2013: Results Continued from page 7

IPO: Al Noor Hospitals Group Deal Size: GBP221 million (US$362.78 million) Arrangers: Deutsche Bank and Goldman Sachs International Bookrunners: Deutsche Bank, Goldman Sachs International and HSBC Bank Lawyers: King & Spalding and Linklaters for the issuer and Cliff ord Chance for the arrangers Shariah Advisors: Not applicable Rating Unrated Date: 21st June 2013 This was a light year for IPO facilities at Khalifa Hospital and the and (b) anti-fronting. The Mudarabah nominations. UMW Oil & Gas continued development of new medical structure incorporates complex Corporation was a major transaction centers in Abu Dhabi; and to support the shareholder arrangements to ensure in Malaysia resulting in a new Islamic group’s entry into other key emirates. that close to 100% of the economic stock off ering under the Securities benefi ts in the issuer's local UAE Commission’s new criteria. DAMAC An eye-catching reality is that Al Noor company indirectly revert to the issuer. was also a signifi cant event in the UAE. listed, not in the UAE or MENA region, The structure was rigorously tested by Noor Hospitals, however, brings a not in Malaysia, but on the LSE. The the UK Listing Authority before it was unique fl avor to the IPO segment. shareholding structure involves a approved for purposes of the IPO. The Mudarabah arrangement which allows structure may be replicable to allow Al Noor Hospitals Group took UK investors to acquire an interest in UAE companies to seek international advantage of its GBP221 million IPO to the Issuer's principal limited liability liquidity by listing on a foreign restructure its Abu Dhabi operations. company, incorporated in the UAE, in a exchange. Proceeds of the IPO funded the manner that maximizes foreign control acquisition of a specialty center and in such company while, at the same Honorable Mention: UMW Oil & Gas a group of medical centers for US$50 time, respecting the fundamental UAE Corporation and DAMAC Real Estate million; the expansion of existing laws relating to (a) foreign ownership; Development.

MUDARABAH: East Delta Electricity Production Company Deal Size: US$110 million Arranger: Abu Dhabi Islamic Bank — Egypt and Banque Misr Lawyers: In-house for both sides of the deal Shariah Advisors: Abu Dhabi Islamic Bank — Egypt Rating: Implied sovereign rating Date: January 2013 2013 saw many mega Mudarabah sight and usuance lett ers of credit The transaction is the fi rst corporate deals including Dana Gas; GEMS up to US$110 million in favor of East fi nance Mudarabah of its type deal in Education; Dubai Islamic Bank; Delta Electricity Production Company Egypt, and the fi rst Shariah compliant and Arcapita Investment Holdings for the importation of spare parts for syndication for a major Egyptian public restructuring. Abu Dhabi Islamic the production facility stations. The energy sector entity. In addition to its Bank — Egypt (ADIB Egypt) was not facility covers a fi ve-year base stock Islamic fi nance benefi ts, the fi nancing the largest, but it was executed in supply. The Mudarabah facilities supported a strategic sector at a time diffi cult circumstances and applied a were priced at profi t sharing ratio where power outages were frequently novel structure to purpose for which refl ecting a pre-agreed margin above aff ecting the industrial and commercial conventional banks are oft en quick to the mid-corridor rate as announced sectors and the daily life of every act with fi ne pricing. by the Central Bank of Egypt. The Egyptian. The fi nancing prospectively Mudarabah facility has a term of four helps the obligor to provide electricity in The ADIB Egypt structure relates to years and funds in Egyptian pounds seven strategic governorates. the issuance of lett ers of credit and up to 85% of goods under the lett er their prospective refi nance through of credit documents. The deal is Honorable Mention: Dana Gas; GEMS restricted a Mudarabah fi nance guaranteed by the Egyptian Electricity Education; Dubai Islamic Bank; and facility. The deal was executed for Holding Company. Arcapita Investment Holdings.

IFN Deals of the Year 2013: Results Continued from page 8

MURABAHAH: Mobily Deal Size: US$645.85 million Arrangers: Crédit Agricole Corporate and Investment Bank and Deutsche Bank, London Branch. Lawyers: Latham & Watkins for Mobily and Allen & Overy for the arrangers. Rating: Unrated Date: August 2013 Normally, our Murabahah class does US$320.85 million was a Murabahah could have been contemplated as a true not encompass Tawarruq as we wish facility with the support of Sweden’s trade Murabahah, the counterparties for the category to refl ect the true Exportkreditnämnden for the purchase preferred the fl exibilities that Tawarruq movement of goods between parties. of eligible goods and services from would provide including the facilitating This year, many of the true trade Ericsson AB. The second was a US$325 of multiple tranches. fi nance deals incorporated Tawarruq. million Murabahah facility with the The Mobily US$645 million deal with support of Finnvera, for the purchase For Finnvera the deal represented a northern Europe ECAs highlights the of eligible goods and services from number of fi rsts: its fi rst Islamic deal, its importance of cross-border trade with Nokia Siemens Tietoliikenne Oy. largest deal ever in Saudi Arabia and its non-Muslim countries. This transaction Each deal provides long-term low largest ever deal in the Middle East. follows SEK’s prior deal for Saudi cost fi xed rate fi nancing to Mobily Telecom’s Indonesian subsidiary. The on terms which cannot be found in Honorable Mention: Trading Corporation Mobily deal was disbursed in two commercial banking market. The of Pakistan; Turk-Eximbank; Abu Dhabi tranches backed by the Swedish and proceeds help fund Mobily’s capex Equity Partners; and Bahra Advanced Cable Finnish export agencies. The fi rst of development plan. Although Mobily Manufacturing Co.

MUSHARAKAH: SP Setia Deal Size: RM700 million (US$212.97 million) Arrangers: CIMB Investment Bank, Hong Leong Investment Bank and RHB Investment Bank Shariah Advisors: CIMB Islamic Bank and RHB Islamic Bank Rating: Unrated Date: 13th December 2013 The Musharakah category was also SP Setia’s Sukuk Musharakah program issuance of the deal will be utilized hotly contested with the competition addresses the key issues facing the towards the deal expenses, purchase spilling into the perpetual category. company and helps it to stand out in a of lands, buildings and property; and Each of Malaysia Airports Holdings, large crowd. development and construction costs and UMW Holdings, Pandu Logistics, and working capital of existing and future Sadara Chemical Company had an This Sukuk Musharakah is a perpetual projects; as well as the issuer’s working off ering with strong merits. Sukuk, combining Musharakah and capital. The issuance allows SP Setia Musawwamah, to be issued by a to tap a large pool of funds without SP Setia is a public-listed company Malaysian public listed company in increasing its debt to equity ratio. As a and a prominent property developer. the property sector. The issuance has result, the company preserves fi nancing The company is constantly increasing capacity in the broader market. no fi xed tenure or maturity date, but it its land bank as well as developing does incorporate a step up feature aft er townships. Given the nature of the real The securities are not convertible the fi ft h year. The Sukuk Musharakah estate business, SP Setia requires long- to any class of the Issuer’s ordinary term funding. As a public company, SP was structured to be classifi ed as equity shares avoiding dilution of the existing Setia has to consider the issues relating in the fi nancial statements of the issuer shareholders of the Issuer. to dilution if it issued new shares. while having common features of a fi xed income instrument such as a Honorable Mention: Malaysia Airports Given the lack of favor that real estate periodic distribution to investors thanks Holdings; UMW Holdings; Pandu is currently suff ering, and the Basel III to the Musawwamah element. Logistics; and Sadara. impact on long-term project fi nancing, The net proceeds arising from the

IFN Deals of the Year 2013: Results Continued from page 9

PERPETUAL: SP Setia Deal Size: First issuance of RM609 million (US$185.28 million) from RM700 million (US$212.97 million) authorized Arrangers: CIMB Investment Bank, Hong Leong Investment Bank and RHB Investment Bank Lawyers: Albar & Partners for the issuer Shariah Advisors: CIMB Investment Bank and RHB Islamic Bank Rating: Unrated Date: 13th December 2013 Perpetuals became the ﬂ avor of the Education, one of the largest education million program allows them to top the year in 2013 with the form moving ﬁ rms in the GCC. But, property is the very well-noted competition. into the corporate, education, and real most challenging business segment estate sectors. Al Marai Company as in which to att ract funding. Given the Honorable Mention: GEMS Education; Al the largest integrated dairy company in success of publically listed real estate Marai Company; and Dubai Islamic Bank. the MENA region issued, as did GEMS developer S P Setia to launch its RM700

REAL ESTATE: CityCentreDC Deal Size: US$390 million Project Sponsor: TFI US Real Estate Fund (part of Barwa Bank group) Arranger: JPMorgan Chase Shariah Advisors: The First Investor (member of Barwa Bank Group) Rating: Unrated Date: May 2013 As always, real estate is a deeply desired master sub-lease structure for real estate which including many leading US investment for Muslim investors. This acquisition. CityCentreDC, however, is a banks. The project itself is a major year’s nominations included a number landmark. It is the largest ever domestic urban redevelopment project in the US of interesting deals. Deyar Al Balad US Islamic real estate fi nancing for GCC capital. Composed of multiple offi ce was proposed a Makkan public private investors. and residential buildings, the project is partnership for real estate development. a short walk from the Capitol Building, The SAR4.3 billion (US$1.14 billion) It is one thing to build on Key Bank’s sporting arenas, and the convention Arabian Centers Company was the 2002 authorization to use Istisnah and center. largest fi nancing for a private sector another to craft suitable tax-friendly company in Saudi Arabia. DLA Piper documentation. The process took nearly Honorable Mention: Deyar Al Balad; nominated Alkhabeer’s Park 10 US 18 months aft er selection of JPMorgan Arabian Centers Company; and Park 10. acquisition, which applied the well-tried Chase to lead the fi nancing syndicate

TAWARRUQ: Maran Nakilat Deal Size: US$662.4 million Arrangers: Qatar Islamic Bank and Barwa Bank Lawyers: Latham & Watkins for the issuer and Allen and Overy for the arrangers Shariah Advisors: Qatar Islamic Bank and Barwa Bank Shariah Boards Rating Unrated Date: 26th June 2013 Tawarruq, oft en termed commodity Maran Nakilat jumps ahead of the facilitates the use of shipping mortgages Murabahah, is the process of generating crew for its various characteristics. The which are well understood in the global cash or fi nancing from a series of transaction fi nances two LNG which market, and it allows fi nancing without sales transactions, typically involving are contracted to for Ras Gas and ownership risk. In the hydrocarbon four counter-parties. Albaraka Turk British Gas through its own vessels. sector, ownership risk oft en extends to Participation Bank used the structure Maran Nakilat is the fi rst ever Islamic carrying the liability for pollution. to issue non-tradable Sukuk as part of vessel fi nancing transaction for a Greek its regulatory capital structure. BIMB company (co-owned by Qatar’s Nakilat). Honorable Mention: Albaraka Turk Holdings incorporated Tawarruq into The fi ve-year deal has an extension Participation Bank; BIMB Holdings; its shareholder buyout. Malaysia’s option for a further fi ve years which also Cagamas; and Perbadanan Tabung Cagamas and Perbadanan Tabung allows for re-sizing of the facility. Pendidikan Tinggi Nasional. Pendidikan Tinggi Nasional also achieved successful large-scale One reason that Tawarruq is oft en Tawarruq transactions. preferred for shipping fi nance is that it

IFN Deals of the Year 2013: Results Continued from page 10

STRUCTURED FINANCE: Malaysian Building Society (MBSB) Deal Size: RM495 million (US$150.59 million) Arranger: RHB Investment Bank Lawyers: Kadir, Andri & Partners for the arranger Shariah Advisors: Amanie Advisors Rating: RAM: ‘AA1’ (fi rst tranche) Date: 24th December 2013 Although a number of clever structures unlike many covered deals in the MENA direct claim against MBSB. The pool of were nominated for the Structured region, the investors are legally able to receivables transferred to the guarantor Finance Deal of the Year, the MBSB deal access the ‘cover’ to satisfy their claims. SPV give a second avenue to cover the is the fi rst covered Sukuk transaction Most earlier deals in the MENA region fi nancial claims of the Sukukholders in the Islamic housing fi nance sector. are asset-light and the Sukukholders from a dedicated pool of identifi ed Tamweel and others have issued cannot make claims on the underliers. Islamic personal fi nancing receivables asset-backed securities. But, with the which are ring fenced in the bankruptcy growing Basel III challenges, many MBSB is a key provider of personal remote SPV. Islamic banks operate in jurisdictions fi nancing facilities for civil servants in in which securitization is not easy, not Malaysia. The institution is seen as very Honorable Mention: International Islamic possible. Leave it to the Malaysians to secure as almost all repayments (99%) Liquidity Management Corporation; pioneer a model for which is replicable collected through salary-deduction Univers Acier; Telekom Malaysia; and KDU and may be adjusted to other markets. schemes. Funding in this deal is University College. A key distinction in this deal is that provided through Tawarruq creating a

TRADE FINANCE: Mobily Deal Size: US$645.85 million Arrangers: Crédit Agricole Corporate and Investment Bank and Deutsche Bank, London Branch. Lawyers: Latham & Watkins for Mobily and Allen & Overy for the arrangers Rating: Unrated Date: August 2013 Refer to explanation under Murabahah Deal Honorable Mention: Trading Corporation Equity Partners; and Bahra Advanced Cable of the Year on page 9. of Pakistan; Turk-Eximbank; Abu Dhabi Manufacturing Co.

WAKALAH: Astra Sedaya Finance Deal Size: US$50 million Arrangers: Bank of Tokyo-Mitsubishi UFJ (Malaysia), BNP Paribas Malaysia, CIMB Bank, Singapore Branch, HSBC Amanah Malaysia and Standard Chartered Saadiq Lawyers: Linklaters (English Legal Counsel), Mochtar Karuwin Komar, (Indonesian Legal Counsel) for the obligor and Bakers & McKenzie. Wong & Leow (English Legal Counsel) Hadiputranto, Hadinoto & Partners (Indonesian Legal Counsel) for the fi nanciers Shariah Advisors: None stated Rating: Unrated Date: 27th November 2013 Although there were many large and Indonesia and the fi rst Islamic fi nancing and leasing contracts of Astra Sedaya well publicized Wakalah deals, Bank deal in Indonesia provided by Japanese Finance. of Tokyo-Mitsubishi UFJ (Malaysia) bank. was an intriguing cross-border deal Honorable Mention: Abu Dhabi Equity allowing 3.5-year tenors (inclusive of six Supporting the auto fi nance business Partners; Al-Mourjan For Electricity months of availability period). The deal, of Astra Internasional, the deal Production Company (Rabigh 2 IPP); availed in Singapore dollars, was the provides a means for participation Emirates Airlines; Ooredoo; and PIA. fi rst syndicated Wakalah fi nancing in in the underlying installment sales

IFN Deals of the Year 2013: Results Continued from page 12

Country Deals: (Please note that for a country/region to be featured in this section a minimum of three recognized transactions are to have been completed in the speciﬁ ed period.)

AFRICA: Osun Sukuk (Nigeria) Deal Size: NGN11.4 billion (US$72.15 million) Lead Arranger: Lotus Capital Co-Arrangers: Chapel Hill Advisory Partners, FBN Capital, Fidelity Securities, FCMB Capital Markets, Greenwich Trust, Lead Capital, Marina Securities, Oceanic Capital Company, PanAfrican Capital, Phoenix Global Capital Market, Skye Financial Services, Stanbic IBTC Capital, Sterling Capital Markets, Uni Capital, Union Capital Markets, Zenith Securities Lawyers: Kola Awodein & Co and FO Fagbohungbe & Co for the issuer and Tope Adebayo for the trustee Shariah Advisors: Professor Dr Monzer Kahf and Professor Muhammad Bashar Rating: Agusto & Co: ‘A’ Date: 10th October 2013 Fulfi llment of the African promise on the strength of the product and the sub-sovereign Sukuk in sub-Saharan is slow. In 2013, only a few African opening of the market, Osun Sukuk is Africa the deal went well despite nominees emerged. ITFC structured a the African Deal of the Year. the challenging regulatory and legal revolving trade facility for Morocco’s framework environment. The Sukuk Univers Acier, freeing cash during The 14.75% fi xed return Sukuk Ijarah were oversubscribed notwithstanding the trade cycle for the Moroccan steel due in 2020 supports the construction their novelty. Lotus Capital rightly maker. The winner of the Mudarabah of 23 high schools, two middle schools takes pride that the deal was completed Deal of the Year, East Delta Electricity and two elementary schools across Osun successfully and effi ciently with Production Company pulled together State. The Sukuk are guaranteed by the Nigerian talent doing the heavy lift ing an innovative syndication during government of Osun State. The deal and no international underwriters or diffi cult times. But, in Nigeria, Lotus won widespread support from the full structuring agents. Capital pulled together the fi rst sub- Nigerian fi nancial market community sovereign issuance applying the new with almost all domestic investment Honorable Mention: East Delta Electricity Nigerian ‘non-interest’ capital markets banks acting as co-underwriters and Production Company (Egypt) and Univers framework. This is also the fi rst sub- almost all banks, conventional and non- Acier (Morocco). Saharan sub-state sovereign deal. Based interest buying the Sukuk. As the fi rst

EUROPE: Sukuk Wakalah Program (Salam III) for European insurance group, FWU Deal Size: US$100 million; the fi rst tranche of the program, US$20 million, has already closed Arranger: European Islamic Investment Bank, Rasmala Group Lawyers: Morgan, Lewis and Bockius (Legal Counsel for Issue, Transaction Structuring Counsel) and Bedell Cristin Guernsey Partnership (Guernsey Counsel to the issue and issuer) Shariah Advisors: Amanie Advisors Rating: Fitch: 'BBB -' Date: 30th October 2013 In a year of ongoing European malaise the FWU-sponsored Sukuk Wakalah to pay commissions to its agents. The and anemic UK growth, the DOTY Salam III stood out as innovative. The deal is highly collateralized by the fl ow was light for the UK and Europe investment-grade sponsor delivered sponsor's underlying Shariah compliant in general. BLME continued their the Sukuk through its subsidiary cash fl ows. niche real estate business with new Atlanticlux, Luxembourg. The fi rst competition. LTH deserves merit for of three tranches was US$20 million Honorable Mention: Somerset Place and facilitating Tabung Haji's leveraging of and closed in October 2013. Two more LTH. UK real estate. tranches are planned. The Sukuk appoint the issuer to invest in the re- Up until now the theme has been Takaful business and its permissible real estate and Tawarruq. As a result, activities. This frees cash for the sponsor

IFN Deals of the Year 2013: Results Continued from page 13

INDONESIA: Golden Agri-Resources Deal Size: RM5 billion (US$1.52 billion) Lead Arranger: RHB Investment Bank Shariah Advisors: SC Malaysia Rating Unrated Date: March 2013 Indonesia had a limited number of Agri is the world’s second-largest palm cross-currency swaps in a volatile nominations for 2013. Golden Agri oil plantation company and the largest environment. was the largest Malaysian ringgit- in Indonesia. The Sukuk program denominated issue by a foreign issuer gives Golden Agri access to US dollar Honorable Mention: Astra Sedaya and in the Malaysian debt market. Golden funding at competitive pricing through Pandu Logistics

KUWAIT: Mohammed Abdul Mohsin Al Kharafi & Sons Co (Al Kharafi ) Deal Size: US$172 million Financier: Dubai Islamic Bank Shariah Advisors: Dar Al Sharia Rating: Unrated Date: April 2013 Kuwait is only now fully emerging the administration building, car park with the Kuwaiti bank only in case of from the fi nancial crisis. Many and fi re station. any outstanding claims under lett er investment companies are refocusing of guarantees and/or due payments their businesses, which is the essence Dubai Islamic Bank, fronted by a under lett er of credit and acceptances of Noor Investment Bank’s exit from Kuwaiti bank, is providing performance or any due payments under funded its investment in Pakistan’s Meezan cover for Al Kharafi during the nine- exposure; and acknowledgement, Bank. Others like A'ayan Leasing and month project period. The guarantees consent and undertaking on the Notice Investment Company have restructured. are covered by ‘escrowing’ of payments of Assignment from the Kuwaiti bank. from the Directorate General of Civil Documenting and validating the Al Kharafi won the project from the Aviation Al Kharafi with a local bank security package was complicated. Directorate General of Civil Aviation in Kuwait; Notice of Assignment to for the Kuwait International Airport transfer project proceeds to Dubai Honorable Mention: Noor Investment Expansion project (Phase II). In this Islamic Bank (Amanat/collection Bank sale of shares in Meezan and A'ayan project, Al Kharafi will be working on account) from the project account Leasing and Investment Company.

MALAYSIA: DanaInfra Nasional Deal Size: RM300 million (US$91.27 million) fi rst tranche Arrangers: AmInvestment Bank, CIMB Investment Bank, Maybank Investment Bank, and RHB Investment Bank Lawyers: Adnan Sundra & Low for the issuer and Mohamed Ridza & Co for the arrangers Shariah Advisors: CIMB Islamic Bank Rating: Unrated, guaranteed by the Government of Malaysia Date: 8th February 2013 fi rst tranche The Malaysian Sukuk market is the the achievements of the other deals, deeper pool of national savings. In light most vibrant and active Sukuk market. DanaInfra’s fi rst ever exchange traded of this achievement, DanaInfra is the As a result, selecting Malaysia’s deal Sukuk successfully created a new asset Malaysian Deal of the Year. of the year is never easy. With deals class for retail investors. By reaching like BIMB Holdings, Malaysia Building beyond institutional investors, high Honorable Mention: BIMB Holdings; Society, S P Setia, and Malaysia net worth individuals, and fi nancial Malaysia Building Society; S P Setia; and Airports Holdings, the competition institutions, DanaInfra’s retail Sukuk Malaysia Airports Holdings. was crowded at the top. As always, promises to bring greater liquidity to the Malaysia breaks new ground, despite Islamic capital markets by tapping the

IFN Deals of the Year 2013: Results Continued from page 13

PAKISTAN: Government of Pakistan Deal Size: PKR43.018 billion (US$402.41 million) Joint Financial Meezan Bank, Dubai Islamic Bank Pakistan, Standard Chartered Bank Pakistan Advisors: Shariah Advisors: State Bank of Pakistan Rating: Domestic sovereign issue Date: March 2013 Many sovereign deals in 2013 were The resultant Sukuk Ijarah issuances issued through State Bank of Pakistan repeats of the same structures used by help to allow the establishment of a auctions. the same issuers. Litt le new ground domestic benchmark. The transaction, was broken. Meezan Bank, Standard which uses Pakistan’s M1 motorway Honorable Mention: Qasim International Chartered Bank Pakistan and Dubai as underlying asset, also serves the Container Terminal; Pakistan International Islamic Bank Pakistan provided needs of the Islamic banking industry Airlines; Siemens Pakistan Engineering advisory services to the Government by enabling them to eﬀ ectively manage Company; and Pakistan Mobile of Pakistan (GoP) to enable it to raise their liquidity with a high quality Telecommunications. funds in a Shariah compliant manner. liquid instruments. The Sukuk are

QATAR: Ooredoo Deal Size: US$1.2 billion issuance from US$2 billion program Arrangers: DBS Bank, Deutsche Bank, HSBC, QInvest and QNB Capital Lawyers: Latham & Watkins for the issuer and Cliff ord Chance for the arrangers Shariah Advisors: HSBC Saudi Arabia Executive Shariah Committ ee; Dr. Hussein Hamid Hassan, Shariah advisor to Deutsche Bank, London Branch; the Shariah supervisory board of QInvest; and the Shariah supervisory board of the Islamic Bank of Asia (a subsidiary of DBS Bank) Rating: Fitch: ‘A+’ Moody’s: ‘A2’ S&P: ‘A’ Date: 13th December 2013 Ooredoo is the security that many hope on the certifi cateholders the right to cooperation and interaction with the will generate more enthusiasm for receive income arising from the sale Qatari telecommunications regulator state-linked and corporate Sukuk in the by Ooredoo to the Trustee of minutes because sale of airtime is a regulated Qatari market. The Reg S deal is listed of airtime on Ooredoo's mobile activity in Qatar. on the Irish Stock Exchange and was telecommunications network and the very well received, being oversubscribed distribution thereof by Ooredoo to The deal was Ooredoo’s fi rst time four times. The Sukuk program its customers. The use of the telecom issuing in the Islamic capital market. utilizes airtime as the underlying airtime minutes instead of property Previously, Ooredee had been a frequent asset. This inaugural issuance was assets, for example, to underpin conventional issuer. through Ooredoo Tamweel, a Cayman the Sukuk, provides Ooredoo the Islands spv wholly-owned by Ooredoo opportunity to use a much larger pool Honorable Mention: Qatar Islamic Bank (the trustee), of US$1.25 billion trust of available assets and thus issue on a and Maran Nakilat Co. certifi cates due 2018. The program regular basis in future. The development utilizes a Manafae structure, conferring of the Sukuk structure also required the

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IFN Deals of the Year 2013: Results Continued from page 14

SAUDI ARABIA: Sadara Chemical Company (as the Project Company) and Sadara Basic Services Company (as issuer of the Sukuk) Deal Size: SAR7.5 billion (US$1.99 billion) Lead Arrangers: AlBilad Investment Company, Alinma Investment Company, Deutsche Securities Saudi Arabia and Riyad Capital Lawyers: Milbank, Tweed, Hadley & McCloy and Allen & Overy for the arrangers Shearman & Sterling (London) and Hatem Abbas Ghazzawi & Co as legal advisors to The Dow Chemical Company White & Case and The Law Offi ces of Dr. Waleed N. Al-Nuwaiser in association with White and Case as legal advisors to Saudi Arabian Oil Company Shariah Advisors: The Joint Shariah Committ ee of Alinma Investment Company and AlBilad Investment Company. DB Shariah Advisers. The Shariah Committ ee of Riyad Capital Rating: Unrated Date: 28th June 2013 Saudi Arabia is increasingly a sprint and Al Marai all provide strong claims asset-rich corporates and real estate to compete with Malaysia in volume for being the Saudi Arabian deal of companies is defi ned. Sadara also must and variety in Islamic capital market the year. But, Sadara grabs the lead do so while managing complex inter- transactions. In 2013, the volumes of by refi ning the SATORP structure and fi nancier issues and export credit agency syndicated deals and Islamic securities applying the anticipated new Sukuk requirements for the overall project. The deals were also robust. Mobily’s rules. With the help of the Sadara tradable Sukuk are listed on Tadawul. Tawarruq facilities from the Finnish Basic Services Company Sukuk, more ECA, Finnvera, and the Swedish ECA, structure is delivered to the Saudi Honorable Mention: GACA; Kemya; Exportkreditnämnden, GACA, Kemya, Arabian market, and a template for Mobily; and Al Marai Company

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IFN Deals of the Year 2013: Results Continued from page 15

TURKEY: Turk Eximbank Deal Size: US$50 million Arrangers: International Islamic Trade Finance Corporation (ITFC) Shariah Advisors: ITFC Rating Unrated Date: 26th June 2013 The Turkish market performed well delivered its two-step Murabahah of exports, via export declaration again in 2013. The participation banks products throughout the IDB’s footprint. forms. The ITFC then sells the goods improved their regulatory capital, and The tool has generally been used on to Turk Eximbank which has the republic returned to the market for import fi nance. With the Turk assignment of the ITFC’s receivables with a successful off ering. A key part of Eximbank, the ITFC applied the concept from exporters. the Turkish success story over the past for export fi nance. 10 years has been trade fi nance. The Honorable Mention: Albaraka Tü rk Katılım ITFC has been playing an important Under the export structure, the Bankası; and Bank Asya. role in the expansion of Islamic trade ITFC purchases the goods from fi nance tools. The ITFC has successfully exporters upon presentation of proof

UAE: Dubai DOF Sukuk (issuing on behalf of the Government of Dubai Deal Size: US$7.5 billion Arrangers: Dubai Islamic Bank, Emirates NBD, HSBC, National Bank of Abu Dhabi and Standard Chartered Bank Co Lead Managers: Al Hilal Bank, Barwa Bank, Commercial Bank International, IDB and Sharjah Islamic Bank Lawyers: Allen & Overy for the arrangers and Latham & Watkins for the issuer. Shariah Advisors: HSBC Amanah Central Shariah Committ ee and the Shariah advisory board of Dubai Islamic Bank, Dar Al Sharia Rating: Unrated Date: 30th January 2013 The markets ended 2012 feeling that of its yield curve and a benchmark of times, a clearly supportive voice from something extraordinary was happening investor conﬁ dence. the market, and a very good way to start in Dubai. Business indicators showed the campaign to establish Dubai as a more than recovery. Yet, concerns The deal was executed swift ly, capital of the Islamic economy. remained about the Emirate itself: delivering att ractive pricing on the would it be able to reposition itself unrated 10-year Reg S Sukuk. This Honorable Mention: Al Noor Hospitals; into an ever bett er position? For the buoyed and continues to support Dubai Islamic Bank; Gulf Marine Services; government of Dubai, other issues were growing conﬁ dence in the emirate. The GEMS Eductaion; and Emirates Airlines. at stake including the establishment transaction was over subscribed by 12

UK: LTH Property Holdings, a wholly owned subsidiary of Lembaga Tabung Haji Deal Size: GBP225 million (US$369.34 million) Arrangers: Maybank Islamic, OCBC Al-Amin Bank and Standard Chartered Saadiq Lawyers: Trowers & Hamlins for the obligor and Baker & McKenzie, Wong & Leow (as to English Law), Walkers (as to Jersey Law) and Wong & Partners (as to Malaysia Law) for the arrangers and fi nanciers Shariah Advisors: Maybank Islamic, OCBC Al-Amin Bank and Standard Chartered Saadiq Rating: Unrated Date: 17th October 2013 For a number of years, Bank of London market with a premium linked In order to leverage two central London and The Middle East (BLME) held Sukuk product. On the one hand, the properties, LTH Property Holdings up the Union Jack fl ag. They return innovation will require more market applied Tawarruq to fund clients’ with the Somerset Place deal which investigation of the concepts applied. investment in two central London is the fi rst redevelopment of an entire On the other hand, the Tabung Haji properties. The facility involves multiple Georgian Grade I listed property. On as sponsor of LTH Property Holdings jurisdictions including Malaysia, Jersey the continent, FWU also led the charge used a tried and true method to (Channel Islands) and the UK. with the second-ever European Sukuk overcome challenges relating to tax and in 2012. In 2013, FWU delivered jurisdiction. Honorable Mention: Somerset Place and more innovation to the market with Atlanticlux Lebensversicherung.

Results of the 2013 IFN Best Banks Poll

Category WINNER RUNNER-UP Best Overall Islamic bank Abu Dhabi Islamic Bank CIMB Islamic Best Central Bank in Promoting Government of Dubai Bank Negara Malaysia Islamic Finance Lanka ORIX Finance - Al- Best Islamic Leasing Provider Gulf International Bank Falaah, Islamic Business Unit Standard Chartered Al Rajhi Banking & Best Islamic Private Bank Saadiq Investment Corporation Al Rajhi Banking & Best Islamic Retail Bank Abu Dhabi Islamic Bank Investment Corporation Most Innovative Islamic Retail Bank Abu Dhabi Islamic Bank CIMB Islamic Best Islamic Trustee/Custodian Deutsche Bank AmanahRaya Trustees Best Private Equity House Abraaj Capital Fajr Capital

And these results, while perhaps not and Best Islamic Bank in Egypt (edging throwing up any major surprises, clearly out Al Baraka Bank Egypt). reaffi rm not only the reassuringly consistent growth of the industry despite The bank has posted an impressive the global economic challenges faced performance in 2013 with total income of by the wider fi nancial industry; but also US$912.7 million and profi t of US$301.3 highlight key themes of cross-border million for the fi rst three quarters. With expansion, global reach and international a focus on international expansion cooperation and collaboration that including core targets of Iraq and the The results are in and, perhaps provide hope and promise for 2014. UK, 2014 looks set to be another exciting unsurprisingly given the att ention and year for one of the brightest stars in encouragement the country has given This year we received 264 nominations, the Middle Eastern Islamic fi nance to Islamic fi nance over the last year, over 100 more than in 2012. Six of fi rmament. UAE institutions have surged ahead the top eight general categories had to claim some of the top awards in nominees well into the double digits, A close competitor to ADIB and fi ghting the contest. However, the impressive while out of 30 country awards none a tight batt le to come runner-up in two of array of categories and countries had fewer nominees than three and the the top categories of Best Overall Islamic and the number of nominees in each majority saw between fi ve and 10 banks Bank and Most Innovative Islamic Bank, closely fought contest demonstrates competing for the award. CIMB Islamic also cemented a stellar unequivocally the exceptional growth performance in 2013. that the industry has enjoyed over the One of the biggest winners of the year previous year: with a strong theme of was Abu Dhabi Islamic Bank (ADIB), While its position as one of Malaysia’s cross-border and international activity. which came out top in a hard-fought leading Islamic groups is longstanding, contest with CIMB Islamic to achieve the group has extended its reach and Covering all major and emerging Islamic Best Overall Islamic Bank to build on its established its position across the key finance markets across 38 categories, previous win. ADIB also came a close markets of Southeast Asia to cement the IFN Best Banks Poll received an second in the category of Best Islamic its position as one of the region’s overwhelming response from industry Retail Bank, which it also won in 2012, powerhouses in terms of both retail and players across the globe: including new but was pipped at the post by Saudi institutional banking, with a particular and emerging markets such as Australia, Arabia’s Al-Rajhi Bank. nod to its sterling asset management Syria, the UK, Lebanon, Iran and performance. Kenya as well as the more established However, the bank came top for Most jurisdictions of the GCC and Southeast Innovative Islamic Retail Bank (beating Demonstrating its unrivalled strength Asia. This year saw a record number of last year’s winner Bank Muamalat in the ASEAN region, CIMB Islamic this 13,480 votes (over 1,000 more than in Indonesia as well as runner-up CIMB year scored the full hat-trick: not only 2012) and aft er a comprehensive process Islamic) as well as taking home the prize reclaiming the award for Best Islamic of due diligence 11,117 of these went for Best Islamic Bank in the UAE (in a towards the fi nal results. close contest with Dubai Islamic Bank) continued...

Continued

Bank in Malaysia from 2012 winner Bank Singapore over the local IBA as well as approach over the last decade, and is Islam Malaysia but achieving Best Islamic taking the Thailand award from leading now known as one of the leading private Bank in Singapore and Best Islamic Bank domestic player and last year’s winner, equity houses both in the Middle East in Thailand; as well as coming a close the Islamic Bank of Thailand. and globally. With a focus on growth second to Bank Muamalat Indonesia for markets, Abraaj should be applauded Best Islamic Bank in Indonesia. In one of the sturdiest strongholds of as a pioneer, leading the way where Islamic fi nance however, Saudi Arabia, others only follow and combining The Singapore win is of particular the domestic banks still retain their deep experience with innovation and interest, with CIMB Islamic winning out dominance. Al Rajhi Bank, one of the adventure. over the incumbent Islamic Bank of Asia largest Shariah compliant banks in the (IBA), who have won the award every world with assets of US$71.2 billion, Its network of 25 offi ces over six regions year since inception: demonstrating this year took home not only the award gives it the strength and capacity to CIMB’s capital market infl uence as well for Best Islamic Bank in Saudi Arabia provide both a local and global approach, as its strong entry into the Singaporean (winning out over another domestic and its most recent win highlights the retail market. giant, National Commercial Bank, to potential the group holds for the next build on its 2012 success) but also won generation of Islamic equity investment. The group identifi ed Indonesia and the category of Best Islamic Retail Bank Singapore as focus markets as long ago in one of the hardest-fought batt les of the We fi nish with one of the biggest as 2010 and eff orts to establish these year with the most nominees of the entire awards of the poll: and one of the most markets have clearly been successful: poll. infl uential. It will come as no surprise with profi t before tax from its Indonesia to our readers that following a year operations increasing by 24% in the fi rst Another tight fi ght came in the category of extraordinary progress, impressive nine months of 2013 and total profi t of Best Islamic Private Bank, in which goals and exceptional dedication to contribution from Singapore growing by Al Rajhi came runner-up. However, the industry, the Government of Dubai 28% to RM160 million (US$48.67 million). Standard Chartered Saadiq eventually takes the title of Best Central Bank in beat out the other 14 competitors, Promoting Islamic Finance (beating last Also showcasing the strength and including last year’s winner National year’s winner Bank Indonesia as well as success that a strong global footprint Development Bank (now ADIB Egypt) to runner-up Bank Negara Malaysia). can bring, the Bahrain-based Al Baraka take home the prize. Bank is another institution that fl exed its In 2013 the emirate confi rmed its international muscles in 2013. Renowned Best Islamic Leasing Provider saw a win ambition to become a major player in the for its extensive geographical presence, for Bahrain-based Gulf International market but, unlike many new entrants, the group has subsidiary banking units Bank (GIB), with the runner-up being Al- its authorities have placed their money and offi ces in 15 countries with over 450 Falaah, the Islamic unit of Lanka ORIX fi rmly where their mouth is: making branches. Finance. real strides forward and taking material action to actively develop the Islamic As of September 2013 the group held Deutsche Bank won out over Malaysia’s economy: starting with the launch of assets of US$19.89 billion, with total AmanahRaya Trustees to take home the the Dubai Center for Islamic Banking income of US$206.21 million and net title of Best Islamic Trustee/Custodian for and Finance in July 2013 and continuing profi ts of US$57.21 million. This year Al the fourth consecutive year, based on its with the proposal for a center for Islamic Baraka took home Best Islamic Bank in commitment to delivering world-class corporate governance to be set up in Bahrain, Best Islamic Bank in Lebanon solutions to its impressive array of global 2014. and Best Islamic Bank in Sudan (all of clients. As one of the most experienced which it won in 2012). Its subsidiaries specialists in the administration of And not only has Dubai’s commitment also came runner-up for Best Islamic fi nancial instruments, the bank’s trust to the industry made an impact within Bank in Egypt, Pakistan, Syria and and securities services can be relied the Muslim world. Its highly publicized Turkey. upon to provide support, leadership and action plan has also had an undeniable excellence. eff ect on other markets around the world The Bahrain win was a particularly who have been toying with the idea: and interesting achievement, given that In the category of Best Islamic Private subsequent to the January announcement despite technically being a Bahrain bank Equity House, the UAE once again of its intention to promote Dubai as an Al Baraka is headquartered in Saudi comes to the fore with Dubai-based Islamic fi nance center both the UK and Arabia and positions itself as a global Abraaj Capital taking the crown, closely Hong Kong also took the plunge. Islamic banking group. This highlights followed by runner-up Fajr Capital another theme this year: of local banks (also based in Dubai), superseding last The Government of Dubai must losing votes to ‘outsiders’ or foreign year’s winner Qatar First Investment therefore be congratulated not only for banks. Bank. Abraaj Capital has taken full its own admirable eff orts, but also for its advantage of Dubai’s focus on building invaluable role as a catalyst stimulating While Al Baraka won in Lebanon and its Islamic economy to deliver a sterling wider global participation. — LM Sudan, Egypt was taken by UAE-based performance over the past year. The ADIB and Malaysia’s CIMB Islamic won group has developed its own unique

AUSTRALIA: Muslim BRUNEI: Bank Islam Brunei INDONESIA: Bank Muamalat Community Cooperative Australia Darussalam Indonesia (BMI) (MCCA) Runner-up: Maybank Runner-up: CIMB Niaga Syariah Runner-up: KFH Australia Bank Islam Brunei Darussalam is the Bank Muamalat Indonesia was founded MCCA has been in business since 1989. largest Islamic bank in Brunei, and in 1991, endorsed by the Indonesian Twenty fi ve years on, the cooperative provides consumer and corporate government, and was the fi rst has proven itself as a leading provider banking services to the country’s institution to off er Islamic banking in of Islamic fi nancial and wealth population. the country. The bank has continued to management services to the country’s play an innovative and groundbreaking Muslims. Although the institution The bank, which has the largest role in the industry, with over 400 currently only has a 2% market network of ATMs across the country, branches across 33 provinces as well penetration rate, it is looking to expand was formed in 2005 through a merger as over 3,800 online post offi ce outlets its services from being a mortgage of the Islamic Bank of Brunei and the off ering wide-ranging access to provider to extending a wider suite of Islamic Development Bank of Brunei. fi nancial services for all segments of Islamic banking business to its existing society. Shareholders include the IDB, clientele and potential customers. The bank’s total assets stood at US$4.8 Boubyan Bank Kuwait, and SEDCO billion as at 2011, and is committ ed to Group. The bank holds an ‘AA Shariah growing in tandem with the country’s Quality Rating’ from IIRA Bahrain and BAHRAIN: Al Baraka Islamic Bank Vision 2035, to achieve a developed Fitch Ratings affi rmed a rating of 'A Runner-up: Bahrain Islamic Bank nation status. (idn)' in 2010. In 2009 BMI launched its fi rst branch in Kuala Lumpur, Incorporated in Bahrain 30 years ago becoming the fi rst foreign Islamic bank in 1984, Al Baraka Islamic Bank has EGYPT: Abu Dhabi Islamic Bank to open a branch under Malaysia’s pioneered the development of Islamic (Egypt) International Islamic Banking (IIB) banking in the kingdom. Rated ‘BBB-‘ license. by S&P, it operates as a retail and Runner-up: Al Baraka Islamic Bank investment Islamic bank and currently Egypt operates six branches in the kingdom. Founded in 1980 as the National Bank JAPAN: Bank of Tokyo Mitsubishi Despite being indirectly aff ected by for Development, Abu Dhabi Islamic UFJ the harsh operating environment in Bank (Egypt) is one of the largest Bahrain stemming from political and Islamic banks in the region with 19 Runner-up: Sumitomo-Mitsui economic uncertainty since 2011, the subsidiaries operating across Egypt and Banking Corporation bank has managed to record double the UAE. Based in Cairo, the bank has a This was a new category for this year, digit growth across its banking assets nationwide network across Egypt of 69 looking at the best Japanese bank and profi tability. branches, 39 microfi nance units and 67 off ering Islamic services rather than ATMs across 21 governorates. at the best Islamic bank in Japan. The 2013 winner, Bank of Tokyo Mitsubishi BANGLADESH: Islami Bank In 2007 Abu Dhabi Islamic Bank UFJ, was the runaway winner in a Bangladesh acquired 49% of the National Bank fi eld of four. The bank is the largest Runner-up: Al Arafah Islamic Bank for Development (NBD), which it in Japan and serves as the core retail subsequently restructured to comply and banking arm of the Mitsubishi UFJ Islami Bank Bangladesh, launched in with Shariah. Financial Group. The bank has focused 1983, is a pioneer of Islamic banking in on building up its foreign operations, Bangladesh. It has 37% local ownership Since 2007 the bank’s paid-up capital and saw overseas corporate lending and 63% foreign shareholders including has increased seven-fold from around increase by 40% in 2011 alone. the IDB, JPMorgan, Dubai Islamic Bank US$40.1 million to over US$286 million and Kuwait Finance House. The fi rm by the end of 2010. Bank of Tokyo Mitsubishi UFJ is the largest private banking network Malaysia was the fi rst Japanese bank in Bangladesh with 285 branches and In April 2013 the bank was rebranded to off er Islamic services, entering the over 11,000 staff . The bank claims to be from NBD to Abu Dhabi Islamic Bank industry in 2008 with its International the fi rst Shariah-based bank in South (Egypt) As of September 2013 the bank Currency Business Unit aiming to Asia, and operates both consumer, held US$2.18 billion in assets, up from att ract Japanese business transactions corporate, investment management US$2.01 billion in 2012. to Malaysia. The bank is active in the and international divisions. As of Islamic capital markets, including a the 31st December 2012 the bank had The bank has built an exceptional recent syndicated Istisnah and Ijarah US$526.34 million in equity. In the fi rst foundation based on its strength in fi nancing to a major producer of LNG three quarters of 2013 the bank saw net multiple core markets across personal vessels based in Brunei, and is the fi rst profi t before tax of US$87.2 million, banking, microfi nance, wholesale Japanese bank to have an in-house down 37% from US$137.4 million in banking and treasury, and remains Shariah committ ee. the same period the previous year but one of the leading lights of the North a continued recovery from the US$17.3 African Islamic fi nance industry. million low the bank saw in 2011; and currently holds total assets of US$6.59 billion.

IRAN: Bank Melli Iran KENYA: Gulf African Bank MALAYSIA: CIMB Islamic Runner-up: Bank Al Jazira (Jeddah) Runner-up: First Community Bank Runner-up: Bank Muamalat Malaysia Bank Melli Iran currently has assets Gulf African Bank is the fi rst and CIMB Group is Malaysia’s second- worth US$67.14 billion, ranking largest Shariah compliant bank in largest banking group, and CIMB it among the top Islamic fi nancial Kenya, and one of the fastest-growing Islamic is one of the most infl uential institutions in the world, by Shariah banks in the country. Launched in 2006 Islamic institutions in the Southeast compliant assets. The bank is also and starting operations in 2008 under Asian region. A full service Islamic actively involved in the country’s the country’s fi rst full commercial fi nancial solutions provider, the bank development plans and is currently banking license for an Islamic bank, off ers investment banking, consumer one of the largest fi nanciers to the the bank has total assets of over banking and asset management government. The 80-year old bank US$112 million and as of 2012 held services catering to fi nancial has over 3,300 branches in Iran and shareholder’s funds of US$31 million. institutions, governments, corporations employs over 43,000 personnel. The The bank has future plans to expand and individuals, and has cemented bank has grown to become the largest into Uganda and Tanzania. Asad its position as an industry leader and bank in Iran in terms of assets, deposits Ahmed, CEO of Gulf African Bank global presence. and credit facilities. in Kenya is optimistic on the bank’s future, stating: “We are proud that aft er only four years in operation, the OMAN: Bank Nizwa JORDAN: Jordan Dubai Islamic bank has achieved tremendous growth Runner-up: BankMuscat Bank and profi tability and contributed well Bank Nizwa is Oman’s fi rst dedicated to the economy of this country. Gulf Runner-up: Jordan Islamic Bank Islamic bank and has demonstrated African Bank was the fi rst Islamic Bank Jordan Dubai Islamic Bank is a an exceptional growth story since to be set up in East Africa and today, is subsidiary of Dubai Islamic Bank, one its launch in January 2013. The bank the largest Islamic bank in this region. of the largest Shariah compliant banks provides a full range of banking Gulf African Bank has been established in the UAE. Islamic banks hold over solutions to individuals, small and to provide a full suite of Shariah 12% of the total Jordanian banking medium size enterprises, corporations compliant products and services to its sector and Jordan Dubai Islamic Bank and government institutions. It customers in Kenya and beyond.” is a key player, opening its 15 branch in currently operates three branches August 2013. The bank was established with an extensive expansion program in 2010 and has grown rapidly and LEBANON: Al Baraka Lebanon planned for 2014 as well as a signifi cant off ers a variety of predominantly investment in technology. As of the Runner-up: Arab Finance House retail services to cater to the growing fi rst half of 2013 total assets reached domestic demand: including personal Al Baraka Bank Lebanon was US$440.2 million, an impressive Murabahah fi nance, Ijarah home founded in 1991 and operated under achievement in just six months. fi nance, savings accounts and online a commercial banking license until banking. In 2012 the bank’s total assets 2004 when an Islamic Banking Law grew by 35.6% to reach US$3.1 million, was instituted and the bank obtained QATAR: Qatar Islamic Bank (QIB) with a promising future of sustainable an Islamic banking license. An Islamic Runner-up: Barwa Bank banking pioneer in the country, the profi tability and an impressive capital Qatar Islamic Bank was established bank’s activities comprise of retail and adequacy ratio of 43%. in 1982, making it the fi rst Islamic commercial banking in accordance with fi nancial institution in Qatar. Since Shariah principles, and currently has then, the bank has emerged as a force KUWAIT: Kuwait Finance House seven branches across the country. As in the local and international markets, of September 2013 the bank held total Runner-up: Bank Boubyan and today, the bank plays a leading assets of US$19.88 billion and total net Kuwait Finance House was the fi rst role in developing competitive and income of US$57.2 million. Islamic bank to be established in innovative Islamic fi nancial products Kuwait in 1977. Since its inception, and services worldwide. the bank has grown into a robust SAUDI ARABIA: Al Rajhi Bank banking and fi nancial institution, QIB currently holds 37% of the Islamic Runner-up: National Commercial with a presence in Australia, Bahrain banking market in Qatar, and an Bank and Malaysia. The bank currently overall market share of 11% in the provides a diverse suite of Shariah Al Rajhi Bank is Saudi Arabia’s largest banking sector as a whole. This makes compliant products and services private bank by assets, worth US$59 QIB the biggest Shariah compliant covering banking, real estate, trade billion. The bank, which has a fi rm bank in Qatar and one of the top fi ve fi nance, investment portfolios, as foothold in Saudi Arabia and in globally. For the past 30 years, QIB well as corporate, commercial and international markets such as Malaysia has played a pivotal role in Qatar’s retail fi nancing. In 2012 the bank held and Jordan, is continuously looking to development and growth. Backed US$51.9 billion in total assets and saw expand its retail and corporate banking by a dedicated team, the bank has revenues of US$3.29 billion. suites, and is also actively involved in successfully established a foothold in the market as a lead arranger for some the UK, Malaysia and Lebanon. of the landmark deals in the industry.

PAKISTAN: Meezan Bank SRI LANKA: Amana Bank SYRIA: Syrian International Runner-up: Al Baraka Islamic Bank Runner-up: Lanka ORIX Finance — Islamic Bank In one of the most strongly contested Al-Falaah, Islamic Business Unit Runner-up: AlBaraka Syria Bank categories of the awards, Meezan Bank The bank, which is a pioneer in the Syrian International Islamic bank wrestled the top Pakistani position country’s Islamic fi nance sector has was established as a Syrian private from 2012 winners Al Baraka Islamic been instrumental in initiating changes anonymous joint stock company Bank Pakistan. The bank was launched to the Banking Act 2005 to incorporate under a strategic partnership between in 2002 and is the fi rst and largest Islamic banking. Since its establishment the private sectors in the Syrian Arab Islamic commercial bank in Pakistan, in 1997, the bank became the fi rst Republic and the State of Qatar. In celebrating its 10-year anniversary commercial bank to receive an Islamic 2006, the Syrian cabinet approved the in 2012. Key shareholders include banking license in August 2011 and license to launch SIIB under Decree No. the IDB and Kuwait’s Noor Financial has been successful in bringing in a 35 (2005). The bank’s launch was led by Investment Co. It operates a branch substantial amount of foreign equity Qatar International Islamic Bank and is network of over 300 across 99 cities. As investments into the country’s nascent considered the largest private bank in of the third quarter of 2013 the bank Islamic banking sector despite the the country in terms of paid capital and held total assets of US$2.9 billion and global fi nancial crisis. number of shareholders. saw deposits increase by 16% and net profi t grow by 8%. SUDAN: Al Baraka Bank Sudan THAILAND: CIMB Islamic Runner-up: Al Salam Bank Runner-up: Islamic Bank of Thailand PALESTINE: Palestine Islamic Bank Al Baraka Bank Sudan was established (See Malaysia) in 1984 and its activities comprise retail, Runner-up: Arab Islamic Bank corporate, commercial and investment Palestine Islamic Bank was established banking. The bank’s operations UK: Bank of London and The as a joint venture public limited currently span 25 branches. Middle East (BLME) institution and received its Islamic Runner-up: Gatehouse Bank banking license from the Palestinian Known for its active involvement in Monetary Authority in 1997. In 2012, UAE: Abu Dhabi Islamic Bank the real estate sector, as well as its the bank recorded a surge in profi ts (ADIB) structuring expertise and treasury by 268.4% to US$5.37 million, despite Runner-up: Dubai Islamic Bank products in the UK, the Bank of a continuously uncertain political and Abu Dhabi Islamic Bank swept the London & The Middle East has economic environment. The bank has board this year winning some of the continued to persevere despite the 15 branches across the country. biggest categories including Best challenging economic climate in Overall Islamic Bank as well as Best Europe, and is expected to continue on SINGAPORE: CIMB Islamic Bank in the UAE. The bank in 2013 a positive run as demand for Islamic cemented its position as a major issuer real estate investment solutions grow Runner-up: Islamic Bank of Asia in the Islamic capital markets following in the UK. (See Malaysia) its innovative Tier-1 perpetual Sukuk issuance in 2012. The bank also has a property advisory service which was launched in 2012 to South Africa: Absa Islamic Bank The bank is also expanding its provide its private clients support in Runner-up: Al Baraka Bank network across Abu Dhabi and the sourcing and acquiring property. The Middle East, with four subsidiaries Absa Group, listed on the JSE, is one bank saw total operating income of under its patronage including the of South Africa’s largest fi nancial US$41.5 million for the fi rst six months Abu Dhabi Islamic Bank (Egypt), services groups. Absa is a subsidiary of 2013, and as of June 2013 held total Burooj Properties, ADIB Securities of Barclays Bank, which owns assets of US$1.86 billion. In 2013 the and recruitment consultancy Kawader 55.5%. The bank off ers a complete bank had an exposure of around 28% to Services; and is focusing on Iraq and range of retail, business, corporate real estate and a 57% concentration on the UK as key growth areas for the and investment banking, insurance the UK. future. and wealth management products and services. The group’s business Established in 1997, the bank is 29% is conducted primarily in South owned by the ruling family of Abu Have you joined Africa. It also has equity holdings in Dhabi and the Abu Dhabi Investment banks in Mozambique and Tanzania, Authority. For the nine months ending representative offi ces in Namibia and September 2013 the bank saw total Nigeria and bancassurance operations income of US$912.7 million, and profi t in Botswana and Mozambique. At the of US$301.3 million. As of September 31st December 2012, the group had the bank holds assets of approximately assets of US$75.98 billion, 10.9 million US$26.23 billion. our facebook page? customers and over 33,000 employees.

TURKEY: Turkiye Finans Katilim US: Lariba American Finance YEMEN: Islamic Bank of Yemen Bankasi House Runner-up: Saba Islamic Bank Runner-up: Al Baraka Turk Katilim Runner-up: Devon Bank Following internal political turmoil Bankasi Lariba is the oldest community-owned, in Yemen in 2011, the Islamic Bank of Turkiye Finans Katilim Bankasi was Shariah compliant fi nance company Yemen, along with other Islamic banks selected as the best participation bank in the US, serving communities in the country were directly aff ected in Turkey due to the bank’s growing across the country since 1987. The by the unrest. The bank, which came reach across the country. The bank, company has been recognized by, under direct rocket att ack, saw up to which is majority-owned by Saudi and has collaborated with the Fannie 80% of its banking activities paralyzed. Arabia’s biggest lender, National Mae organization, the largest home However, some banks from the GCC Commercial Bank, charted a capital mortgage company in America and the had pledged their support towards adequacy ratio of 14.24% last year; world for its Riba-free fi nancing model. rebuilding the bank’s infrastructure. higher than a majority of the other participation banks.

Best Islamic Bank by Country

INDIAN SUBCONTINENT EUROPE Bangladesh — Islamic Bank Bangladesh Turkey — Turkiye Finans Katilim Bankasi Pakistan — Meezan Bank UK — Bank of London & The Middle East Sri Lanka — Amana Bank

THE AMERICAS US — Lariba

ASIA PACIFIC AFRICA Australia — Muslim Egypt — ADIB (Egypt) Community Co- Kenya — Gulf African Bank Operative Australia Sudan — Al Baraka Bank Sudan Japan — Bank of Tokyo South Africa — Absa Islamic Bank Mitsubishi UFJ

MIDDLE EAST Bahrain — Al Baraka Islamic Bank Iran — Bank Melli Iran Jordan — Jordan Dubai Islamic Bank Kuwait — Kuwait Finance House Lebanon — Al Baraka Lebanon Oman — Bank Nizwa Palestine — Palestine Islamic Bank Qatar — Qatar Islamic Bank SOUTHEAST ASIA Saudi Arabia — Al Rajhi Bank Brunei — Bank Islam Brunei Darussalam Syria — Syrian International Islamic Bank Indonesia — Bank Muamalat Indonesia UAE — Abu Dhabi Islamic Bank Malaysia — CIMB Islamic Bank Yemen — Islamic Bank of Yemen Singapore — CIMB Islamic Thailand — CIMB BOLD Same winner as 2012 NOT BOLD New winner ITALIC New entry

Commission Malaysia (SC). With a DEALS tenor of up to 22 years, the facility will Not just countries be established via the fi rm’s subsidiary Boustead to issue EKVE and will be used to fund the MALAYSIA: Boustead Holdings, parent East Klang Valley Expressway in Kuala company of Islamic plantation-based Al Lumpur. IrAq Hadharah Boustead REIT, has announced the issue of a RM1.2 billion (US$368.12 SABB closes deal LuxemBourg million) Sukuk. The fi rst tranche of the junior Sukuk worth RM683 million SAUDI ARABIA: Saudi British Bank MoroCco ,, (US$209.53 million) was reported to be (SABB) has concluded a seven-year issued to institutional investors by the capital-boosting Sukuk sale worth SAR1.5 ThailanD m m end of 2013. RM650 million (US$199.4 billion (US$399.92 million). Priced at 1.4% million) of the fi rst tranche will be used over six-month SAIBOR, the paper is IrEland to take Al-Hadharah Boustead REIT redeemable aft er fi ve years. AFghanistan private. Bank Rakyat’s sophomore SinGapore Affi n Investment Bank is the principal issuance adviser, lead arranger and lead manager MALAYSIA: Islamic cooperative CHina for the facility, while United Overseas fi nancial institution, Bank Rakyat, has Bank Malaysia is a joint lead manager for BahraIn ,,,,, launched its second Sukuk off ering, the issuance. worth RM500 million (US$151.84 million) DJibouti under the bank’s proposed Islamic CBB Sukuk fully subscribed medium-term notes program worth up to PaKistan BAHRAIN: The Central Bank of Bahrain RM9 billion (US$2.73 billion) in nominal (CBB)’s monthly Sukuk Ijarah issuance value. The Musharakah facility will be AustraLia ... worth BHD20 million (US$52.79 million) issued in three and fi ve-year tranches has been fully subscribed. The 182-day of RM200 million (US$60.74 million) TurkMenistan facility carries an expected return of and RM300 million (US$91.12 million), 1.15% and will mature on the 19th June with a yearly return of 4.3% and 4.45% GermaNy ..... 2014. respectively. Issued via Imtiaz Sukuk II, CrOatia proceeds from the off ering will be used The bank’s monthly Sukuk Salam to fund the bank’s working capital and JaPan issuance worth BHD36 million (US$94.48 general corporate purposes. million) has also been oversubscribed Qatar by 101%. The 91-day facility carries an CBB Sukuk oversubscribed expected return of 1% and will mature on FRance BAHRAIN: The Central Bank of Bahrain the 26th March 2014. (CBB)’s monthly Sukuk Salam issuance IndoneSia .... worth BHD36 million (US$94.48 million) 1MDB second Sukuk? has been oversubscribed by 101%. The SwiTzerland MALAYSIA: Sovereign wealth fund, 91-day facility carries an expected return 1Malaysia Development (1MDB), is of 1% and will mature on the 26th March TUrkey said to be considering a RM1.5 billion 2014. (US$460.16 million) Sukuk sale to fund MoldoVa .. the relocation of an air force base in Kuala Dar Al Arkan buys back Lumpur, according to Bloomberg. KuWait SAUDI ARABIA: Dar Al Arkan Real Estate Development Company has MeXico SC grants approval reacquired 87%, or SAR650 million MALAYSIA: Construction fi rm Ahmad (US$173.29 million), of its SAR750 million MalaYsia Zaki Resources’ proposed RM1 billion (US$200 million) Sukuk in line with its (US$306.77 million) Sukuk Murabahah BraZil has been approved by Securities continued These are some of the countries we DEAL TRACKER Full Deal Tracker on page 49 have subscribers ISSUER ISSUING SIZE (US$) DATE CURRENCY ANNOUNCED Government of Luxembourg EUR 272.08 million 7th January 2014 Contact us now for a free trial…… Government of Oman OMR 518.12 million 6th January 2014 Musfaizal Mustafa Vallianz Capital US$ 500 million 26th December 2013 Subscriptions Director Bank Asya US$ 500 million 23rd December 2013 [email protected] Ahmad Zaki Resources RM 304.19 million 19th December 2013 Tel: +603 2162 7800 x 24

© 23 8th January 2014 NEWS continued... year facility is worth RM18 million Triple ‘A’ all the way as IDB liabilities management strategy. The (US$5.48 million). continues its financing repurchased Sukuk had been terminated schemes with the remaining SAR100 million Pakistani Sukuk auction (US$26.66 million) due to mature on the PAKISTAN: The Pakistani federal SAUDI ARABIA: The IDB’s long-term 15th April 2014. government plans to auction Sukuk and short-term credit ratings have been worth up to PKR90 billion (US$847.06 reaffi rmed by three leading international Below Cagamas’ average million) this month (January) to fi nance rating agencies. The Islamic fi nancial the repair and maintenance of the Jinnah institution was reaffi rmed at: ‘AAA, MALAYSIA: National mortgage A-1+Stable’ by S&P; ‘AAA, F-1+Stable’ corporation Cagamas was reported to be International Airport Karachi and Pindi Bhatian Motorway. by Fitch; and ‘Aaa, P-1 Stable’ by planning to issue its fi nal Sukuk of 2013 Moody’s. to the tune of RM500 million (US$151.37 Sentral 384 due million), bringing the fi rm’s total issuance According to the IDB, it is currently for 2013 to RM9.9 billion (US$2.99 MALAYSIA: Sentral 384’s semi-annual the highest-rated institution in the billion). Responses for the three-month profi t payment on its RM200 million Islamic fi nance sphere as well as among paper fell below Cagamas’ average (US$60.79 million) Islamic medium-term international multilateral development subscription rate due to uncertain market notes program was due and payable on banks. conditions and increased competition the 3rd January 2014. from other banking products, said Rafi za The stable triple ‘A’ ratings are Ghazali, the relief CEO of Cagamas. SEC names arrangers butt ressed by its strong fi nancial profi le, the relevance of its policies, continual Amana’s IPO fully subscribed SAUDI ARABIA: Saudi Electricity Company (SEC) has selected HSBC’s shareholder support for successive SRI LANKA: Islamic fi nancier Amana Saudi Arabian unit and Banque Saudi capital increases and its prudential Bank’s IPO has been fully subscribed. Fransi to arrange the fi rm’s upcoming fi nancial risk management policies. The bank off ered 214.3 million shares riyal-denominated Sukuk off ering, which at LKR7 (US$0.05) apiece, with an is slated to be sold to investors between In pursuit of its objectives to foster option of issuing a further 71.5 million the 9th January and the 27th February. the economic and social progress of ordinary shares. Proceeds from the IPO SEC is also looking to issue a dollar- its member countries and Muslim will be used to meet the minimal capital denominated Sukuk this year via HSBC, communities in non-member countries, requirement of LKR4 billion (US$30.56 Deutsche Bank and JPMorgan Chase. the multilateral development bank has million) set by the central bank. approved a total of US$285.4 million WCE makes foray for the fi nancing of new projects this Vallianz Sukuk year. The fi nancing covers infrastructure MALAYSIA: West Coast Expressway developments in Saudi Arabia, Senegal, SINGAPORE: Vessel and equipment (WCE) plans to off er Sukuk worth up to Mali, Kyrgyzstan, Uzbekistan and Togo. owning company Vallianz has RM1.5 billion (US$456.29 million) with established Vallianz Capital, an SPV a minimum tenor of 10 years in the fi rst Funding approvals also include for the purpose of issuing Sukuk of up quarter, according to reports. Proceeds contributions to educational plans to US$500 million. Proceeds from the raised will be utilized to fund the in Bosnia Herzegovina, Guyana, Islamic trust certifi cate sale will be used construction of a highway in Peninsular Thailand and the US, under IDB’s Waqf towards replenishing the Singapore- Malaysia. RHB Investment Bank is the Fund. A specifi c sum is also allocated listed company’s working capital and for deal’s mandated sole arranger. its refi nancing needs. Vallianz’ biggest to countries such as Chad, Mali, Mozambique, Niger, Nigeria and Yemen shareholder, Swiber Holdings, in August, GEMS Sukuk up debut a SG$150 million Sukuk tranche to assist in the prevention and control of as part of its US$500 million Islamic debt UAE: Private school operator GEMS malaria. program. Education’s debut hybrid Sukuk of US$200 million rose 106.78 US cents Having announced its plans to tap the Intention to issue Sukuk on the dollar since its off ering last Middle East Sukuk market in November November, according to data from last year, the IDB is seeking to list a TURKEY: Bank Asya announced its Bloomberg, while corporate Sukuk in the Sukuk program worth AED37 billion application to issue Sukuk worth up to GCC dropped 2bps to 92.56, according to (US$10.07 billion) on NASDAQ Dubai. US$500 million to the Capital Markets HSBC/NASDAQ Dubai indexes. Board via a statement to the Istanbul The international fi nancial institution Stock Exchange in December 2013. Luxembourg’s Sukuk plans has mandated the International Shariah Research Academy, SABIC Chair for KDU’s sophomore issuance LUXEMBOURG: It has been reported that the Luxembourg government is Islamic Financial Markets from Imam MALAYSIA: Real estate developer looking to issue a sovereign Sukuk Mohammad bin Saud University, Paramount Corp has issued the second following the introduction of a and Holland & Knight to develop a tranche of its Sukuk program via government bill to bring up to EUR200 Musharakah-based Sukuk structure. its wholly-owned subsidiary KDU million (US$272.08 million)-worth of Discussions thereof are expected to University College. Part of a RM350 notes in euros or dollars. commence within the fi rst quarter of the million (US$106.48 million), the seven- year.

to complete in 2017. The minister also Dubai Islamic Bank increases AFRICA called for the IDB Group to continue to excel in improving benchmarks in its role foreign ownership limit to Funding for station granted as catalyst for developmental projects 25% EGYPT: Banque Misr has provided and interventions around the world. UAE: To address the unmet demand Upper Egypt Electricity Production from large foreign institutional investors, Company with a EGP285 million Authorities taking action Dubai Islamic Bank (DIB) plans to raise (US$35.75 million) diminishing INDONESIA: Indonesian authorities its foreign ownership limit (FOL) from Musharakah facility to fund the 15% to 25% upon receiving necessary maintenance and renovation of the are planning to introduce a slew of policies next year in a bid to boost the regulatory approvals; following a recent power producer’s Al-Waledeya station in consensus by its board of directors. Assiut. The 80-month facility (from the fl agging Islamic banking sector. The fi rst withdrawal) is split into 20-month initiatives include the regulation of foreign exchange markets, introducing “Following a well-craft ed strategy during withdrawal periods with a 60-month the economic downturn, we ensured that repayment period. Islamic repurchase agreements as well as conducting education and awareness while aligning the bank to the adverse programs. Shariah compliant assets market conditions prevailing at the time, Libya’s Islamic banking aim in the republic are estimated to grow we remain cognizant of stakeholders’ LIBYA: The central bank has met with between 19-29% in 2014, lower than the expectations from the organization. the heads of Libya’s Islamic banking 31.8% forecast in 2013 and almost half Hence, the strategy and the business departments in local banks to review of 2012’s performance, which reached model shift were squarely aimed to the progress in the country’s changeover 34.1%. improve and maximize returns for the to Islamic fi nance, following the benefi t of stakeholders, including local, regional and global investors,” said implementation of Law No. 46 by Libya’s Observers trade places National Transitional Council in 2012. Adnan Chilwan, CEO of DIB. Committ ees have been formed to monitor BANGLADESH: The central bank of the roll out of the interest-free banking Bangladesh has swapped Shafi qul Islam Adnan further elucidated that the policy. and Kazi Sayedur Rahman, observers improved overall economic climate at ICB Islamic Bank and Islami Bank and the stellar performance of the Bangladesh respectively, in their roles; Dubai Financial Market over the last with Shafi qul observing at Islami Bank year have allowed the bank to build AMERICAS Bangladesh and Kazi at ICB Islamic, greater liquidity for foreign investors, following a central bank meeting particularly institutional funds. “The Geographically diversified regarding allegations of militancy bank’s stock is up signifi cantly so far investment fi nancing. As yet no evidence has been [in 2013] and we remain confi dent US: Investment bank Taylor-DeJongh found. that, with a return to growth, we will has brokered a deal between US-based continue to fulfi l our commitments to all Continental Rail and unnamed Islamic Oil import to increase stakeholders,” he added. banks whereby the latt er will provide BANGLADESH: Bangladesh Petroleum fi nancing for the acquisition of 1,000 rail In light of the MSCI upgrade taking eff ect Corporation (BPC) has announced this year, the new FOL limit is believed cars. Taylor-DeJongh is also said to have plans to increase the volume of oil it brokered a deal for private toll bridges to position DIB as a strong candidate for imports for its refi nery in 2014 by 8%, inclusion in the MSCI basket of securities. in the US to be fi nanced in a Shariah bring the total to 1.3 million tonnes. compliant manner. The emerging status upgrade is expected BPC has procured fi nancing from the to reign in AED1 billion (US$272.18 IDB and foreign banks to meet the million)-worth of investments into listed growing oil costs of importing oil from companies. Following the board approval ASIA Abu Dhabi National Oil Company and for the FOL, the bank will proceed to Saudi Aramco. The country’s fuel needs Agreement ratified follow the required regulatory process to continued formalize the decision. AZERBAĲ AN: The parliament of Azerbaĳ an has agreed to register the republic as a member of the IDB’s International Islamic Trade Finance Corporation.

IDB eyes TRX INCEIF has 83 subscribers to Islamic Finance news, and pays less than US$24 per subscription. MALAYSIA: The IDB plans to establish an Islamic Center of Excellence at the Tun IFN is for everyone, not just the CEOs Razak Exchange (TRX) in Kuala Lumpur within the next three to ﬁ ve years, announced Ahmad Husni Hanadzlah, Contact us now and see how we can help your entire team Call: +603 2162 7800 or the second ﬁ nance minister of Malaysia. Email: [email protected] TRX, or formerly known as the KL International Financial District, is slated

© 25 8th January 2014 NEWS continued... subsidiary, does not have the resources to Business Custodians debuts have grown sharply due to a shortfall manage the expected volume under the first Queensland-based program. of natural gas, and the government Islamic investment fund subsidizes the cost of fuel oil for the local market. Separately, Sirajul Haq, the fi nance AUSTRALIA: Business Custodians minister of Khyber Pakhtoonkhawa (BC) and the Australian Shariah board province, has recently called for the Noor disposes stake for Islamic Finance-Australian Center Youth Business Program, worth PKR100 for Islamic Financial Studies (ASBIF- PAKISTAN: Kuwait-based Noor billion (US$929.74 million), to be ACIFS) have successfully launched the Financial Investment Company has channeled through Islamic banking. Brisbane Islamic Investment Fund (BIIF). announced that it will sell its entire stake BIIF is the fi rst Queensland-based and (498.4 million ordinary shares) in Shariah Funding for projects in regulated Shariah compliant investment compliant Meezan Bank. The transaction Kyrgyzstan fund in Australia and is structured as is estimated to be valued at US$190 an Australian resident open-ended unit million. Karachi-based investment bank KYRGYZSTAN: The Jeddah-based trust. Vision Financial Holding has expressed IDB will provide fi nancing of US$37.25 interest in acquiring the 49.1% stake. million for the implementation of two In a statement communicated to projects in Kyrgyzstan: the improvement Islamic Finance news, an estimated PRS tax waived of the electricity supply of Arkin massif initial investment of AU$100 million in Batken province, which will receive (US$88.51 million) will kick-start BIIF, MALAYSIA: The 8% tax on the Private US$16.25 million, and the reconstruction with a number of projects identifi ed Retirement Scheme (PRS), which off ers of the Osh-Batken-Isfana highway from for commencement in March 2014. The Shariah compliant and conventional th th the 74 up to 108 kilometer, which fund will be invested solely in Shariah private insurance investment funds to will receive US$21 million. The IDB compliant projects and established Malaysians, is waived for withdrawal president also proposed that Kyrgyzstan small to medium-sized businesses, by retirees above the age of 55 years, becomes a member of the Islamic located in both Australia and overseas. confi rmed Ahmad Maslan, the deputy Solidarity Fund for Development and the It is also expected to utilize some of the fi nance minister. This is to discourage Islamic Corporation for the Insurance of excess liquidity of over US$1 trillion early withdrawals from the scheme. Investment and Export Credits. in the global Islamic investment funds landscape over the next decade. Exclusive representation Separately, the deputy prime minister MALAYSIA: Global Islamic fi nance of Kyrgyzstan, Taiyrbek Sarpashev According to the fund’s information has announced the launch of an legal network iSfi n has partnered with memorandum, 30% of the portfolio Islamic leasing company with an Malaysian law fi rm Azmi & Associates will be focused on tourism; 20% on authorized capital up to US$10 million, to make the latt er the exclusive manufacturing and service businesses; in collaboration with the IDB affi liate representative for iSfi n in Malaysia. Azmi 15% on livestock; 15% on solar and organization, Islamic Corporation for the & Associates’ managing partner and head clean energy; and 10% on real estate, Development of the Private Sector (ICD). of the global fi nancial services & Islamic energy and resources respectively. The president of the ICD, Khaled Al banking practice group, Ahmad Lutfi The investment timeframe is set for a Aboodi agreed that an allocation of US$5 Abdull Mutalip has also been appointed minimum period of seven years and million-worth of credits to support small to the advisory board of legal network. targets to achieve an annualized rate and medium-sized businesses would be of return ranging from 10-12% above made to the state banks of Kyrgyzstan in the average Reserve Bank of Australia Target not met 2014. cash rate in each respective fi nancial PAKISTAN: Three Islamic banks in year. Investment risks will be mitigated Pakistan have collectively disbursed New recommendations primarily by a portfolio spread across PKR250 million (US$2.34 million)-worth PAKISTAN: The Steering Committ ee a number of acquisitions in diff erent of Shariah compliant fi nancing to the for the Promotion of Islamic Banking is industry segments. agricultural sector for the year 2013-14. expected to deliver its recommendations The amount of fi nancing provided fell by the 31st January 2014, as required by As the manager and trustee of BIIF, BC short of the PKR500 million (US$4.68 its terms of reference. holds an Australian Financial Services million) target set by the State Bank of License which is strictly regulated by Pakistan. the Australian Securities and Investment BGSM plans Sukuk Commission, a regulatory body which is Focus on youth business MALAYSIA: A 65% stake of recognized worldwide. ASBIF-ACIFS and telecommunication fi rm, Maxis; 4.88 BC are jointly responsible for regulatory PAKISTAN: Shariah compliant billion shares, were traded off -market corporate governance as well as ensuring Meezan Bank has affi rmed its support for RM7 (US$2.12) on the 23rd December adherence to the investors’ mandate and in providing the National Bank of 2013. The sale equaled the number of compliance with Islamic investment Pakistan (NBP) with any assistance to shares owned by T Ananda Krishnan, criteria. expedite the latt er’s eff ort in converting majority shareholder in the company. the prime minister’s Youth Business Reports have stated that the transaction Loan Scheme to be in compliance with could be linked to the planned two-year the Shariah. NBP, which off ers Islamic banking solutions through its Aitemaad continued

© 26 8th January 2014 NEWS continued... US$48 billion of new issuances led by Halal food financing to see Sukuk program worth up to RM10 billion Malaysia and Saudi Arabia, according to CIMB Islamic‘s CEO, Badlisyah Abdul good prospects in Saudi (US$3.03 billion) announced by parent Arabia company Binariang GSM (BGSM) in Ghani. CIMB Islamic has arranged RM9.7 November 2013. billion (US$2.94 billion)-worth of Sukuk SAUDI ARABIA: According to a issuance, garnering a 25.9% market share; recent research report released by NCB Malaysia retained the lead in the global CIMB donates Capital (NCBC), Saudi Arabia’s food Sukuk market in 2013, accounting for and agriculture sector will maintain its MALAYSIA: CIMB Islamic Bank has 70.5% of the US$75 billion of new Sukuk positive outlook. This could pave the way made a RM240,000 (US$72,657.3) issued globally in the fi rst 10 months of for Halal food fi nancing to fl ourish in the contribution to Yayasan Dakwah the year. kingdom. The asset manager’s optimism Islamiah Malaysia in Sabah for the is att ributed to the strong macroeconomic construction of a fi ve-unit longhouse in NPF on the rise environment that supports the sector the district of Kudat. PAKISTAN: As a result of poor law outlook, together with heavyweights, and order, an energy crisis as well as a Almarai and Savola seeking to strengthen Potential earnings of RM500 higher default ratio in the SME sector, their dominance though capacity million non-performing fi nancing (NPF) of the increases. Islamic banking industry in Pakistan has MALAYSIA: Estimates show that the increased by PKR1.2 billion (US$11.29 The global Halal industry is estimated sale of signifi cant shares in AMMB million) from December 2012 to reach to be worth more than US$2 trillion. The Holdings AmInsurance and AmTakaful, PKR19.7 billion (US$185.41 million) by lion’s share of the market is commanded to Metlife, could make the Malaysian the end of September 2013. by the Islamic fi nance industry at an company RM500 million (US$152.11 estimated US$1 trillion with the food million). This follows the deal agreed sector valued at over US$650 billion. between Metlife and AMMB Holdings in J&K Bank to walk the talk December 2013. INDIA: Mirwaiz Umar Farooq, the Both Almarai and Savola have issued chairman of All Parties Hurriyat Sukuk this year worth SAR1.7 billion Stable outlook for Turkey Conference, has urged Jammu and (US$453.22 million) and US$400 million, Kashmir Bank to initiate Islamic banking respectively. Farouk Miah, the head of TURKEY: Escalating interest rates, services following the bank’s chairman’s equity research at NCBC, expounded declining economic growth and a statement indicating that Shariah that Almarai’s performance is set to weakened Turkish lira may lead to a compliant banking holds great potential improve in 2014, with the continued modest fall in margins and rise in loan in the state. fall in soft commodity prices and bett er impairment charges in Turkish banks next performance in its poultry business being year, according to Fitch Ratings. However, the drivers for the dairy producer. As the republic’s banking sector still has a Drive for technology for Savola, Farouk expects that margin stable outlook as strong capitalization, INDIA: Oracle Financial Services expansions and continued benefi ts from healthy funding structures and liquid Soft ware has outlined the growth of non-core investments would lead to a balance sheets are expected to drive down Islamic banking and the increasing compounded annual growth rate income the impact on credit quality. demand for technological solutions from accretion of 17% between 2013 and 2018. North American banks as the growth Al-Falaah’s expansion plans drivers for the company, affi rmed Chet An international trade food and beverage Kamat, the fi rm’s managing director and exhibition held in Saudi Arabia has SRI LANKA: Islamic fi nance company CEO. Al-Falaah will launch microfi nance revealed that the kingdom’s food products in the fi scal year beginning industry is in the midst of a boom and April, with an eye to double its branch Towards poverty alleviation is forecast to grow signifi cantly over the network to 10 in the next two years, PAKISTAN: Microcredit services next fi ve years. The rise is expected to confi rmed Krishan Thilakaratne, the provider Akhuwat has distributed Riba- sustain the country’s demand and meet fi rm’s managing director. free fi nancing totaling to PKR6 billion its international export potential. Several (US$55.77 million), with a recovery rate prominent food and beverage companies have expressed their intentions to gain a BIMB completes purchase of 99%, said Saleem Ranjha, one of the fi rm’s directors. Out of that amount, bett er foothold in the industry to tap the MALAYSIA: Bank Islam has announced approximately PKR1 billion (US$9.26 kingdom’s potential. the completion of BIMB Holdings million) was distributed in the metropolis acquisition of the outstanding 49% of Faisalabad. share of the bank. This follows an Are you reading announcement of BIMB’s intention to Adopt the Muamalah system issue a RM1.7 billion (US$521.62 million) us on your Sukuk in order to fund the purchase. MALAYSIA: It is reported that 70% of Islamic banking deposits and customers iPad / Malaysia to retain the lead in Malaysia comprise of non-Muslims and entrepreneurs, according to Musa iPhone? MALAYSIA: The Sukuk market will Aman, the chief minister of the state of perform positively in 2014, with a projection of between US$42 billion and continued

© 27 8th January 2014 NEWS continued... a potential share swap. Confi rmation of Oman seeks to debut maiden th Sarawak. Musa also indicated that while the share swap will be made on the 30 Sukuk worth US$517.98 June 2014, but in the meantime NASDAQ this is a positive indication towards the million this year acceptance of Islamic fi nancial services OMX Group has the option to increase its by non-Muslims, Muslims would lose out share to 7% and will also receive a series OMAN: In a bid to meet its projected if they do not participate in the Islamic of cash payments. Borsa Istanbul will budget defi cits, Darwish Al Balushi, fi nancial landscape. buy trading, clearing and infrastructure fi nancial aff airs minister of Oman, has technology for all asset classes from confi rmed that the government will NASDAQ OMX and will be able to use debut a sovereign Sukuk this year. BSN offers luxury prizes and resell the soft ware in 25 countries. The Omani government intends to MALAYSIA: Bank Simpanan Nasional Exchange chairman Ibrahim Turhan raise approximately OMR200 million (BSN) aims to reach RM3 billion stated that Borsa Istanbul aims to list its (US$517.98 million) from its domestic (US$911.85 million) in deposits to its shares by the end of 2015. market as part of its plan to plug the Mudarabah-based, Shariah compliant sultanate’s estimated budget defi cit in Sĳ il Simpanan Premium (SSP) product, LTH exits company 2014. which off ers dividends as well as lucky MALAYSIA: Lembaga Tabung Haji draw prizes, including a grand prize of Darwish has reportedly stated that the (LTH), Malaysia’s national Hajj RM1.4 million (US$425,532) apartment in government is att empting to absorb pilgrimage fund board, has sold its 6.76% Kuala Lumpur’s Golden Triangle area. the liquidity available in two Islamic stake of Konsortium Logistik, following banks and the Islamic banking window the proposed acquisition of a 61.61% operations of conventional banks by Guidelines for Islamic share of the company by DRB-HICOM in issuing the Sukuk. “Normally the licensees October. government issues development bonds MALAYSIA: The revised guidelines to borrow from the domestic market, but LTH procured a Shariah compliant announced by Labuan Financial Services this year it will issue Sukuk,” he said. Authority in December have come into fi nancing package totalling GBP225 st million (US$361.11 million) to fi nance eff ect as of the 1 January 2014. The The sultanate witnessed its fi rst Sukuk investments in the UK in October. guidelines seek to provide clarity on the issuance in October 2013, by Tilal application procedures, operational and Development Company. Although regulatory requirements of a Labuan Lack of talent Sukuk regulations in the country are securities (both conventional and MALAYSIA: The talent shortage being at a nascent stage, industry experts Islamic) licensee operating in Labuan experienced in the fi nancial sector is expound a positive sentiment on the International Business and Finance predicted to get worse over the next Sukuk market in Oman. It is expected Center. 10 years, according to Dr Raymond to receive a strong boost in the short to Madden, CEO of the Asian Institute mid-term with the corporate sector and INCEIF dismisses CAP of Finance. The Islamic fi nance sector, the government looking towards Sukuk MALAYSIA: The Consumer Association particularly the fi eld of Shariah expertise, issuances as an att ractive alternative form of Penang (CAP)’s allegation that Islamic is an area that is particularly aff ected by of debt issuance. personal fi nancing products are a “rip- the shortage. The demand for workforce off ” and that banks make up to 42% in employed in the sector is due to rise to The government is said to borrow profi ts per year from such facilities, with 200,000; an increase of 56,000 employees OMR400 million (US$1.04 billion) from monthly profi t rates of 2%, have been in the next decade. foreign and domestic markets to plug the refuted by INCEIF’s teaching fellow budget defi cit which has been projected Abdul Rashid Kadir as unfounded: as Turkish club financing at OMR1.8 billion (US$4.66 billion). Besides the borrowings which consists the Malaysian central bank would not TURKEY: Kuveyt Turk has signed a permit such profi t rate calculation. Abdul of OMR200 million (US$517.98 million) syndicated club Murabahah facility in foreign borrowings and Sukuk Rashid called for in-depth studies and with a consortium of banks from discussions with the central bank over respectively, a surplus of OMR1 billion nine countries. The banks include (US$2.59 billion) from 2012 and another any concerns with regards to Islamic mandated lead arrangers: ABC Islamic fi nancial products. OMR400 million (US$1.04 billion) in Bank, Abu Dhabi Commercial Bank, fi nancial reserves will be used to meet the Citibank, Emirates NBD Capital, defi cit. Agreement signed HSBC Amanah Malaysia, Kuwait TURKEY: The IDB and Turkish bank Finance House (Bahrain) and Standard “We can borrow from local market to TKSB have agreed a US$220 million Chartered Bank; lead arranger Kuwait meet short-term requirements, while Mudarabah deal which will be used to International Bank and arrangers: Banka external borrowings are for meeting fi nance energy projects in the republic. Kombëtare Tregtare, Commerzbank long-term requirements. Our general Aktiengesellschaft , Dubai Islamic Bank debt is OMR1.6 billion (US$4.14 billion) Potential share swap and the IDB. and it is low when compared with the country’s gross domestic product. It all TURKEY: NASDAQ OMX Group has The facility comprises of two separate depends on the size of the economy and announced that it will take a 5% share tranches worth US$272 million and the ability of the government to repay the of Borsa Istanbul in a deal that holds the EUR83 million (US$112.77 million) debt. We are still in safe limits,” affi rmed possibility of Borsa Istanbul gaining a respectively. The fi rst tranche Darwish. 2% share in the US company, as part of continued

© 28 8th January 2014 NEWS continued... replacing; Mark Watt s, the managing Public Mutual launches new carries a one-year term at a rate of director and chief investment offi cer Islamic equity fund on the of NBAD’s Asset Management Group, LIBOR+EURIBOR+90bps, while the back of resilient prospects of second, holds a term of two years at a believes that Sukuk in the GCC will rate of LIBOR+EURIBOR+1.25%. earn as much as 3% on average in 2014. the Malaysian economy In 2013, NBAD’s Sukuk Income Fund, MALAYSIA: Public Mutual, a wholly- was the best performer of the year owned subsidiary of Malaysia-based among 17 Islamic bond funds tracked by Public Bank, has launched a new Bloomberg in the GCC, making a 2.3% EUROPE Islamic fund with two potential gain. EIIB ups stakeholding streams of return. The Public Islamic Growth & Income Fund (PISGIF) is a UK: European Islamic Investment Bank Funding for new projects Shariah compliant equity fund which (EIIB) will increase its shareholding in is engineered to achieve an optimal subsidiary Rasmala Holdings by issuing approved combination of capital growth and 152.3 million shares to purchase the GLOBAL: The IDB board of directors, regular income by primarily investing latt er’s share at a ratio of 3.6 EIIB shares in a meeting on the 22nd December, has in a diversifi ed portfolio of growth and per Rasmala Holdings share. This will approved US$285.4 million-worth of dividend stocks in the domestic market. increase EIIB’s current 56.8% stake to project funding for new development 76.3%. projects in both member countries and Affi rming her confi dence in the country’s Muslim communities in non-member economic landscape, Yeoh Kim Hong, countries. CEO of Public Mutual, said: “The GLOBAL prospects for growth and dividend stocks Transparency still a key listed on Bursa Malaysia are generally IBB accepts offer challenge resilient as the broad base of the GLOBAL: Over 90% of the shareholders GLOBAL: Regulatory developments Malaysian economy off ers opportunities of Islamic Bank of Britain (IBB) have in Saudi Arabia and Qatar (including for these two diff erent types of accepted the GBP24.1 million (US$39.26 the new Qatar Central Bank Law) are companies to thrive in. million) takeover off er made by Qatar’s expected to promote a higher level Masraf Al Rayan, allowing the latt er to of transparency, which absence is “Share prices of growth companies fully control IBB should the deal receive deemed as a hurdle in the GCC banking may be more volatile than the broad regulatory clearance. landscape including among Islamic market as these companies are focused banks, according to a report by Insight on achieving strong earnings growth. Risk-sharing deal in China Discovery. Meanwhile, dividend stocks are considered more stable as their dividend GLOBAL: IFC, the private investment yields help to cushion potential declines arm of the World Bank Group, and New issuers for 2014 in their share prices during periods Standard Chartered Bank have partnered GLOBAL: Industry experts believe that of market volatility,” continues Yeoh. in a risk-sharing facility, to increase debut Sukuk issued by governments and She elucidated that growth companies the amount of renminbi-denominated corporates will drive the Islamic fi nance are typically in the fi nancial services, trade fi nance available to Chinese market in 2014, with Moody’s estimating construction, oil and gas, healthcare and banks, businesses and corporates and that approximately US$60 billion-worth manufacturing sectors. Dividend stocks emerging markets involved in trade of Sukuk will be sold this year, primarily tend to be in sectors such as consumer, with China. The facility of up to CNY3 by Malaysia and GCC countries. GCC telecommunications, utilities, and real billion (US$490.11 million) is anchored countries sold US$21 billion-worth of estate investment trusts. by an investment of up to US$100 million Sukuk in 2013, a fi gure roughly the same from IFC and US$250 million from as the sales for 2012. Klaus Froehlich, the Distributing income on an annual Standard Chartered. The additional head of investment banking for MENA at basis, the equity exposure of the fund funds have been provided by the Morgan Stanley, believes US$40-45 billion ranges from 75-98% of its net asset value Korea Development Bank and Swiss Re could be possible for issuances out of the (NAV). PISGIF looks to invest in Sukuk, International. region in 2014. Islamic liquid assets including Islamic money market instruments. Twenty fi ve In October IFC bought 167 million shares In terms of facilitating issuances, percent of its NAV has been allocated in Ahli United Bank (AUB) as part of a HSBC helped to manage 110 sales in for investments in selected foreign conversion of its preference shares in 2013, resulting in a 17% share of the markets. The fund aff ords investors the AUB to equity. global Sukuk market, according to data opportunity to capitalize on Malaysia’s compiled by Bloomberg. CIMB Group economic growth prospects in the Sukuk growth for 2014 and Maybank were placed second and medium to long-term. GLOBAL: The Sukuk industry in the third, respectively. GCC is set to grow in 2014 according Public Mutual is said to be the largest to industry players. Humphrey Percy, GFH Capital’s acquisition private unit trust company in the CEO of BLME, predicts that scheduled country. At the end of November 2013, GLOBAL: Dubai-based GFH Capital the total NAV of the funds managed Sukuk maturities in Gulf Arab countries has completed the acquisition of a prime next year will encourage new issuances, by the company stood at RM61 billion (US$18.55 million). many larger than the ones they will be continued

continued... certifi cates and debt. This follows the installments. The positions are initially Central London residential property issuance of Sukuk in 2013 by Emirates purchased by KFH and resold to the located in Kensington. The property is a Airlines from fi nanciers including Dubai public. The ceiling of the service is Grade II-listed building overlooking the Islamic Bank and Abu Dhabi Islamic KD15,000 (US$53,059.08). Queens Gate Gardens. GFH Capital is a Bank. fully-owned subsidiary of Bahrain-based Decree issued In related news, Ibrahim Al Assaf, the Islamic investment bank, Gulf Finance UAE: Sheikh Mohammed Rashid, the House. fi nance minister for Saudi Arabia, has said that the Kingdom is contemplating vice-president of the UAE and ruler of Sukuk in order to raise funds for a new Dubai, has issued a decree to establish Non-traditional assets airport in Taif; reportedly construction a center dedicated towards developing GLOBAL: The anticipated increase of the airport via public sector funds has Dubai as a capital for the Islamic economy. The center will hold regulatory in Sukuk issuances in 2014 from the already been agreed upon. powers to draw up Shariah compliance GCC region by industry players is also standards for fi nancial services. expected to feature an increase in new World Bank collaboration structures using an expanded range GLOBAL: The World Bank and Islamic of assets as underlying profi t sources, Deal concluded consultancy fi rm Bait Al Mashura opening the option of Sukuk issuance to have signed an agreement to reinforce UAE: Following talks in September, a larger number of companies, according cooperation in a range of areas, including Istithmar World, the investment arm to market observers. Examples in 2013 research and knowledge in Islamic of state-owned Dubai World, has sold include Ooredoo, using airtime as an fi nance. its 50% stake in Miami Beach property, underlying asset and Emirates, using Fontainebleau Hotel, back to the revenues per passenger. developer, Turnberry, according to a Islamic banking assets to report by Reuters. The price of the sale is Niche market in North Africa grow not yet known. GLOBAL: The number of fi nancial GLOBAL: Islamic banking assets in rapid growth markets Indonesia, Malaysia, The company narrowly avoided a institutions off ering Islamic banking default in 2009 on the outstanding products has exceeded 600, operating the UAE, Saudi Arabia, Turkey and Qatar are projected to reach an estimated US$3.2 billion Sukuk issued by its in 75 countries, according to Gallup subsidiary Nakheel. World Poll survey conducted in 2012 US$1.6 trillion in 2018, according to the to supplement the World Bank Global EY World Islamic Competitive Report Financial Inclusion (Global Findex) 2013-14. Out of this share, Malaysia is Shariah compliant working expected to hold at least US$390 billion, database. The poll showed that in capital up from the US$125 billion recorded in Algeria, Egypt, Morocco, Tunisia and 2012. In 2012, the rapid growth markets OMAN: Maisarah, Bank Dhofar’s Yemen, only 3% of respondents said registered a fi ve-year compound annual Islamic window, has launched a new they currently use a Shariah compliant growth rate of 16.4% and commanded Mudarabah-based business working banking service and only 48% had heard 78% of global Islamic banking assets. capital fi nance product that can be used of Islamic banks operating within their by large and mid-sized businesses to country. avoid using short-term, interest-based fi nancing products for working capital Ableace Raakin-Amanie MIDDLE EAST needs. partnership Precedence set Successful 2013 GLOBAL: Malaysia-based Islamic UAE: Sukuk issued outside Abu Dhabi advisory fi rm Ableace Raakin has by public sector-owned entities within QATAR: Doha-based Shariah compliant partnered with Amanie Group in a 50:50 the emirate will be eligible for dual investment bank, QInvest, has venture leading to the establishment of listing on the Abu Dhabi Exchange revealed that it was involved in Sukuk Ableace Raakin-Amanie, a joint venture (ADX) following the precedence set transactions totalling US$3.5 billion in domiciled in Dubai, to tap into the by approval from the Securities and 2013, acting as joint lead manager and commodity Murabahah Middle Eastern Commodities Authority (SCA) for bookrunner for the US$1.25 billion Sukuk market. the secondary listing of Abu Dhabi issued by Ooredoo and the US$1.25 government bonds on the ADX; the billion Sukuk issued by Turkey this year. Sukuk popular choice for air bonds have been listed on the London The company anticipates 2014 to be a Stock Exchange since 2009. year of increased Sukuk activity both finance in the MENA region and in the wider GLOBAL: Banks in the Gulf are primed KFH launches educational world, with Islamic fi nance becoming a to increase funding to airlines in the more mainstream product. region, following the combined total financing product US$160 billion-worth of orders placed by KUWAIT: Shariah compliant Kuwait Syrian refugee relief Emirates Airline, Etihad Airways, Qatar Finance House (KFH) has launched a UAE: Dubai Islamic Bank has donated Airways and FlyDubai at the Dubai new fi nancing product allowing the AED10 million (US$2.72 million) to the Airshow last year. The debt instruments public, whether they are KFH clients or “Our Hearts with the Syrians” campaign predicted for use include Sukuk, bonds, not, to purchase places at schools and fi nance leases, enhanced equipment trust universities, with monthly payment continued

continued... Qaiwain and Union National Bank acting Islamic home fi nancing packages for launched by the Red Crescent Authority as bookrunners. homes in the new development. in the UAE. Increase in PPPs New ATM launched Steady performance since SAUDI ARABIA: The Saudi Arabian BAHRAIN: Kuwait Finance House 2011 government is expecting the private — Bahrain has added a new ATM to sector to become more involved in its network in Bahrain, located at the BAHRAIN: The Bahraini banking sector infrastructure development projects to Women’s Competence Development can expect modest growth in 2014, ease the burden on the government, Center (Riyadat) in A’Ali, in support of according to a new report by Fitch, according to a report released by the Riyadat initiative launched by the following a reasonable performance since National Commercial Bank. The Supreme Council for Women and in the 2011, despite political uncertainty and kingdom is experiencing a growth in the hopes of encouraging and supporting social unrest. The strong variance in the number of private public partnerships the entrepreneurship of Bahraini women core capital ratios of the country’s banks (PPPs) and Sukuk is a fi nancing option using the center. cause the ratings agency to believe that that is also gaining traction as a means to capitalization at Bank of Bahrain and diversify fi nancial exposure. Kuwait and Ahli United Bank may need M&A in the UAE boosting in the medium term. UAE: According to the 2013 M&A Basel III adoption Att ractive Index released by Cass The rating agency predicts a pick-up BAHRAIN: The Central Bank of Bahrain Business School of City University in Bahrain’s economic growth for 2013 has introduced new regulations requiring London, the UAE is ranked as the 19th to 5.5% due to a boost by government all licensed fi nancial institutions, all (out of 131) most att ractive country for spending and oil production, but this approved persons and material risk- merger and acquisition (M&A) activity; will be tempered by expected rise of the takers whose total annual remuneration up eight places over the last fi ve years. country’s debt to GDP ratio to 46.5% is in excess of BHD100,000 (US$263,769) The ranking is based on advancements by the end of 2014, leaving Bahrain to publically disclose their risk profi le, in technological development, stable dependent on subsidies from the GCC. risk management, capital adequacy, regulatory and political environment, capital instruments and remuneration economic and fi nancial factors, SABB grooms talents practices, in a step towards incorporating infrastructure and assets, technological the Basel III measures into its regulatory capability and socio-economic SAUDI ARABIA: HSBC’s Saudi British framework. characteristics of the emirate. Bank (SABB), which off ers Islamic banking services, has launched the ‘SABB Managers Development Program’ for Financing agreed New Islamic banking rules Saudi graduates, whereby participants SAUDI ARABIA: Shariah compliant UAE: New rules regulating Islamic will be given classroom and practical Alinma Bank, has agreed the renewal banking, outsourcing and fi nancial training before att ending a fi ve-week of an existing Islamic credit agreement bonuses for CEOs will be put in place intensive program at HSBC’s Business with Abdullah AM Al-Khodari next year by the Central Bank of the UAE. School in London. The program is Sons Company, an Al Khobar-based The bank’s board of directors has also designed to groom young Saudi talents contracting company. The SAR500 approved the implementation of the US to assume senior leadership positions in million (US$133.30 million) agreement is Foreign Account Tax Compliance Act. the future. comprised of 59% Murabahah fi nancing and 41% multi bonds and documentary th Towards food security QIA looking to invest credit, and will expire on the 30 November 2014. QATAR: Qatar Development Bank QATAR: The state’s sovereign wealth has launched a new Shariah compliant fund, Qatar Investment Authority (QIA), KFH restructuring complete fi nancing scheme in cooperation with is in talks with Kotak Realty Fund with the Livestock Management Unit at the KUWAIT: As part of its restructuring the aim of investing US$200 million in Ministry of Environment and Widam process, Kuwait Finance House has residential property in India, according Food Company. The scheme is aimed launched a new entity focusing on to reports. The fund, which has been at Qatari small and big farm owners for investments, known as KFH Capital appointed by Abu Dhabi Investment the purpose of acquiring and raising Authority to invest in Indian real estate Investment Company, replacing its livestock, in line with the sultanate’s on its behalf, is managed by Kotak subsidiary Al-Muthanna. strategy on national food security. Mahindra Bank. Home financing Barwa approves financing UAB signs loan deal UAE: Shariah compliant Ajman Bank has QATAR: Islamic fi nancier Barwa Bank UAE: United Arab Bank, which off ers entered into a strategic agreement with has agreed to provide a fi nance facility Islamic banking facilities, has announced Meydan Sobha Group, a development of US$123 million to Qatar Petroleum the signing of a US$250 million loan group involved in the establishment of International Upstream, a subsidiary of deal to fi nance its general business. The Mohammed Bin Rashid City - District Qatar Petroleum International. The funds deal was backed by 12 lenders with Abu One, a mixed-use development in Dubai will be used to part fi nance the increase Dhabi Commercial Bank, National Bank that is the brainchild of Mohammed in the oil company’s share capital of Abu Dhabi, Arab Banking Corp, First Rashid Al Maktoum, the prime minister investment in Total E&P Congo to 15%. Gulf Bank, National Bank of Umm al- of the emirate. Ajman Bank will provide

Strong levels for UAE banks Government encourages IPO Saudi Arabian banks UAE: Banking analysts expect the investment SAUDI ARABIA: Accumulated bank liquidity levels of UAE banks to remain QATAR: Qatar International Islamic profi ts in Saudi Arabia are predicted high, with strong deposit growth this Bank (International Islamic) has to hit a record level of almost SAR36 year; Moody’s predicts the level of capital announced it will provide 100% interest- billion (US$9.6 billion) according to data to be maintained at 16%, up from 2010’s free fi nance to Qatari nationals who released by the Saudi Arabian Monetary 14.4%. wish to purchase shares in the Mesaieed Agency. This follows reports that bank Petrochemical Holding Company IPO. profi ts rose by 9% for the fi rst 11 months IIRA signs MoU Qatari nationals have been encouraged of 2013. BAHRAIN: The Islamic International by Sheikh Tamim Bin Hamad Al Thani, Rating Agency (IIRA) will jointly the Emir of Qatar, to take part in the The Saudi Arabian banking sector, conduct ratings on Islamic fi nancial IPO as part of the government’s aim which is theoretically entirely Shariah institutions with Dagong Global to promote a culture of saving and compliant, has benefi ted from the Credit Rating Company by way investment. performance of the kingdom’s economy: of an MoU. The two entities will with total bank reserves increasing by carry out international and national Aggressive expansion 17.4%, total capital accounts increasing scale assessments, with fi duciary in November 2013 by 8.6% to SAR261.9 OMAN: Islamic fi nancier Bank Nizwa assessments including Shariah billion (US$69.82 billion) when compared plans to open four to fi ve branches every governance to be conducted by the with the same period in 2012 and the year over the next fi ve years as part of its IIRA. total budget surplus for the period expansion strategy, confi rmed its CEO 2011-13 coming to almost SAR871 billion Dr Jamil El Jaroudi. The bank recently (US$232.19 billion). IIFM reviews initiatives launched its seventh branch in Ghubra. th BAHRAIN: The 29 International Dubai Group owes US$6 Islamic Financial Market (IIFM) Investing in youth board of directors meeting was million BAHRAIN: Shariah compliant held this week. The board reviewed Khaleeji Commercial Bank (KHCB), UAE: Dubai Group, a unit of Dubai IIFM development initiatives in in collaboration with non-profi t Holdings, has repaid a US$300 million areas including Islamic capital and organization INJAZ-Bahrain, has hosted syndicated loan led by Citigroup, money market standardization and 20 students from Sheikh Abdulla Bin according to reports. This follows news collateralized Murabahah liquidity Isa Secondary School in a ‘Job Shadow last year of the company’s announcement management documentation. The board Program’. KHCB promotes Islamic to restructure up to US$10 billion of its also confi rmed the decision to implement fi nancial education for young people as debt and the sale of its share in Bank the IIFM Sukuk standardization initiative part of its corporate social responsibility Islam Malaysia at the end of 2013. to develop guidelines which will help the program. primary and secondary Sukuk market Bloomberg has reported that some of and the development of Sukuk structure NCBC names its top picks the Dubai Group’s lenders will exit and documentation standards. talks with the company and that fi nal SAUDI ARABIA: Saudi British Bank documentation for a deal between the 150% profit increase (SABB) and Riyad Bank have been company and its remaining creditors singled out as top picks for 2014 by UAE: Government-backed Dubai could be agreed soon. Dubai Group NCBC Research, the research division Investments anticipates a net profi t reportedly owes approximately US$6 of NCB Capital, with the rating given of approximately AED800 million billion to banks. to SABB upgraded to overweight from (US$217.75 million) from 2013, a neutral. Al Rajhi Bank has been removed potential increase of almost 150% on 2012 Dubai Group’s investments include from the local fi nancier’s top picks due to profi ts of AED320.60 million (US$87.26 stakes in Bank Muscat, EFG-Hermes and its retail lending restrictions. million). previously Bank Islam Malaysia.

In November, Dubai Investments ADIB supports pro league Home territory expansion UAE: Abu Dhabi Islamic Bank (ADIB) announced its intention to launch a OMAN: Shariah compliant Meethaq will continue to be Arabian Gulf League’s maiden Sukuk issuance worth up to Bank has opened a new state-of-the-art exclusive banking partner following the US$300 million by the end of 2013. branch in Buraimi this week, as part of its renewal of its three-year sponsorship. planned domestic expansion. The bank New CBB rules aims to open branches in all major cities BAHRAIN: The Central Bank of Bahrain Masraf calls for nomination and towns across Oman. (CBB) has introduced new rules with QATAR: Islamic fi nancier Masraf Al regards to off ering securities and Sukuk Rayan has called for nominations to fi ll Unlicensed lending in an eff ort to enhance transparency, seven seats on its board of directors for crackdown market integrity and investors’ the period 2014-16. Applications will be confi dence in the kingdom’s capital open from the 5-9th January and elections UAE: The Securities and Commodities markets. The framework was released will take place on the 3rd March, during Authority (SCA) has introduced new as a module in the CBB’s Capital Market the bank’s regular general assembly Rulebook Volume 6. meeting. continued

© 32 8th January 2014 NEWS continued... Al Rajhi-ezetop deal margin lending rules, allowing fi rms to SAUDI ARABIA: Al Rajhi Bank has RESULTS lend each client up to 30% of the capital signed a deal with ezetop, an Ireland- Saudi Investment Bank set aside for margin fi nancing, instead based international mobile top up SAUDI ARABIA: Saudi Investment of the previous 10%. Firms that do not provider, to allow customers to use the Bank posted a 41.1% year-on-year growth abide to the new rules and engage in illicit service and send mobile phone top ups in net profi t to reach SAE1.29 billion margin lending will be subjected to a to 100 countries, 24 hours a day, across (US$343.9 million) for the 12-month AED100,000 (US$27,200) fi ne while repeat the bank’s network of 500 branches, 3,300 period ending the 31st December 2013. off enders risk losing their license. The ATMs and 27,000 points of sale. Total assets accrued by 36.28% to stand at rules are to take eff ect immediately. SAR80.49 billion (US$21.46 billion). Lebanon missed its mark The SCA has also issued rules for the issuance and trading of covered bonds, LEBANON: Islamic banking is struggling allowing banks and other fi rms to obtain to thrive in Lebanon, with an increase of licenses to off er such a debt instrument. only US$38 million in total assets across ASSET Malaysia Building Society, in December, the country’s four Islamic banks between MANAGEMENT issued the world’s fi rst covered Sukuk December 2012 and November 2013 Murabahah backed by fi nancing and a market share of less than 1% eight Cheraman launches fund years aft er the introduction of Islamic receivables. INDIA: Shariah compliant Cheraman banking. Analysts believe that a lack Financial Services has received approval of public education regarding Islamic Sukuk set to soar from the Securities and Exchange Board banking and the regulatory framework of India to launch a venture capital fund. GLOBAL: Bond issuance in the GCC are contributors to the slow progress of Known as the Cheraman Premium Fund, is expected to grow this year due the sector in Lebanon. to infrastructure spending by GCC the fund will have a corpus of INR2.5 governments and refi nancing needs billion (US$40.48 million) and will be in the region. S&P expects demand for Pioneering Saudi partnership utilized to support start-up initiatives Sukuk in the GCC to continue to grow SAUDI ARABIA: Cliff ord Chance and infrastructural projects. at a double-digit rate over the next has become the fi rst international law two years, though it’s believed that the fi rm to establish a partnership in Saudi Eyes on Turkey tapering of monetary stimulus by the US Arabia. The fi rm has established a fi ve- GLOBAL: Private equity fi rm Abraaj Federal Reserve may cause instability in partner team in its Riyadh offi ce, with Group plans to make another investment interest rates over the course of the year. a total of 30 lawyers. Mohammed Al in Turkey next year following the recent The GCC has US$30 billion in bonds and Jadaan remains as both special advisor acquisition of Turkish dairy maker syndicated loans maturing in 2014. and managing partner of Al-Jadaan Yorsan Gida Mamulleri. The Dubai-based & Partners Law Firm which has been fi rm, which launched a US$2 billion Higher charges in 2014 integrated into the practice. Islamic growth and infrastructure fund QATAR: Banks in Qatar including banks due to mature in 2016, is reportedly in The Cliff ord Chance Saudi Arabia team off ering Shariah compliant services, such talks with Turkish companies in the food has been consistently ranked Tier 1 for as Qatar Islamic Bank (QIB), Commercial and education sector. each of its practice areas and in the past Bank of Qatar (CBQ) and Doha Bank, year has advised on deals including are likely to see poor earnings growth in the SAR15.2 billion (US$4.05 billion) Hajj funds to Shariah banks 2014 due to net interest margins being Saudi Arabia General Authority of Civil INDONESIA: The Hajj pilgrims’ funds of squeezed by the cost of funds according Aviation (GACA) Sukuk. Indonesia worth IDR11 trillion (US$908.6 to a report by SICO Investment Bank. million) will be shift ed to Islamic banks by the end of 2014, according to reports. CBQ and QIB are expected to see higher Potential gains for Sukuk provisioning charges due to a rise in UAE: Real estate developer Nakheel real estate-impaired loans, whilst higher has announced plans to pay over US$1 Al Meezan’s new fund year-on-year net income for Doha Bank billion of bank debt early, giving a PAKISTAN: Al Meezan Investment is expected to drive earnings, according potential boost to the company’s AED4.4 Management has launched a new Shariah to the report. GCC-listed companies billion (US$1.19 billion) Sukuk. compliant fund known as the Meezan covered by QIB are predicted to show an Capital Preservation Fund, which will be earnings growth of 22% on fi gures from The Islamic facility rose to a high of open for subscription for a limited period 2013, while remaining fl at on a quarter- 108.16 cents on the dollar on the 26th from the 26th December 2013. on-quarter basis. December last year and its yield has reduced by 215bps over the last 12 Second Aussie Islamic Banks pay due diligence months to 6.58% as at the 3rd January. The pension fund BAHRAIN: As at the 5th January 2013, payments of AED2.35 billion (US$626.02 million) in February, which will be 15 AUSTRALIA: First Guardian, a a lett er to the Bahrain bourse stated diversifi ed investment management fi rm that the due diligence between Shariah months ahead of schedule, and AED1.65 billion (US$449.10 million) in August based in Melbourne, has announced compliant Khaleeji Commercial Bank and plans to launch Australia’s second Islamic Bank Alkhair was still ongoing with no represent almost half of the company’s further updates available. outstanding bank debt. continued

continued... well as retail space; the offi ce space and own fi nancial statements for the year pension fund this month. The fund has car parking are available for immediate 2013. The ratings agency also affi rmed been developed with the Australian lease. Arig’s ‘B++’ rating with a revised positive Center for Islamic Finance, the Muslim outlook. Community Cooperative of Australia, The trust has also expanded its and endorsed by the Islamic Council shareholder base with regional and AMMB-MetLife partnership international investors: Emirates NBD, of Victoria, the governing body for the MALAYSIA: In line with its intention state’s Muslim community. which now holds a 5% share, Singapore Enterprises, with 3% and private to select an equity partner for its Family investors with 1%. Singapore Enterprises Takaful and life insurance businesses by Fund exceeds target is a majority shareholder in Sabana, the the end of this year, AMMB Holdings PAKISTAN: ABL Asset Management largest listed Shariah compliant REIT has signed an agreement with MetLife to has announced it has raised over PKR1 in the world in terms of both market seek regulatory approval for a strategic billion (US$9.3 million) in its ABL Islamic capitalization and total assets as of the partnership. Preservation Fund. 30th June 2013. Upon approval, MetLife will own 50% The fund is one of three Shariah Al Hilal proposes dividend plus one share in AmLife Insurance (with compliant funds managed by the AMMB holding the remaining shares), company, which has plans to launch an OMAN: Shariah compliant Al Hilal and AMMB will own 50% plus one share Islamic pension scheme this year. MENA Fund will declare a dividend in AmFamily Takaful, with the rest of of 25 Omani baiza (US$0.06) for 2013, share to be owned by MetLife. subject to approvals. The return is Indian offshore fund in the representative of the 6.5% growth in net Only for Takaful firms making asset value (NAV) since the fi rst NAV st MALAYSIA: The government’s proposed INDIA: Business conglomerate Essel release on the 21 July last year. NAV for i-BR1M scheme will be implemented Group’s fi nancial services arm, Essel the fund stood at OMR1.06 (US$2.74) per st Finance, plans to introduce an Islamic unit as on the 31 December 2013. exclusively through a consortium of fund for foreign investors in partnership Takaful operators, and not conventional with Shariah compliant fund managers insurance players as previously hoped in Malaysia and West Asia. With a corpus for by the Life Insurance Association of of US$100 million, the fi rm is looking to TAKAFUL Malaysia. establish partnerships by March. Pioneering Islamic sacco Estimated to benefi t up to fi ve million KENYA: Crescent Takaful Sacco Society, household recipients with an allocation Separately, Taqwaa Advisory and Shariah promoted by Crescent Investment of RM250 million (US$75.92 million), the Investment Solutions are reported to be Cooperative and Takaful Insurance of scheme qualifi es recipients (with a RM50 establishing a INR2.5 billion (US$40.46 Africa Group, has launched front offi ce (US$15.18) contribution) to a coverage of million) fund on behalf of a state-backed operations. fi rm. up to RM30,000 (US$9,110.7) in the event The savings and credit cooperative of death or permanent disability. Waqf Fund approves budget company (sacco) has become the fi rst Steady Takaful growth BAHRAIN: Bahrain’s Waqf Fund, which Islamic fi rm of its kind to off er savings, recently approved a US$1.4 million fi nancing and investment services MALAYSIA: Despite the changes that budget for 2014, has identifi ed several in compliance with the Shariah. The will be introduced with the enforcement initiatives including providing fi nancial services will also be off ered to Kenyans of the risk-based capital framework in support to AAOIFI to further enhance the overseas. 2014, the Takaful industry in Malaysia Certifi ed Islamic Professional Accountant is expected to maintain a steady rate of qualifi cation as well as launching a ATMC receives approval growth according to industry experts. leadership development program with a SAUDI ARABIA: The Saudi Arabian leading university. Monetary Agency has given its fi nal Ab Latiff Abu Bakar, the president and approval to Alinma Tokio Marine CEO of Takaful Ikhlas, said the Takaful Acquisition of landmark Company (ATMC) for the launching of industry is projected to end 2013 with a property cooperative health insurance products. strong growth of approximately 20%. UAE: Shariah compliant Emirates REIT TIC’s new sanctions has increased its portfolio to almost Arig to boost Takaful Re AED1.2 billion (US$326.62 million) with BAHRAIN: Takaful Re’s fi nancial BAHRAIN: Takaful International the acquisition of the seventh fl oor of the performance is expected to improve over Company has announced new sanctions Index Tower comprising 22,000 sq ft of the short-term as its parent company, for the year 2014 including a Wakalah commercial space, from EFG Hermes in Arab Insurance Group (Arig), will management fee of up to 35% of gross exchange for an approximate 4% share in be adopting tighter control over its contributions instead of the previous 20- the REIT. underwriting operations, predicted 25% range, as well as a Mudarabah profi t AM Best Europe – Rating Services. Arig share of 25% of net investment returns Emirates REIT also has ownership of 698 will consolidate the fi nancial results for managing participants of investment parking spaces in the Index Tower as of Takaful Re’s re-Takaful fund into its funds.

MAA Takaful confident MALAYSIA: MAA Takaful will launch seven Family Takaful products by the ﬁ rst half of 2014, with plans to upgrade the operator’s information technology features. Anticipated growth in the Family Takaful segment is expected to boost MAA Takaful’s ﬁ nancial performance to reach its RM88 million (US$26.7 million) target of new business for 2014.

Takaful Oman’s listing An all New Experience in Events coming your way for 2014 delayed OMAN: Due to unmet quorum for t/FX-PDBUJPOTt/FX'PSNBUt(SFBUFS*OUFSBDUJPOt.PSF'PDVTFEt#FUUFS/FUXPSLJOHt"OE4PNFUIJOH&YDMVTJWF3&46-54 the founding general assembly of the fi rm (under incorporation), Takaful Oman Company’s listing on the Muscat Securities Market, which was scheduled for the 2nd January, has been delayed until the listing requirements are met. September, DUBAI Al Madina Takaful opens doors OMAN: Al Madina Insurance Company (trading as Al Madina Takaful) commenced off ering Takaful products on the 1st January following th th th th regulatory approval from the Capital September, DUBAI 26 - 27 May, KUALA LUMPUR 15 - 16 May, LUXEMBOURG Markets Authority, to eff ectively become Oman’s fi rst Takaful operator. All existing insurance policy agreements will be replaced by Shariah compliant agreements and the fi rm is due to make a public announcement on applicable Wakalah and Mudarabah fees applicable for this year. June, DUBAI

AIG joins Takaful market MALAYSIA: AIG Malaysia Insurance has received regulatory approval to off er re- Takaful products and is looking to begin operations in the fi rst quarter, confi rmed CEO Antony Lee. 15th October, DHAKA 15th April, JAKARTA 21st April, TEHRAN Issue approved by regulator QATAR: Doha Insurance which operates Takaful window, Doha Takaful, has received regulatory approval for the issuance of 24.26 million new shares via 10th June, KUWAIT November, RIYADH a rights issue. The shares will be priced at QAR18 (US$4.94) each. The company will next seek shareholder approval for a capital increase worth QAR436.7 million (US$119.86 million), which will almost double the company’s capital. 13th October, COLOMBO 6th November, ISTANBUL November, DUBAI

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outlook for the UAE, Saudi Arabia and Oman remains stable RATINGS Kuwait has a positive trend, as does OMAN: S&P has affi rmed Oman’s rating Qatar despite the potential for asset BGSM receives rating of ‘A/A-1’ for its short and long-term quality issues and capacity limitations; sovereign credit ratings. The ratings have MALAYSIA: Investment holding whilst in Egypt, Lebanon and Jordan a stable outlook. company BGSM Management’s proposed the sector still remains a challenging Sukuk Musharakah program worth up to environment. RM10 billion (US$3.07 billion) has been Ratings withdrawn assigned a preliminary rating of ‘AA3’ by Ratings for Maybank MALAYSIA: Following a full early RAM, with a stable outlook. redemption, MARC has withdrawn MALAYSIA: Maybank has been assigned the ‘AA-IS’ rating on Malakoff Power’s ASEAN-scale fi nancial institution ratings SHUAA stable RM5.6 billion (US$1.7 billion) Murabahah of ‘seaAAA/Stable/seaP1’ by RAM securities. The facility was restructured UAE: SHUAA Capital, the parent based on the bank’s strong position in using a new RM5.38 billion (US$1.64 company of Shariah compliant Gulf its business lines. The rating agency also billion) Sukuk Murabahah issuance rated Installments, has been assigned a long- affi rmed the ‘AAA/Stable/P1’ rating for ‘AA-IS’, which is still under MARC’s term foreign and domestic currency Maybank Islamic, Maybank, Maybank rating surveillance. issuer rating of ‘B1’ by Moody’s. The Investment Bank and Cekap Mentari, the negative outlook on the ratings has been group’s funding conduit. revised to stable. Rating for BayuPadu Final rating confirmed MALAYSIA: Oil and gas services and UNB affirmed solutions provider SapuraKencana’s MALAYSIA: The proposed RM10 billion RM500 million (US$151.98 million) UAE: Moody’s has affi rmed the ‘A1’ (US$3.04 billion) Sukuk Musharakah Istisnah serial bonds have been affi rmed long-term and ‘Prime-1’ short-term program by BGSM Management has at ‘AA-ID’ by MARC, with a stable deposit ratings as well as ‘D+’ standalone been assigned a fi nal ‘AA3/stable’ rating outlook. The facility is issued via the bank fi nancial strength rating of Union by RAM. National Bank (UNB), which off ers fi rm’s SPV, BayuPadu. Shariah compliant services. The outlook S&P affirms final rating on the long-term deposit ratings have Mydin reaffirmed TUNISIA: At the request of the Tunisian been changed to stable from negative. MALAYSIA: Retail outlet operator government, S&P will no longer rate the Mydin Mohamed Holdings’ RM350 country, but affi rmed that the rating of million (US$106.38 million) Islamic Still on Rating Watch ‘B/B’ with a negative outlook was valid at medium-term notes program (2011/2024) MALAYSIA: The ‘BBB3’ rating on Tunisia’s withdrawal from the rating list has been reaffi rmed at ‘AAA(fg)/stable’ MRCB Southern Link’s RM845 million in December 2013. by RAM. (US$259.22 million) senior Sukuk and the ‘BB1’ rating on its RM199 million ‘AA’ for Kuwait (US$61.05 million) junior Sukuk will TTPC reaffirmed KUWAIT: Fitch has affi rmed the ‘AA’ be maintained on RAM’s Rating Watch MALAYSIA: Independent power long-term foreign and local currency (developing outlook), pending the producer Teknologi Tenaga Perlis issuer default ratings for Kuwait. The government of Malaysia’s long-term Consortium (TTPC)’s RM835 million country ceiling is affi rmed at ‘AA+’ solution to the Eastern Dispersal Link (US$253.8 million) Sukuk Murabahah and short-term foreign currency issuer highway’s inability to start tolling (2013/2023) has been reaffi rmed at ‘AA1’ default rating at ‘F1+’. The outlook for operations. by RAM, with a stable outlook. the long-term ratings is stable.

Outlook revision for SABB ACR ReTakaful rated ABS ratings withdrawn SAUDI ARABIA: Saudi British Bank’s ‘A’ MALAYSIA: Following an early GLOBAL: UAE-based ACR ReTakaful long-term credit rating has been affi rmed redemption of all outstanding amounts Holdings’ ‘bbb-’ issuer credit rating by Fitch, with a stable outlook. in November, MARC has withdrawn the (ICR) has been affi rmed by AM Best respective ‘AAAIS’, ‘AAIS’ and ‘AAAIS’ Asia-Pacifi c. The re-Takaful operator’s ratings on ABS Logistics senior Sukuk AUB upgraded associated companies in Malaysia and Ijarah program consisting of RM100 Bahrain have both received a fi nancial BAHRAIN: S&P has upgraded Ahli million (US$30.45 million) Class A, RM20 strength rating of ‘A-’ and an ICR of ‘a-’. United Bank’s (AUB) long-term million (US$6.09 million) Class B and All ratings carry a stable outlook. counterparty credit rating from ‘BBB’ to RM40 million (US$12.18 million) Class ‘BBB+’; while its short-term counterparty C Sukuk. ABS is Tiong Nam Logistics credit rating was affi rmed at ‘A-2’. The Outlook change for DRB- Holding’s SPV to acquire a portfolio of ratings carry a stable outlook. HICOM warehouse properties from its parent. Stable outlook for 2014 MALAYSIA: The ‘AA-IS’ rating on DRB-HICOM’s RM1.8 billion (US$547.61 PLSA re-evaluated GLOBAL: The ratings outlook for almost million) Islamic medium-term notes MALAYSIA: RAM has reaffi rmed all the banks in the GCC region is stable program has been affi rmed by MARC, highway concessionaire Projek Lintasan according to Fitch, with sound capital with a revised outlook to stable from levels and ample liquidity. The sector negative. continued

© 36 8th January 2014 NEWS continued... Musteq reaffirmed (US$1.12 billion) nominal value junior Sukuk Ijarah. Prior to the withdrawal, Shah Alam (PLSA)’s RM330 million MALAYSIA: Independent power the facilities were rated ‘BBIS’ and ‘B-IS’ (US$100.5 million) Sukuk Ijarah (senior producer Musteq Hydro has had the respectively, with a negative outlook. Sukuk) and RM415 million Sukuk ‘AAA(bg)/Stable’ rating on its bank- Mudarabah (junior Sukuk) at ‘A1’ guaranteed Sukuk Musharakah of up and ‘A3’ respectively. Concurrently, to RM80 million (US$24.34 million) ‘AAA’ for LKPP the outlook on PLSA’s Lebuhraya in nominal value reaffi rmed by RAM, MALAYSIA: Lembaga Kemajuan Kemuning-Shah Alam Highway has refl ecting the credit strength of the bank Perusahaan Pertanian Negeri Pahang been revised to negative from stable guarantee provided by Maybank Islamic (LKPP)’s RM300 million (US$91.36 due to projected insuffi cient funds to (rated ‘AAA/Stable/P1’). million) Bai Bithaman Ajil Islamic meet its fi nancial obligations by 2023. debt securities have been reaffi rmed at As a result, the company has begun a Final rating for TNB Western ‘AAA(s)/stable’ by RAM. refi nancing exercise for its senior Sukuk, Energy to be completed within the next six Outlook upgrade months, with plans for the junior Sukuk MALAYSIA: TNB Western Energy’s RM4 underway. billion (US$1.22 billion) Sukuk has been EGYPT: Fitch has raised Egypt’s economic assigned a fi nal rating of ‘AAAIS’ by outlook to stable from negative, for the JIB Shariah rating maintained MARC, with a stable outlook. The fi rm is fi rst time since the country’s revolution a wholly-owned funding vehicle of TNB in 2011. According to a press release by JORDAN: Jordan Islamic Bank (JIB)’s Manjung Five; which is in turn wholly- the Egyptian Finance Ministry, the ratings ‘AA’ Shariah quality rating has been owned by the country’s national utility agency has maintained its long-term reaffi rmed by Islamic International company, Tenaga Nasional. foreign and local currency credit ratings at Rating Agency, indicating a high ‘B-’ and short-term foreign currency rating standard of compliance with all fronts of at ‘B’. Shariah quality analysis. Stable for Kwantas MALAYSIA: Palm oil producer Kwantas Stable outlook Tradewinds rated Corporation’s RM15 million (US$4.56 million) Sukuk Ijarah and RM65 SAUDI ARABIA: Fitch has assigned a MALAYSIA: Tradewinds Plantation million (US$19.78 million) Murabahah rating of ‘AA-(EXP)’ to Saudi Electricity Capital’s RM180 million (US$54.75 commercial papers/medium-term notes Co’s proposed Sukuk. The outlook for the million) Class A and RM30 million have been affi rmed at ‘AAAID’ and rating is stable. (US$9.13 million) Class B Sukuk Ijarah ‘MARC-2ID(cg)/A-ID(cg)’ respectively by have been rated ‘AAAIS’ and ‘AA+IS’ MARC, with a stable outlook. Ratings reaffirmed respectively by MARC, with a stable outlook. The fi rm’s ‘MARC-1ID(bg)/ MALAYSIA: RAM has reaffi rmed AAAID(bg)’ ratings on its bank- MARC withdraws rating the ‘AA3’ rating of the RM540 million guaranteed Murabahah commercial MALAYSIA: Upon the issuer’s request, (US$164.13 million) Sukuk Murabahah paper/medium-term notes program MARC has withdrawn all ratings on from Jati Cakerawala, a Malaysian worth RM100 million (US$30.42 million) Senai-Desaru Expressway’s RM1.89 investment holding company. The have also been affi rmed with a stable billion (US$575.58 million) nominal value outlook for the rating is stable. outlook. senior Sukuk Ijarah and RM3.69 billion STRUCTURING SHARIAH BASED FINANCIAL PRODUCTS 1818thth – 2020thth FebruaryFebruary 22014,014, DDubaiubai

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Capital is the parent company of Shariah EFG Hermes MOVES compliant Gulf Instalments. EGYPT: EFG Hermes has announced Gulf Finance House the appointment of Khalid Ellaicy as the Al Hilal Banking Services BAHRAIN: The acting CEO of Shariah company’s new chief fi nancial offi cer. compliant Gulf Finance House, Hisham OMAN: Professor Ali Muhyealdin Al Khalid joins EFG Hermes from Orascom Al Rayes, has been confi rmed as CEO. Quradaghi has tendered his resignation Telecom. Rayes has held the position of acting from the Shariah Supervisory Board of CEO since March 2012. Al Hilal Islamic Banking Services (the Affin Holdings Islamic window of Ahli Bank). MALAYSIA: Zulkifl ee Abbas, who GBSA led the alignment of Affi n Bank, Affi n KPMG GLOBAL: Stuart Anderson, the Islamic Bank and Affi n Investment Bank managing director and regional head OMAN: Ashok Hariharan has been as managing director of Affi n Bank, has of S&P Middle East, has succeeded appointed as the head of tax in the been appointed as group CEO of Affi n Giambatt ista Atzeni as chairman of Middle East and South Asia at KPMG. Holdings. Zulkifl ee will continue to serve the Gulf Bond and Sukuk Association His former role at KPMG was that of as managing director of Affi n Bank in (GBSA) Steering Committ ee for 2014, head of tax in Oman and the UAE, addition to his new role. while its Islamic Finance Practice Group and the company’s regional quality will be co-chaired by Hani Ibrahim performance and liaison partner for the Deutsche Bank region. and Alex Armstrong from QInvest, and MALAYSIA: Yusof Yaacob, formerly Debashis Dey from Cliff ord Chance. Goldman Sachs’ Malaysia head of Astro Malaysia Holdings corporate fi nance, has been hired by Walid Salamed from Standard Chartered MALAYSIA: Former director of Hong Deutsche Bank to head its corporate Bank and Fahad Al Khalifa are slated to Leong Islamic Bank and Hong Leong banking and securities operations in chair the newly-launched Qatar chapter Financial Group, Yvonne Chia, has been Malaysia. In addition to that, Yusof will while the Kuwait chapter will be led by appointed as a non-executive director act as Deutsche’s chief country offi cer for Rani Selwanes from NBK Capital. of pay-TV operator Astro Malaysia Malaysia. Holdings. National Bank of Kuwait KUWAIT: Ibrahim Dabdoub is set to retire as the group CEO of National Bank of Kuwait aft er 30 years of service with the bank.

AMAN UAE: Jihad Faitrouni has been reappointed as general manager of Dubai Islamic Insurance & Reinsurance (AMAN). He assumes the role from Musa Al Shawahin who has been named advisor to the board of directors.

National Bank of Adu Dhabi UAE: Bernard Shum has been conﬁ rmed as the head of corporate and institutional banking, Hong Kong by National Bank of Abu Dhabi (NBAD). Shum moves to NBAD Hong Kong from Hang Seng Bank, where he was deputy head of syndicated ﬁ nance, commercial real estate and corporate advisory.

SHUAA Capital UAE: SHUAA Capital has announced the departure of CEO Colin Macdonald as well as the appointment of chief fi nancial offi cer Houssem Ben Haj Amor as its general manager, Karim Schoeib as the chief executive of investment banking, Jennifer Adams as the director of operations and Michael Hewitt as the head of the executive offi ce. SHUAA

SHARIAH PRONOUNCEMENT

www.daralsharia.com Query:

The owner of a plot of land agreed with a contractor on the construction of a villa on the said land. The construction was to be done in ﬁ ve stages, and upon completion of each stage the land owner was to sett le the running bill representing the proportional construction cost aft er it was veriﬁ ed by the architect appointed by the owner.

Upon completion of the fourth stage and the sett lement of contractor’s running bill, the land owner approached an Islamic bank requesting a fi nancing facility to complete the fi ft h and fi nal stage (which had not yet started) as he had run out of cash. The owner off ered a mortgage over property and the assignment of rental on completion of the villa beside placing the property insurance in the bank’s name.

The bank is willing to help the owner and is seeking guidance from its Shariah board as to whether it can ﬁ nance a partially completed property.

Pronouncement:

In order to complete the remaining construction work, i.e. the ﬁ ft h stage in the above-mentioned situation, the Islamic bank may enter into an Istisnah contract with the land owner. However, this will require the termination of the existing contract between the land owner and the contractor.

Although the owner has sett led contractor’s bill relating to the fourth stage and the contractor has not yet started the ﬁ ft h stage, any liability resulting from premature termination of the agreement shall be borne by the land owner.

Pursuant to the termination of the existing contract, the bank will sign an Istisnah agreement with the land owner for the construction of the ﬁ ft h stage (the remaining portion of the villa). In terms of the Istisnah agreement, the bank will be the seller and the land owner will be the purchaser of the ﬁ ft h stage.

At the same time the bank will enter into a parallel Istisnah contract with any contractor (including the existing contractor), whereas the bank will be the purchaser and the contractor will be the seller.

The amount of the fi rst Istisnah contract signed by the bank with the land owner shall be higher than the amount of the parallel Istisnah contract the bank will sign with the contractor, the diff erence being the bank’s profi t. The amount of each contract will be payable as per the agreed payment schedule and all specifi cations and terms and conditions of both contracts shall be the same, except the delivery date which can be earlier in the parallel Istisnah contract compared to the main Istisnah contract signed by the bank with the owner in order to ensure timely delivery to the owner.

The following documents are needed to execute such a transaction: 1. Istisnah agreement (to be signed between the bank and the land owner); 2. Parallel Istisnah agreement (to be signed between the bank and the contractor).

Dr Hussain Hamed Hassan Chairman of the DIB Shariah Board, Managing director, Dar Al Sharia Legal & Financial Consultancy, Dubai, UAE

This Fatwa is brought to you exclusively by IFN in collaboration with Dar Al Sharia Legal & Financial Consultancy-Dubai. The Fatwa appearing in this space was obtained by Dar Al Sharia for issues faced by their clients and the documents stated in the Fatwa were developed at Dar Al Sharia. This Fatwa was compiled by Dr Muhiuddin Ghazi

Malaysian Sukuk outlook positive for 2014: Corporates to drive growth

The Malaysian Sukuk market had In its 2014 Local Fixed Income Market with minimum duration risk in this a challenging year in 2013, with a Outlook, Franklin Templeton notes in market condition,” confi rms Hanifah. subdued fi rst quarter and a cautious addition that the high foreign holding of stance from investors in the fi rst half government bonds (currently standing The overall default rate for Malaysian moving into more serious volatility above 40% despite an adjustment in mid- corporate credit as well as Sukuk from June following the revision of the 2013) indicates that foreign infl ows have remained low last year at below 5%, country’s sovereign rating to ‘negative’ been driven predominantly by the “easy with most issuers fi nancially sound, from ‘stable’ by Fitch Ratings due to money” policies in developed countries making the market an att ractive prospect. concerns over public fi nance and fears including the US, as they att empt to “As such, we believe that good quality over US tapering of its quantitative stimulate their way out of recession. This corporate credit is a good investment easing (QE) program. is a precarious position for Malaysia option in 2014 within the fi xed income as the situation has the potential to space,” she concludes. However, with the election jitt ers past, rapidly reverse which could hold serious a stable political climate, a focus on implications for the local bond market. In its 2014 Sukuk Outlook HSBC reducing fi scal defi cit and the 2014 Holdings, the biggest arranger of 2013, Budget reforms receiving a generally However, Hanifah confi rms that: “Bond also highlights that issuances from positive response from the investment yields have moved higher in 2013 and corporates seeking to cut fi nancing costs community, the market looks to be once have partially priced-in QE tapering risk could contribute to record Sukuk sales more on the up: refl ected in Moody’s already. We believe should our domestic this year. “In 2014, we will see a shift to upgrade of Malaysia’s sovereign outlook economic fundamentals perform well new issuers,” commented Mohammed to ‘positive’ in November. and surprise on the upside, this will help Dawood, the managing director of global to mitigate the risk of bond yields from capital fi nancing at HSBC Amanah. “We Hanifah Hashim, the executive director rising further in 2014, even with QE in will see a lot more coming out of Asia and head of Malaysia fi xed income store, as foreign investors will continue and a lot more issuance from outside of and Sukuk for Franklin Templeton to invest in the Malaysian bond market to the traditional markets.” Investments, nevertheless warns that seek higher return.” continued volatility should be expected Sukuk sales fell by approximately 9.5% as the market adjusts to the new fi nancial Ringgit-denominated Sukuk and in 2013 to US$42 billion according climate. “Looking ahead, we are at a stage corporate bonds are in fact expected to to Bloomberg; compared to a record where risk on-risk off trend becomes a perform bett er during this period of high US$46.4 billion in 2012. In a December norm in the fi xed income market as the volatility, due to the ample domestic 2013 report Moody’s estimated that world adjusts to the prospect that QE will liquidity levels able to support new 2014 could see sales hit a record US$60 not continue perpetually. Within this time issuances and short-term outfl ows. “We billion, driven by GCC and Malaysian frame, the bond market will be dott ed are keeping the local currency fi xed issuance. – LM with volatility along the way as it fi nds a income duration short and looking at comfortable level through this adjustment selected fi ve-year corporate credits as it period.” provides the best combination of yields

Maxis’ proposed Sukuk receives preliminary ratings

Malaysia’s telecommunications of all the fi nancial obligations on the in Malaysia are facing a deceleration provider, Maxis Communications, proposed Sukuk. Underpinned by strong in subscriber growth, moderate price ended 2013 by announcing its plans profi tability, RAM is confi dent of the competition and heft y marketing to raise approximately RM10 billion robust cashfl ow-generating ability of expenses that are compressing their (US$3.04 billion) via Sukuk. Expected Maxis. margins. Maxis recently appointed to carry a tenor of up to 30 years, Vodafone’s Morten Lundal as its new proceeds from the issuance will be For the fi nancial period ending 30th CEO in a bid to improve its sluggish used to refi nance the group’s current September 2013, Maxis’ earnings rose performance. borrowings and for working capital. 6.7% to RM474 million (US$144.18 The certifi cates will be issued by Maxis’ million) from RM442 million last year. Maxis is one of three major unit, BGSM Management. This was achieved on a revenue of telecommunications providers in RM2.24 billion (US$134.45 million), a 1% Malaysia. It last tapped the Sukuk RAM has assigned a preliminary rating accretion from RM2.21 billion (US$672.26 market in February 2012, issuing a of ‘AA3/stable’ to BGSM’s proposed million) previously. The company’s profi t RM2.45 billion (US$745.27 million) Sukuk Sukuk Musharakah program. RAM’s before tax increased 5.53% to RM667 Musharakah under an unrated Islamic analysis is focused on Maxis (its sole million (US$202.89 million). In spite medium-term notes program. – NA operating subsidiary) as it is the BGSM’s of the high mobile penetration rate of only source of cashfl ow for the fulfi lment 146.1%, telecommunication companies

Cross-border skills and knowledge exchange: On the increase

Sett ing up a fi nancial institution Pending a license from the central bank predicted to chart an upward trend in the requires considerable eff ort from and expected to launch within the next coming years. many fronts: from establishing the six months, the proposed private Islamic framework of the entity to recruiting the bank will be a culmination of strategic “We are observing a cross-pollination right people and procuring suffi cient cross-border eff orts between Mauritius- of skills and knowledge that has started funds as well as meeting regulatory based Ethical Finance (EFL) and Meezan to benefi t the industry, and we expect requirements. However, several bankers Bank. Following an MoU in November this trend to grow in the future,” said an have recently conveyed to Islamic last year, the latt er will provide EFL offi cial from the product development Finance news that the main challenge in with the necessary guidance on product and Shariah compliance department at sett ing up a new institution is the actual development, Shariah-related technical Meezan Bank to Islamic Finance news. implementation of Islamic banking services and training. products on the ground: maintaining Poised for a positive trajectory in 2014 business viability and customer Cross-jurisdiction partnerships and with estimates reaching the US$2 approachability without compromising collaboration in terms of exchanging trillion mark, the Islamic fi nance on Shariah principles. skills and knowledge to propagate the industry can anticipate new entrants industry forward have been prevalent this year as well as stronger synergy This is the challenge that Meezan within the relatively nascent Shariah between players from diff erent sectors Bank foresees for the fi rst dedicated fi nancial landscape, as demonstrated by across borders. – VT Islamic retail bank in Mauritius, which Meezan Bank (which provided similar the Pakistan-based bank has been services to Amana Bank, Sri Lanka’s commissioned to assist in establishing. fi rst commercial Islamic bank), and are Regulatory revisions for the new year

Over the fi nal quarter of 2013 a fl urry GCC: Across the GCC, regulatory hopes the regulations, which treat Sukuk of regulatory updates were announced announcements have been made and conventional bonds separately for across multiple Islamic fi nance aiming at increasing the transparency the fi rst time, will encourage the growth jurisdictions. Islamic Finance news of fi nancial systems across its markets. of the domestic credit market and the brings you a run-down of the key Bahrain has introduced a new banking sale of Sukuk; and aims to have the new changes across the global markets. regulation requiring the public disclosure framework enacted in early 2014. of the risk profi le, risk management and North Africa: At the start of December capital adequacy and other specifi cs of Asia: In Indonesia, the authorities Libya’s national assembly, the General fi nancial institutions, as a step towards announced new policies to be introduced National Congress, voted to install the incorporation of Basel III measures in 2014 in an att empt to boost the Shariah law as the basis for all legislation. to the country’s fi nancial regulatory country’s fl agging Islamic fi nancial sector. While the reason for the decision is framework. This has been followed by Shariah compliant assets in the republic believed to have been political – an new regulations issued by the Bahrain are estimated to grow between 19-29% in att empt by the moderate temporary central bank in the new year regarding 2014, almost half of the 34.1% growth of Libyan government to out-maneuver the off ering of securities and Sukuk. The 2012. Initiatives include the regulation of those in the country trying to accuse regulator aims to facilitate the integration foreign exchange markets, introduction the government of being ‘un-Islamic’ – of GCC securities markets by accepting of Islamic repurchase agreements and Islamic fi nance is nevertheless likely to applications from issuers in other GCC education and awareness programs. benefi t from the decision, as a special countries, prepared in accordance with committ ee has been convened to examine GCC Unifi ed Standards. In December, the Malaysia-based Islamic the Shariah compliance of Libya’s existing Financial Services Board (IFSB) also laws. This could lead to the instigation of In October, the Central Bank of Bahrain published guidelines on capital adequacy more stringent regulations for the Libyan introduced improved regulations on the for Islamic fi nancial institutions and Islamic fi nancal sector – much like Egypt, operational and solvency framework for Takaful risk management detailing the which in December also announced Takaful and re-Takaful and distributed the criteria for using Sukuk as Tier 1 and Tier 2 impending plans for regulatory changes. framework to the industry for consultation regulatory capital; followed by the issuance The country’s fi nancial regulator plans and review. Feedback was requested for of new guidelines for Islamic securities to submit a proposal for a new capital November and the new regulations were by Labuan Financial Services Authority. market law that will also facilitate the scheduled to be implemented by the end The guidelines issued by the regulator issuance of Sukuk. Egypt’s previous of 2013. At the same time, the Securities deal with both Islamic and conventional plans to introduce laws regulating the and Commodities Authority (SCA) in the securities and came into force on the 1st issuance of Sukuk were held up due to UAE distributed draft regulations dealing January 2014. The new year should also concern from the country’s politicians with the separate treatment of Sukuk and bring guidelines from the Shariah Advisory and Islamic scholars regarding the conventional bonds to the industry and Council of Bank Negara Malaysia, which seizure of sovereign assets by foreign requested feedback, as the fi nal stage of has announced plans to issue a Shariah investors in the event of a default. consultation on new debt issuance and standard on Ijarah within the fi rst quarter listings regulations for the UAE. The SCA of the year. – RS

Syria: A country in crisis

Islamic banking was introduced in Syria in 2005, but the positive developments seen in its fi nance sector have been largely undone as a repercussion of the civil war and subsequent unrest that has aff ected the country since 2011. REBECCA SIMMONDS examines the state of the Islamic fi nance industry in a country that continues to struggle with severe political and social troubles.

Legal and regulatory Takaful operations exist in Syria: with US$2 billion on aid. In December 2013, a The establishment of Islamic banks Damascus-based Al-Aqeelah Takaful telethon for the Emirates Red Crescent’s in Syria via Legislative Decree 35 in practicing with two offi ces in Syria as the Our Hearts Are With the Syrian People 2005 was a government response to fi rst and largest Takaful company. Al- campaign raised over AED120 million the demand for Islamic fi nancing by Aqeelah is joined by Aman Syria, Noor (US$32.66 million) including AED10 Syrian businesses and was followed by Takaful and Syrian Islamic Insurance million (US$2.72 million) donated by the introduction of private banks and Company. the Dubai Islamic Bank Humanitarian the opening of the Damascus Securities Foundation and AED1 million each Exchange in March 2009. The government International sanctions (US$272,183) from Al Ansari Exchange established a requirement for Islamic In May 2012, sanctions were imposed and Al Hilal Bank. Syria’s membership of banks to have a Shariah Supervisory against the Syria International Islamic the IDB has been temporarily suspended, Council to oversee the operations of the Bank (SIIB), banning the bank from but the bank has agreed to provide aid banks and ensure their adherence to fi nancial and commercial systems to Syrian refugees within the limits of its Shariah law. The banking laws in Syria as a result of providing services and humanitarian fund. The Syrian National as they relate to Islamic fi nance broadly acting on behalf of the Commercial Coalition, a collaboration of opposition follow the laws as established in countries Bank of Syria and the Syrian Lebanese groups founded in November 2012, with a functioning Islamic fi nance Commercial Bank, both of which were has been recognized by 20 countries market, such as Malaysia, and take on subject to sanctions imposed by the including the GCC, the Arab League, and board the regulatory edicts of AAOIFI international community including Turkey as the representative of the Syrian and the IFSB. the US government, the EU and people; and several countries, including the Arab League. Between 2011-12, Kuwait, Qatar, Saudi Arabia and the the SIIB facilitated fi nancing worth UAE have provided funding and aid Banking and finance through the coalition. There are 12 privately owned banks in approximately US$150 million on behalf Syria, of which three are Islamic banks: of the Commercial Bank of Syria. The Cham Bank, which opened in 2006; Syria original sanctions against the two non- Challenges International Islamic Bank, which opened Shariah compliant banks were imposed Independent think tank, Atlantic Council, in 2007; and Al Baraka Bank, which due to their support of entities related estimates that the real GDP of Syria opened in 2008. In addition to retail to the propagation of weapons of mass fell between 50-80% in 2012, with the services, following case-by-case approval destruction in Syria and North Korea. Syrian pound (SYP) at one-sixth of its from the central bank, Islamic banks value against the dollar since 2011 and in Syria are permitt ed to participate Syria’s membership to the Organization foreign currency reserves estimated to in syndicated loans with conventional of Islamic Cooperation (OIC) was be between US$2-5 billion, down from banks, as long as Shariah principles are suspended in August 2012, and the US$18 billion in 2011. The government adhered to in all aspects of the deal. Arab Nations also suspended Syria’s is now receiving credit from Iran, membership and imposed sanctions Russia, and China — countries that have The banks in Syria have had to prepare against the country including the halt of remained allies of the current embatt led for worst-case scenarios, with profi ts fi nancial dealings and trade agreements, political regime. The country’s economy falling by 40-90% in 2012 as the the freezing of the Syrian government’s has contracted due to the imposed shockwaves from the country’s civil bank assets and a suspension of fi nancing international sanctions resulting in war reverberated through the fi nancial to new projects in Syria. In 2011, Turkey reduced domestic consumption and sector. Banking transactions such as also ended its relationship with the production: with a sharp growth in trade fi nance and corporate lending have central bank of Syria, stopping all credit infl ation and the loss of over 2.3 million particularly suff ered, although basic to the government and freezing a prior jobs. banking services have been maintained credit agreement to provide support for despite the diffi cult environment. In Syrian infrastructure projects. Outlook September 2012, Syria International Many countries and multilateral Islamic Bank reported a robbery in International aid organizations have voiced their Homs, resulting in the loss of SYP75.2 Syria’s Islamic neighbors have been concern for the situation in Syria and million (US$532,201). Businesses have campaigning and providing aid. At shown support for the Syrian National been aff ected as international sanctions the start of 2014, Turkey launched a Coalition, but the confl ict has yet to be have been implemented against those campaign led by the prime ministry’s resolved meaning that the outlook for the believed to be affi liated with the Disaster and Emergency Management country’s Islamic banking sector is also government’s regime. The IMF has not Directorate (AFAD) to aid Syrian uncertain. provided fi gures on the Syrian economy refugees; Turkey is currently hosting since the start of the civil unrest. 210,000 Syrian refugees, and has spent

A new year for Islamic debt capital markets

The Islamic debt capital market covers multiple asset classes including asset-backed fi nancing, capital loans, repos, term fi nancing, Sukuk and syndicated fi nance. While some areas (such as asset-backed fi nancing and repos) are still small, sectors such as Sukuk and syndicated fi nancing have found a keen and growing audience around the world. REBECCA SIMMONDS explores the current state of the market.

Key markets Significant deals and Samba Financial Group and the The total number of Sukuk and Islamic One of the most anticipated issuances syndicated fi nancing deal for Emirates loans issued in 2013 according to data of 2013 was the fi rst Sukuk issued by Aluminium which was the biggest of provided by dealogic is 119. Domestic the Kuala Lumpur-based International the year, at US$3.40 billion. The best- issuances still make up almost 90% Islamic Liquidity Management performing Islamic syndicated fi nance of the Sukuk market, reportedly at a Corporation (IILM), an international deal of 2013 in the GCC was the Jebel Ali total of US$66.6 billion for the fi rst nine institution to create and issue short-term Free Zone FZE Sukuk, which gained a months of 2013, but countries that have Shariahcompliant fi nancial instruments 4.3% return: beating the regional average been highlighted as key markets such to facilitate eff ective cross-border Islamic return of 9bps by over four times. as Malaysia, Saudi Arabia and Dubai liquidity management. The Sukuk was are increasingly aiming to issue more issued at US$490 million with a three New markets international Sukuk. Malaysia’s position as month tenor and an ‘A-1’ rating from Whilst the established markets engage in the global leader in the Sukuk market was S&P. A deal that captured the headlines competition to see who will become the confi rmed, with the country accounting in the second half of 2013 was Qatari undisputed global hub for Islamic fi nance, for US$54.33 billion of the US$75 billion of telecommunications provider Ooredoo’s there is a level of interest in discerning new Sukuk issued globally over the course US$1.25 billion fi ve-year Sukuk. where the next emerging markets will be. of the fi rst nine months of 2013 and 63.6% Expert opinion has identifi ed frontrunners of the total Sukuk outstanding globally, as in Turkey, Indonesia and Nigeria. With its at the end of August 2013, to the value of Industry debut sovereign Sukuk issuance in 2012 US$275.20 billion. and a follow up of US$1.25 million which professionals was 6.2 times oversubscribed, Turkey has Sukuk issued in 2013 in the GCC totalled entered onto the scene with confi dence. US$21.1 billion, including market predict that new North African countries such as Morocco drivers Saudi Arabia (which issued and Tunisia have been tipped as prospects US$8.69 billion in the fi rst nine months issuers will be to watch by industry heavyweights - the of the year) and the UAE (which issued IDB off ered to subscribe to Morocco’s fi rst US$5.17 billion over the same period). encouraged by the sovereign Sukuk rather than arrange a loan Oman approved the fi rst Sukuk issuance in 2013 and Tunisia has been mooted as in the country in June 2013, for OMR50 potential presented an Islamic fi nance hub for Francophones. million (US$129.45 million). The GCC Of the Sub-Saharan African countries, outperformed other countries in the 2013 in the Sukuk market Nigeria’s Osun state has beaten the syndicated fi nance market, with eight of Nigerian government to the issuance of the the ten top deals of the year occurring in if non-traditional fi rst Sukuk in the country, raising NGN10 either Saudi Arabia or the UAE; leading billion (US$62 million) with its deal. the fi eld with over US$7 billion worth of assets can be utilized fi nancing. This included a US$1.75 billion in this fashion Outlook equivalent dual currency syndication for The Sukuk market in 2013 was subject to Dubai Duty Free and a US$2.55 billion more caution in the market – primarily equivalent dual currency syndication for due to uncertainty regarding the the Investment Corporation of Dubai, The company’s fi rst foray into the Sukuk timetable for the US Federal Reserve’s facilitated by Dubai Islamic Bank. market, the deal was part of a US$2 decision on tapering of its stimulus billion program, and was signifi cant program. Data suggests that 2014 will see Up and coming asset classes include as the fi rst globally issued US dollar- signifi cant quantities of Sukuk maturing, Islamic repurchase agreements (repos), denominated Sukuk using airtime as which experts have predicted will lead currently a small but growing market, its underlying profi t asset. Industry to new issuances with longer tenors - with more transactions in the 2011 than professionals predict that new issuers moving up from fi ve years to seven years in the whole of the past decade. Asset will be encouraged by the potential and encouraging entry to the market backed aviation fi nancing is an area presented in the Sukuk market if non- from new issuers, with the gap between that is also set to grow in 2014 as banks traditional assets can be utilized in this Sukuk supply and demand expected in the Middle East prepare to fi nance fashion. The GCC led in syndicated to peak this year. Given that a timetable the region’s airlines, following a spate loans in 2013, with deals such as the has been set for the tapering of the US of plane orders at the Dubai airshow ACWA Power SAR1.77 billion (US$471.84 Federal Reserve stimulus, new issuers last year. Shariah compliant fi nancing is million) corporate facility funded from Asia and outside of traditional expected to play a large role in covering by Banque Saudi Fransi, National Sukuk markets are expected to add to the the orders worth US$160 billion. Commercial Bank, Saudi British Bank growth in sector.

Shariah compliant technology stocks

The demand for Shariah compliant stocks has increased tremendously since the inception of the Islamic ﬁ nance industry, both from retail and institutional investors. Although in the early days it was diﬃ cult for investors to determine how to invest in Shariah compliant stocks and earn Halal income, the AAOIFI Shariah standards for stock exchanges have since allowed the construction of Islamic indices. SAAD NAQI KHAN questions how technology stocks are now screened to be Shariah compliant?

A subsidiary of McGraw Hill There are two screens employed by Yasaar Company, which employs similar Companies, Dow Jones established Shariah screening companies — business business screen but is quite diff erent in its fi rst Islamic Index way back in the and fi nancial screening. The fi rst ensures the fi nancial aspect. Total assets are used 1990s with the aim of providing a list that the overall business of a fi rm is not in the denominator instead of average of investible equities that pass screens in contradiction with the Shariah rulings. market capitalization in the gearing ratio; for Shariah compliance. Islamic indices The business screens only consider while in the cash fl ow ratio, receivables also serve to provide a defi nitive those businesses that are considered to are also included with the threshold standard for measuring stock market be in line with the teachings of Islam, mark of 50%. While using total assets performance for Islamic investors on therefore exclude all the stocks that lie instead of market capitalization in the the global basis in accordance with the in impermissible sectors like fi nancials FTSE screening formula is the primary established index methodology. (except Islamic banks and other fi nancial diff erence, FTSE also does not allow institutions such as Takaful companies screening tests to be based on market As of today, numerous Shariah screening and Islamic asset management companies expectation rather than on true worth methodologies have been developed by etc.), alcohol, weapons manufacturing, of assets, therefore considered in the index providers around the world to gambling and gaming, entertainment denominator. In case of DJIM, higher construct, maintain and market ‘Islamic (including but not limited to market capitalization resulting from indices’ based on business and fi nancial pornography), Halal foods such as pork, bett er performances would lead to lower screenings. tobacco, insurance brokers, hotels etc. fi nancial ratios and eff ectively become an expectation factor in the screening tests. Recently two hot IPOs of technology The fi nancial screens employ several stocks have taken place: Facebook and fi nancial ratios which can vary across There are other leading Shariah screening Twitt er. Many investors were surprised individual indices. However the basis is methodologies including Malaysia’s that both stocks are considered Shariah usually similar. Shariah screening methodology, the compliant based on several screening recently launched NASDAQ 100 Shariah methodologies adopted around the world. The fi nancial screens are based on a Index. Moreover, Russell Investment Twitt er fulfi lled all the requirements number of fi nancial ratios. The most Group and Jadwa Investment of Saudi of renowned Shariah stock screening frequently used fi nancial ratios are the Arabia launched an Islamic index in methodologies, while other technology following: 2009; with business screens mostly giants including Facebook and Google are • Gearing ratio: Total interest-bearing similar in each methodology but with also considered Shariah compliant and debt divided by market capitalization certain exceptions in fi nancial ratios. are included in diff erent Shariah indices. of the company Stocks from Apple were also considered • Liquidity ratio: Cash plus interest In Pakistan Al Meezan, the largest Islamic Shariah compliant until revenue from bearing securities divided by market asset management company in the the music segment (iTunes — which is capitalization country, established KSE-Meezan Index prohibited as a part of entertainment) • Cash fl ow ratio: Receivables divided (KMI-30) — a collaboration between Al exceeded the 5% threshold limit. by market capitalization Meezan Investment Management and the • Income ratio: Impermissible income Karachi Stock Exchange, in consultation Before gett ing into details of the divided by total income with the parent company which saw underlying factors of Shariah screening the development of detailed guidance methodologies, one should understand The DJIM is considered to be the on fi nancial ratios and business screens. that technology stocks in the bourses premiere Islamic index, and considers However, the latt er remains the same in of the US are frequently traded and all the above fi nancial ratios including most Shariah screening methodologies. essentially allow Muslim investors to earn gearing ratio, liquidity ratio and cash Halal income while enabling investors fl ow ratio. It is recommended that the It is important to conclude that the to understand the basis of being Shariah resultant of above ratios should be within responsibility rests with the traders/ compliant and explore the available 33% to be deemed Shariah compliant. brokers to provide information to retail opportunities to earn legitimate income DJIM considers 24 months average investors and institutional investors according to the teachings of Islam. market capitalization in the denominator. about the 5% limit on income ratio to However, investors are suggested to ensure that non-compliant income does Several companies have established Shariah apply an income ratio of 5% incase of not become part of the income. screening methodologies: including the above stated companies. Dow Jones Islamic Index (DJIM) family, Saad Naqi Khan is the audit offi cer at Meezan FTSE, MSCI, Russell Jadwa, KMI etc, mainly FTSE has also established Shariah Bank. He can be contacted at saad.khan@ based on the guidelines of AAOIFI. screening criteria in collaboration with meezanbank.com.

IFN Country Correspondents Ending 2013 on a strong note AFGHANISTAN: Zulfi qar Ali Khan head of Islamic banking division, fi nancial supervision department, Da Afghanistan Bank QATAR intended for monetary and liquidity AUSTRALIA Talal Yassine, managing director, Crescent Wealth management. BAHRAIN: Dr Hatim El-Tahir By Amjad Hussein director, Islamic Finance Knowledge Centre, Deloitt e & Touche Masraf Al Rayan (MAR), Qatar's largest BANGLADESH: Md Shamsuzzaman In order to further the goals of Qatar's executive vice president, Islami Bank Bangladesh Islamic bank by market value, has BELGIUM: Prof Laurent Marliere Vision 2030, the Qatar Central Bank CEO, ISFIN made inroads into the UK by recently (QCB) announced earlier this month BERMUDA: Belaid A Jheengoor agreeing with the Islamic Bank of Britain director of asset management, PwC its program until 2016 to consolidate BRUNEI: James Chiew Siew Hua (IBB) the terms of a cash off er for IBB's senior partner, Abrahams Davidson & Co regulatory oversight over the banking entire capital. MAR reportedly off ered CANADA: Jeff rey S Graham sector, the fi nancial markets and the partner, Borden Ladner Gervais GBP24.1million (US$39.56 million) in CZECH REPUBLIC: JUDr Ivana Hrdlickova, insurance sector. The plan highlights judge, Judiciary, Appelate Court Pardubice cash for the acquisition of IBB’s shares. EGYPT: Dr Walid Hegazy Islamic fi nancial institutions as a crucial managing partner, Hegazy & Associates component of the growth of Qatar's FRANCE: Kader Merbouh Moody’s has assigned a fi rst-time ‘Baa2’ co head of the Executive Master of the Islamic Finance, economy and seeks to enhance their role Paris-Dauphine University insurance fi nancial strength rating to and contribution to its development. HONG KONG & CHINA: Anthony Chan Qatar-based Damaan Islamic Insurance New Line Capital Investment Limited Company (Beema) with a stable outlook. INDIA: H Jayesh The QCB also announced that it is founder partner, Juris Corp Established in 2009, Beema is a Shariah INDONESIA: Farouk A Alwyni developing rules for the listing of chairman, Center for Islamic Studies in Finance, compliant insurance service provider. Economics, and Development exchange-traded funds (ETFs) on the IRAN: Majid Pireh It writes a mix of non-life, health and Qatar Exchange (QE) and has also Islamic fi nance expert, SEO Takaful life insurance. Qatar Insurance IRAQ: Khaled Saqqaf hinted at plans to improve the sharing partner and head of Jordan & Iraq offi ces, Al Tamimi & Co Company, Qatar Islamic Bank and MAR, IRELAND: Ken Owens of credit rating information by widening Shariah funds assurance partner, PwC Ireland Barwa Real Estate and QInvest are the access to information from its credit JAPAN: Serdar A. Basara major stakeholders of the company. president, Japan Islamic Finance JORDAN: Khaled Saqqaf bureau to entities such as the QE and partner and head of Jordan & Iraq offi ces, Al Tamimi & Co telecommunications companies. The KENYA: Bilal AbdulAziz Laving QInvest, a leading Islamic investment head of product development and Shariah compliance, credit bureau is a division of the QCB Gulf African Bank bank in Qatar, expects 2014 to be responsible for assessing borrower KOREA: Yong-Jae Chang another busy year. In 2013 QInvest partner, Lee & Ko creditworthiness and for providing KUWAIT: Alex Saleh acted on Sukuk transactions totaling partner, Al Tamimi & Company creditworthiness reports on customers LUXEMBOURG: Marc Theisen US$3.5 billion including acting as partner, Theisen Law to banks. The QCB said it will launch the joint lead manager and bookrunner MALDIVES: Aishath Muneeza second phase of the credit bureau project head of Islamic fi nance, Capital Market Development for Ooredoo’s fi rst ever Sukuk, worth Authority for telecommunications companies MALTA: Reuben Butt igieg US$1.25 billion, which was also the fi rst president, Malta Institute of Management and connect the banking risks system MAURITIUS: Sameer K Tegally US dollar Sukuk issued globally using to the Ministry of Justice’s real estate associate, Conyers Dill & Pearman an innovative airtime structure. QInvest MOROCCO registration department and QE to allow Ahmed Tahiri Jouti, senior consultant, Al Maali Islamic acted for Turkey as joint lead manager Finance Training and Consultancy for easier verifi cation of guarantees NEW ZEALAND: Dr Mustafa Farouk and bookrunner on the sovereign’s counsel member for Islamic fi nancial institutions, FIANZ provided by borrowers. NIGERIA: Auwalu Ado second Sukuk worth US$1.25 billion. In Shariah auditor, Jaiz Bank May, QInvest was also one of the joint OMAN: Riza Ismail, senior associate, Trowers & Hamlins lead managers for Saudi Arabia-based PAKISTAN: Muhammad Shoaib Ibrahim Qatari banks developer Dar Al Arkan’s US$450 million managing director & CEO, First Habib Modaraba PHILIPPINES: Rafael A Morales Sukuk, an off ering from an issuer that managing partner, SyCip Salazar Hernandez & Gatmaitan reported the QATAR: Amjad Hussain provides diversity to Sukuk investors partner, K&L Gates RUSSIA: Roustam Vakhitov being a rare sub-investment grade Sukuk. managing partner, International Tax Associates highest year-on- SAUDI ARABIA: Nabil Issa partner, King & Spalding Finally, according to a report by Global SENEGAL: Abdoulaye Mbow year growth in net Investment House, Qatari banks Islamic fi nance advisor, Africa Islamic Finance Corporation SOUTH AFRICA: Amman Muhammad reported the highest year-on-year CEO, First National Bank — Islamic Finance interest income (NII) SINGAPORE: Yeo Wico growth in net interest income (NII) in partner, Allen & Gledhill the GCC at 25.3%. Notably MAR's NII SRI LANKA: Roshan Madewala in the GCC at director/CEO, Research Intelligence Unit rose 35.3% due to a 26bps year-on-year SWITZERLAND: Khadra Abdullahi improvement in its net interest margins associate of investment banking, Faisal Private Bank 25.3% TANZANIA: Khalfan Abdallah and Qatar National Bank also saw head of product development and Sharia compliance, Amana Bank robust growth of 28.1% in NII driven THAILAND: Shah Fahad Yousufzai, vice-president and head of strategic marketing and product development, by consolidation of its Egypt-based Islamic Bank of Thailand The QCB in December issued subsidiary National Societe Generale TUNISIA: Karim Amous government bonds and Sukuk for Managing partner, Smarteco IFN Correspondents Bank-Egypt. TURKEY: Ali Ceylan are experts in their partner, Baspinar & Partners respective fi elds national banks for a period of three and are selected years and fi ve years with a total value UAE: Moinuddin Malim by Islamic Finance Amjad Hussain is a partner at law fi rm K&L CEO, Mashreq Al Islami news to contribute of QAR4billion (US$1.09 billion).The UK: Siraj Ibrahim designated short Gates’ corporate and fi nance practices. He corporate fi nance manager, country reports. For government has signaled however QIB UK more information can be contacted at Amjad.Hussain@klgates. US: Joshua Brockwell, about becoming an that Qatar is unlikely to issue debt on investment communications IFN Correspondent com. director, Azzad Asset please contact international markets in 2014 and that Management sasikala@ YEMEN: Moneer Saif redmoneygroup.com any issued debt in 2014 will only be head of Islamic banking, CAC Bank

Limitations introduced on credit card installments and loan amounts

TURKEY the vehicles valued at TRY50,000 published on the Offi cial Gazett e dated (US$22,930.5) or less concerning the the 30th December 2013 and numbered By Ali Ceylan vehicle loans granted to the customers 28867. The increased taxes are in a for automobile purchases and loans wide range from valuable papers to Turkey has introduced limits on debit granted against vehicle pledge or at motor vehicle tax. Most of the taxes and credit card installments and the fi nancial leasing transactions. This are increased by 3.93%, named as the bank loan amounts for the purposes percentage shall be applied as 70% to “revaluation rate” determined in the Tax of avoiding redundant consumer the fi rst TRY50,000 for vehicles valued at Procedure Law. spending. The changes on credit cards more than TRY50,000; and as 50% for the were published in the last Offi cial exceeding amount. One of most recent developments in the Gazett e of 2013, dated the 31st December fi nancial sector is the communiqué on 2013 and numbered 28868. As per the Limitations on consumer loans have real estate investment funds published in amendment made on the communiqué also been introduced through the the Offi cial Gazett e dated the 3rd January regarding debit and credit cards, the amendments made on the communiqué 2014 and numbered 28871. According to maximum installment quantity is nine regarding bank loan transactions. the communiqué, real estate investment while purchasing goods or services. According to the new form of the funds are not authorized to deal with This limitation is also applicable for the communiqué, consumer loan maturity any other transaction except than the cash withdrawals made by using credit term cannot exceed 36 months, and management of the portfolio consisted of cards. cannot exceed 48 months for the loans the assets and transactions stated in the granted for vehicle purchases. However, communiqué. It is another requirement While the installment quantity is these limitations are not applicable for the fund to have real estate limited to nine for ordinary good or for the loans granted for real estate investments equal to at least 80% of the service purchases, consumptions for purchases. fund’s total value. The fund value shall telecommunication, jewellery, food and reach at least TRY10 million (US$4.59 oil are completely prohibited. It should be noted that all of the above- million) within one year following the mentioned changes on the credit card date when sale of the participation shares In addition to the above-mentioned installments and bank loans will become to the qualifi ed investors begin. It should limitation on credit cards, another eff ective as of 1st February 2014. be noted that the communiqué will enter regulation change is made on the into force as of the 1st July 2014. communiqué regarding bank loan In addition to the changes made transactions. The change is published concerning credit cards and bank loans; a Ali Ceylan is a partner at Baspinar & on the same Offi cial Gazett e mentioned considerable number of tax amounts are Partners. He can be contacted at ali.ceylan@ above. As per the amendment: credit increased through general communiqués baspinar.av.tr. percentage shall not exceed 70% for

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2014: The year for Takaful? IFN Sector Correspondents ASSET MANAGEMENT TAKAFUL government of Dubai to enhance the Sean Daykin, head of investment funds, Emirates NBD Asset Management operational and legal conditions relating By Rima Mrad CROSS-BORDER FINANCING: to the industry and making it more Fara Mohammad, senior lawyer and consultant in Islamic competitive and reliable. fi nance The end of 2013 witnessed the DEBT CAPITAL MARKETS: announcement of a groundbreaking Muhammad Shoaib Ibrahim, managing director & CEO, We are looking forward to witnessing the First Habib Modaraba decree by Sheikh Mohammed bin development of the Shariah compliant LAW: Rashid Al Maktoum, the ruler of Dubai, Bishr Shiblaq, head of Dubai offi ce, Arendt & Medernach fi nance sector during the course of 2014 regarding the creation of the Dubai LEASING: in the UAE due to this unprecedented Professor Dr Shahinaz Rashad, chairperson & CEO, Islamic Economy Development Center. Egyptian Leasing Association commitment from the ruler of Dubai This center constitutes a part of Dubai’s MICROFINANCE (ASIA): to further focus on this sector of the overall ambition to establish itself as a Dr Mahmood Ahmed, executive vice president and fi nancial industry and support Dubai to director training, Islami Bank Training and Research global hub for the Islamic economy. Academy grow and compete with the international MICROFINANCE (AFRICA): Islamic capitals such as London and Mansour Ndiaye, director of microfi nance, Assistance and Kuala Lumpur. Consulting for Development PRIVATE BANKING & WEALTH MANAGEMENT We are Khadra Abdullahi, associate, investment banking, Faisal Apart from the above and in terms of Private Bank expecting the particular legal changes relating to PRIVATE EQUITY & VENTURE CAPITAL: the Takaful industry, we are expecting Arshad Ahmed, partner, Elixir Capital REAL ESTATE (EUROPE) the UAE Insurance the UAE Insurance Authority to issue in Philip Churchill, founder partner, 90 North Real Estate the fi rst half of 2014 the new prudential Partners Authority to issue in regulations tailored for Takaful, REAL ESTATE (MIDDLE EAST): Yahya Abdulla, head of capital markets — Middle East, including capital adequacy calculation, Cushman & Wakefi eld the first half of 2014 technical provisions, solvency margins REGULATORY ISSUES (ASIA) and investments parameters. These Intan Syah Ichsan , chief operating offi cer, Samuel Aset the new prudential Manajemen regulations are expected to enhance REGULATORY ISSUES (MIDDLE EAST): the foundation of the stable and strong Mohammad Abdullah Malik Dewaya, head of Shariah regulations Takaful operators with sound fi nancial compliance and audit, Maisarah Islamic Banking Services abilities. They will also fi ll a huge gap in RETAIL BANKING: tailored for Takaful, Ris Rizqullah, lecturer, Trisakti University the existing overall insurance laws and RISK MANAGEMENT: regulations that are considered one of Abu Bakr Abdel Rahman, relationship manager, NBD- including capital the main reasons behind the diff erent ADIB SECURITIES & SECURITIZATION: adequacy calculation, shortfalls in the performance of the Nidhi Bothra, executive vice president, Vinod Kothari Takaful operators in the UAE. Consultants STOCK BROKING & TRADING: technical provisions, Athif Shukri, research analyst, Adl Capital On another note, preparations have SUKUK solvency margins now started for the next World Takaful Marco Mauri, senior director of asset management, Conference, due to take place in April Alkhair Capital Saudi Arabia 2014, which will gather a number TAKAFUL (UAE) and investments Rima Mrad, Partner, Bin Shabib & Associates of major Takaful and conventional TAKAFUL & RE-TAKAFUL: parameters companies. Topics of discussions during Dr Sutan Emir Hidayat, senior lecturer, University College this event will include major critical of Bahrain TREASURY PRODUCTS: challenges and prospects facing the Nafi th ALHersh Nazzal, certifi ed fi nancial & investment Takaful industry and the ways to address advisor such challenges with more effi ciency. TECHNOLOGY: This announcement will have a direct Syed Mohammad Ali, Islamic fi nance consultant, impact on the diff erent sectors of the Miraipod Inc Rima Mrad is a partner at Bin Shabib & IFN Correspondents are experts in their respective fi elds Islamic fi nance industry, including and are selected by Islamic Finance news to contribute Associates. She can be contacted at rima. designated short sector reports. For more information Takaful. It is a commitment from the about becoming an IFN Correspondent, please contact [email protected]. [email protected]

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Asset management and Chit funds

Chit funds are classifi ed as ‘miscellaneous non-banking fi nancial institutions’ under the Reserve Bank of India Act 1934, and played a major role in the National Financial Inclusion Program even before the evolution of the country’s banking sector. ASIF ULLA KHAN discusses the unique role they continue to play in the Indian fi nancial system.

The Chit fund system, with numerous known as ‘Kye’. In Zimbabwe, 76% of total amount. The successful bidder is in-built advantages including easy urban market traders participate in chit one who gives the highest bid amount, accessibility, user friendly services etc., funds while in Egypt they also seem to be not exceeding the maximum limit, within and which is also free of latent cost and very popular among bank employees. the speciﬁ ed auction time. Suppose the periodic interest hikes or exorbitant winning bidder bids for US$2,000, he pre-closure charges, is the preferred The earliest systems of chits made use of would get this amount and the rest of the option for those who plan to save lots. Currently, the systems of auctioning amount (i.e. US$500) is divided among small amounts. Chit funds are a saving and tendering are also in practice. the 25 members. This discount of US$20 cum borrowing instrument, which Following the chits based on the lot (i.e. 500/25) is then returned back to each are unique when compared to other system makes it permissible in the light member. So the next month’s contribution ﬁ nancial products. of Shariah. would be US$100- US$20 =US$80.

Cash fl ows are the lifeline of The ‘foreman’ or the company or This process gets repeated for all months business — big or small. Usually big person conducting the chit fund brings till the end of the scheme, giving each businesses manage to meet their capital people together and conducts the chit member a chance of receiving the money. requirements with the help of banks fund. The foreman is also the person If in a particular month there is more and other formal fi nancial channels. responsible for collecting the money from than one person willing to take the sum, Banks extend timely support to big subscribers, presiding over the lots and a lot is taken to declare the person who enterprises and it is a win-win situation keeping records of subscribers. He is would get the sum. for both parties. Small businesses are compensated a fi xed amount (generally traditionally avoided by banks and 5% of the gross chit amount) monthly for A major drawback is that chit funds do formal financial institutions because his eff orts. Other than that the foreman not off er any pre-determined or fi xed of their accounting procedures, lack of does not have any specifi c privileges. returns. Higher returns are earned when proper record-keeping and inability to there are more members in the group or provide satisfactory security. They have The foreman has to deposit 100% of the if the duration of the scheme is longer. been historically wedged between the chit value before the start of the new chit One would earn more when more moneylenders, with their exorbitant as fi xed deposit with the bank as per the members need emergency funds. Thus cost of loans; and banks, with their Chit Funds Law. The commission that returns cannot be calculated and decided stringent procedures. Chit funds are a can be charged by the foreman is 5% of when one joins the scheme. more suitable financing model for small the chit value for the subscribers. businesses mainly because they do not With the plethora of chit fund companies require rigorous documentation; and Let us take an example of a chit valuing around, the safety of a chit fund lies in are thus able to help small businesses US$100,000 = 10 subscribers = 10 months: choosing the right one. In a registered overcome their financial constraints. As chit fund company, under legal and when the need arises, SMEs receive With 5% as the commission or service binding, the activities are regulated and the loan out of their own funds by lots. charges for subscribers when s/he institutionalized by the Chit Fund Act Once they receive the loan, they continue is winning the lot will be charged and hence could be considered safe. to pay the monthly contributions. US$5,000 so the rest of the US$95,000 However, other unregistered companies will be paid to him/her at once. In this operating informally do exist. Investors Chit funds are the Indian equivalent group of 10 subscribers, the company need to exercise caution when choosing of the Rotating Savings and Credit is gett ing US$50,000 as commission. where they desire to invest. Associations (ROSCA), which are To avoid defaults we have adopted the popular in many countries such as social pressure system among the group Chit funds defi nitely are an att ractive the US, Cambodia, Korea, Malaysia which is helping to conduct the activities option for regular saving. They inculcate and Indonesia. Chits are an important smoothly; and until now we have not a disciplined approach to fi nancial fi nancial tool, providing access to fi nance faced any defaults. planning. They also have the added for both 8MEs and individuals with advantage of bringing a combination of pressing cash requirements in India. Other normal chit fund companies savings as well as hassle-free borrowing. According to ‘Malabar Kuri’, a book practice by bidding process. For example This dual purpose investment tool writt en by Edith Jemima Simcox, the chit in a scheme of 25 members contributing could be a friend in need at times of fund system existed even during ancient US$100 each per month, for 25 months: unexpected fi nancial emergencies.. Dravidian Times and is somewhat similar to the systems that existed in The total amount collected per month Asif Ulla Khan is the managing director of China. In Japan it is called the ‘Mujin- would be US$2,500. In the auction Amana Chits India. He can be contacted at ko’ or ‘Tanomoshi-ko’ and in Korea it is meeting, bidders can bid only up to this asifk [email protected].

DATE ISSUER SIZE ANNOUNCED Government of Luxembourg EUR200 million 7th January 2014 training Government of Oman OMR200 million 6th January 2014 Vallianz Capital US$500 million 26th December 2013 JANUARY 2014 Bank Asya US$500 million 23rd December 2013 IFB: IFSA 2013 and the Takaful Industry th Ahmad Zaki Resources RM1 billion 19 December 2013 21 January, KUALA LUMPUR 1Malaysia Development RM1.5 billion 19th December 2013 MIFT: Shariah Audit for Islamic Tenaga Nasional RM4 billion 12th December 2013 Business Banking Bank Rakyat RM9 billion 10th December 2014 23-24 January, KUALA LUMPUR BIMB Holdings RM1.7 billion 10th December 2014 FEBRUARY 2014 State Bank of Pakistan PKR50 billion 9th December 2013 SP Setia RM700 million 6th December 2013 IFT: Structuring Islamic Trade Finance Central Bank of Qatar QAR1 billion 6th December 2013 Solution 16-18 February, RIYADH Kuwait Airways TBA 4th December 2013 Hong Kong Government TBA 28th November 2013 MIFT: Structuring Shariah Based Financial Products Binariang GSM RM6 billion 28th November 2013 18-20 February, DUBAI Perusahaan Listrik Negara IDR2 trillion 27th November 2013 South African Government TBA 26th November 2013 MARCH 2014 Dubai Investments US$300 million 19th November 2013 MIFT: Structuring and Shariah Issues Mudajaya Group RM1 billion 19th November 2013 for Islamic Capital Markets Emirates US$4.5 billion 18th November 2013 10-11 March, KUALA LUMPUR Saudi Electricity Company TBA 15th November 2013 MIFT: Islamic Treasury Principles, Federal Government of Nigeria TBA 13th November 2013 Products and Operations 13-14 March, KUALA LUMPUR KPJ Healthcare RM1 billion 7th November 2013 Asian Development Bank TBA 6th November 2013 MIFT: Structuring Sukuk and Islamic Jordanian Government TBA 30th October 2013 Capital Markets Products 16-18 March, DUBAI UK Treasury GBP200 million 29th October 2013 Malaysia Building Society RM3 billion 29th October 2013 Jana Kapital RM4 billion 29th October 2013 Tunisian Government TND1 billion 29th October 2013 Moroccan Government TBA 25th October 2013 National Enforcement and Registration System RM595 million 25th October 2013 Turk Telekomunikasyon US$1 billion 25th October 2013 National Commercial Bank SAR4 billion 11th October 2013 Islamic Development Bank US$10 billion 7th October 2013 ACWA Power International US$800 million 4th October 2013 Government of Yemen YER50 billion 30th September 2013 Emirates Airline US$22 billion 25th September 2013 Government of Pakistan INR7 billion 20th September 2013 Government of South Africa US$700 million 20th September 2013 TH Heavy Engineering RM51.54 million 6th September 2013 Albaraka Turk Katilim Bankasi US$200 million 4th September 2013 Kumpulan Wang Persaraan US$100 million 2nd September 2013 Malaysian Treasury RM2.5 billion 30th August 2013 Societe Generale RM1 billion 26th August 2013 Malaysia Airports Holdings RM2.5 billion 16th August 2013 Dar Al Arkan US$450 million 14th August 2013 OCK Group RM150 million 12th August 2013 Genting Plantations RM1.5 billion 26th July 2013 www.REDmoneyTraining.com Republic of Senegal US$200 million 25th July 2013

REDmoney Asia ex. Japan 6 Months REDmoney Europe 6 Months

All Cap Large Cap Medium Cap Small Cap All Cap Large Cap Medium Cap Small Cap 1200 1150

1090 1080

980 1010

870 940

760 870

650 800 Aug Sep Oct Nov Dec Jan Aug Sep Oct Nov Dec Jan

REDmoney GCC 6 Months REDmoney Global 6 Months

All Cap Large Cap Medium Cap Small Cap All Cap Large Cap Medium Cap Small Cap 1000 1350

900 1216

800 1082

700 948

600 814

500 680 Aug Sep Oct Nov Dec Jan Aug Sep Oct Nov Dec Jan

REDmoney MENA 6 Months REDmoney US 6 Months

All Cap Large Cap Medium Cap Small Cap All Cap Large Cap Medium Cap Small Cap 900 2100

820 1840

740 1580

660 1320

580 1060

500 800 Aug Sep Oct Nov Dec Jan Aug Sep Oct Nov Dec Jan

SAMI Halal Food Participation (All Cap) 6 months

2000

1940

1880

1820

1760

1700 Aug-2013 Sep-2013 Oct-2013 Nov-2013 Dec-2013 Jan-2014

REDmoney Global Shariah Index Series (All Cap) 6 Months REDmoney Global Shariah Index Series (Large Cap) 6 Months

REDmoney Asia ex. Japan REDmoney Global REDmoney Asia ex. Japan REDmoney Global REDmoney Europe REDmoney MENA REDmoney Europe REDmoney MENA REDmoney GCC REDmoney US REDmoney GCC REDmoney US 1300 1200

1150 1050

1000 900

850 750

700 600

550 450 Aug Sep Oct Nov Dec Jan Aug Sep Oct Nov Dec Jan

REDmoney Global Shariah Index Series (Medium Cap) 6 Months REDmoney Global Shariah Index Series (Small Cap) 6 Months

REDmoney Asia ex. Japan REDmoney Global REDmoney Asia ex. Japan REDmoney Global REDmoney Europe REDmoney MENA REDmoney Europe REDmoney MENA REDmoney GCC REDmoney US REDmoney GCC REDmoney US 2100 1900

1780 1620

1460 1340

1140 1060

820 780

500 500 Aug Sep Oct Nov Dec Jan Aug Sep Oct Nov Dec Jan

REDmoney Global Shariah

Equities are considered eligible for inclusion Utilities Basis Materials Telecomunication Services 2% 15% into the REDmoney Global Shariah Index 2% Series only if they pass a series of market Consumer Goods Services 15% related guidelines related to minimum market Technology capitalization and liquidity as well as country 14% restrictions. Energy 8% Once the index eligible universe is determined Non-Cyclical the underlying constituents are screened Consumer Goods Services 7% Financials using a set of business and ﬁ nancial Shariah 4% guidelines. Industrials Healthcare 22% 11%

The REDmoney Global Shariah Index Series powered by IdealRatings consists of a rich subset of global listed equities that adhere to clearly deﬁ ned and transparent Shariah guidelines deﬁ ned by Shariyah Review Bureau in Jeddah, Saudi Arabia.

The REDmoney Shariah Indexes provides Islamic investors with an accurate and Shariah-specifi c equity performance benchmark with optimized compliance credibility due to the intensive research conducted to ensure that index constituents do not confl ict with the defi ned Shariah requirements.

IdealRatings™ is the leading provider of Shariah investment decision support tools to investors globally, including asset managers, brokers, index providers, and banks to empower them to develop, manage and monitor Shariah investment products and Shariah compliant funds. IdealRatings is headquartered in San Francisco, California. For more information about IdealRatings visit: www.idealratings.com

For further information regarding REDmoney Indexes contact: REDmoney Global Shariah Index Series Andrew Morgan Managing Director, REDmoney Group

RED Email: [email protected] Tel +603 2162 7800

Eurekahedge Islamic Fund Index 180

160

140

120

100 Index Values 80

60 Jul-10 Jul-03 Oct-12 Oct-05 Dec-13 Dec-06 Dec-99 Mar-08 Mar-01 Aug-11 Aug-04 May-09 May-02

Top 10 Yield-to-Date Returns for ALL Islamic Funds Fund Fund Manager Performance Measure Fund Domicile 1 Meezan Tahaff uz Pension - Equity Sub Al Meezan Investment Management 46.27 Pakistan 2 Jadwa Saudi Equity Jadwa Investment 46.12 Saudi Arabia 3 Jadwa GCC Equity Jadwa Investment 45.34 Saudi Arabia 4 Atlas Pension Islamic - Equity Sub Atlas Asset Management 44.24 Pakistan 5 Jadwa Arab Markets Equity Jadwa Investment 41.75 Saudi Arabia 6 Atlas Islamic Stock Atlas Asset Management 39.91 Pakistan 7 CIMB Islamic Small Cap CIMB-Principal Asset Management 39.03 Malaysia 8 Al Rajhi Local Shares Al Rajhi Bank 30.48 Saudi Arabia 9 The Iman Allied Asset Advisors 29.91 US 10 Public Islamic Opportunites Public Mutual 28.70 Malaysia Eurekahedge Islamic Fund Index 10.38 Based on 31.91% of funds which have reported December 2013 returns as at the 6th January 2014 Top 10 Sharpe Ratio for ALL Islamic Funds since Inception Fund Fund Manager Performance Measure Fund Domicile 1 Meezan Tahaff uz Pension - Money Market Sub Al Meezan Investment Management 10.09 Pakistan 2 Meezan Tahaff uz Pension - Debt Sub Al Meezan Investment Management 5.27 Pakistan 3 Atlas Pension Islamic - Debt Sub Atlas Asset Management 5.18 Pakistan 4 Public Islamic Money Market Public Mutual 4.40 Malaysia 5 PB Islamic Cash Management Public Mutual 3.38 Malaysia 6 Al Rajhi Commodity Mudarabah - USD Al Rajhi Bank 2.67 Saudi Arabia 7 PB Islamic Bond Public Mutual 1.97 Malaysia 8 Public Islamic Income Public Mutual 1.92 Malaysia 9 Public Islamic Bond Public Mutual 1.82 Malaysia 10 PB Islamic Cash Plus Public Mutual 1.75 Malaysia Eurekahedge Islamic Fund Index 0.14 For funds having a track record of at least 12 months as at the end of December 2013

Comprehensive data from Eurekahedge will now feature the overall top 10 global and regional funds based on a specifi c duration (yield to date, annualized returns, monthly returns), Sharpe ratio as well as delve into specifi c asset classes in the global arena – equity, fi xed income, money market, commodity, global investing (which would focus on funds investing with global mandate instead of a specifi c country or geographical region), fund of funds, real estate as well as the Sortino ratio. Each table covering the duration, region, asset class and ratio will be featured on a fi ve-week rotational basis.

Eurekahedge Islamic Fund Equity Index over the last 3 years Eurekahedge Islamic Fund Equity Index over the last 1 year

130 118 125 116 120 114 115 112 110 110 105 108 100 106 Percentage Percentage 95 104 90 102 85 100 80 98 Jul-13 Jul-12 Jan-13 Jan-11 Jun-13 Oct-13 Oct-11 Feb-13 Sep-13 Dec-13 Dec-13 Dec-13 Apr-13 Apr-13 Mar-13 Aug-13 Nov-13 May-13

Top 10 Islamic Equity Funds by 3 Month Returns Fund Fund Manager Performance Measure Fund Domicile 1 Meezan Tahaﬀ uz Pension - Equity Sub Al Meezan Investment Management 15.50 Pakistan 2 Meezan Islamic Al Meezan Investment Management 14.21 Pakistan 3 Al Meezan Mutual Al Meezan Investment Management 13.51 Pakistan 4 Atlas Pension Islamic - Equity Sub Atlas Asset Management 12.01 Pakistan 5 Al Baraka Hermes Fund Management 11.58 Egypt 6 Amanah Saudi Industrial SABB 11.38 Saudi Arabia 7 Al Rajhi Petrochemical and Cement Equity Al Rajhi Bank 10.12 Saudi Arabia 8 Atlas Islamic Stock Atlas Asset Management 10.07 Pakistan 9 Faisal Islamic Bank of Egypt Mutual Hermes Fund Management 9.77 Egypt 10 The Iman Allied Asset Advisors 9.75 US Eurekahedge Islamic Fund Index 5.92

Based on 39.60% of funds which have reported December 2013 returns as at the 6th January 2014 Top 10 Monthy Returns for Globally Investing Islamic Funds Fund Fund Manager Performance Measure Fund Domicile 1 CIMB Islamic Global Equity CIMB-Principal Asset Management 4.47 Malaysia 2 WSF Global Equity - USD I Reliance Asset Management (Malaysia) 3.10 Guernsey 3 Al-Mubarak Global Equity Arab National Bank 2.27 Saudi Arabia 4 AmOasis Global Islamic Equity AmInvestment Management 2.26 Malaysia 5 HSBC Amanah Global Equity Index HSBC Amanah Central Shariah Committ ee 2.19 Saudi Arabia 6 Al Rajhi Global Equity UBS 2.10 Saudi Arabia 7 JPM Islamic Global Dynamic Equity (USD) A (acc) JPMorgan International Bank 2.05 Luxembourg 8 Al-Mubarak Balanced Arab National Bank 0.98 Saudi Arabia 9 Emirates Islamic Global Balanced EIS Asset Management 0.97 Channel Islands 10 Jadwa Global Sukuk Jadwa Investment 0.25 Saudi Arabia Eurekahedge Islamic Fund Index 0.94

Based on 32.14% of funds which have reported December 2013 returns as at the 6th January 2014

Contact Eurekahedge To list your fund or update your fund information: [email protected] For further details on Eurekahedge: [email protected] Tel: +65 6212 0900

Disclaimer Copyright Eurekahedge 2007, All Rights Reserved. You, the user, may freely use the data for internal purposes and may reproduce the index data provided that reference to Eurekahedge is provided in your dissemination and/or reproduction. The information is provided on an “as is” basis and you assume and will bear all risk or associated costs in its use, and neither Islamic Finance news, Eurekahedge nor its aﬃ liates provide any express or implied warranty or representations as to originality, accuracy, completeness, timeliness, non-infringement, merchantability and ﬁ tness for any purpose.

Most Recent Global Sukuk Priced Issuer Nationality Instrument Market US$ (mln) Managers 23rd Dec 2013 BGSM Malaysia Sukuk Murabahah Domestic market 2,091 RHB Capital, CIMB Group, AmInvestment Management public issue Bank 23rd Dec 2013 Boustead Holdings Malaysia Sukuk Domestic market 208 Affi n Investment Bank public issue 18th Dec 2013 Jana Kapital Malaysia Sukuk Murabahah Domestic market 192 RHB Capital public issue 18th Dec 2013 Malaysia Building Malaysia Sukuk Murabahah Domestic market 152 RHB Capital Society public issue 12th Dec 2013 Malakoff Malaysia Sukuk Domestic market 1,677 CIMB Group, Maybank Investment Bank public issue 12th Dec 2013 Imtiaz Sukuk II Malaysia Sukuk Musharakah Domestic market 156 CIMB Group, Maybank Investment Bank public issue 5th Dec 2013 SABB Saudi Sukuk Domestic market 400 HSBC Arabia private placement 3rd Dec 2013 UEM Sunrise Malaysia Sukuk Domestic market 217 CIMB Group, Maybank Investment Bank public issue 26th Nov 2013 Sukuk Funding UAE Sukuk Musatahah Euro market 750 Standard Chartered Bank, Goldman Sachs, (No 3) public issue National Bank of Abu Dhabi, First Gulf Bank, Dubai Islamic Bank 26th Nov 2013 Ooredoo Tamweel Qatar Sukuk Euro market 1,250 Deutsche Bank, HSBC, DBS, Qatar National public issue Bank, QInvest 22nd Nov 2013 Konsortium Malaysia Sukuk Musharakah Domestic market 718 CIMB Group Lebuhraya Utara- public issue Timur (KL) 21st Nov 2013 Dar Al-Arkan Saudi Sukuk Wakalah Euro market 300 Goldman Sachs, Deutsche Bank, Emirates International Sukuk Arabia public issue NBD, Bank of America Merrill Lynch, Bank Alkhair 14th Nov 2013 GEMS MENASA UAE Sukuk Mudarabah Euro market 200 Mashreqbank, Morgan Stanley, Abu Dhabi (Cayman) public issue Islamic Bank, Credit Suisse 7th Nov 2013 Alpha Circle Malaysia Sukuk Musharakah Domestic market 187 RHB Capital public issue 30th Oct 2013 Syarikat Prasarana Malaysia Sukuk Ijarah Domestic market 318 HSBC, RHB Capital, CIMB Group, Negara public issue AmInvestment Bank 22nd Oct 2013 Gamuda Malaysia Sukuk Murabahah Domestic market 126 CIMB Group, AmInvestment Bank private placement 22nd Oct 2013 DanaInfra Nasional Malaysia Sukuk Murabahah Domestic market 789 RHB Capital, CIMB Group, Affi n Investment public issue Bank, AmInvestment Bank, Maybank Investment Bank 17th Oct 2013 Cagamas Malaysia Sukuk Domestic market 1,198 RHB Capital, CIMB Group, AmInvestment public issue Bank, Maybank Investment Bank 8th Oct 2013 Government of Ras UAE Sukuk Euro market 500 Mashreqbank, Standard Chartered Bank, Al Khaimah public issue National Bank of Abu Dhabi, Citigroup, Al Hilal Bank 3rd Oct 2013 Republic of Turkey Turkey Sukuk Euro market 1,250 Standard Chartered Bank, HSBC, QInvest public issue

Global Sukuk Volume by Month Global Sukuk Volume by Quarter

US$bn US$m US$bn Value (US$bn) Avg Size (US$m) US$m 12 1200 18 600 Value (US$bn) 16 10 1000 14 500 Avg Size (US$m) 8 800 12 400 10 6 600 8 300 4 400 6 200 4 100 2 200 2 0 0 0 0 123 4 5 6 78 9 10 11 12 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q2Q 3Q 4Q 2013 2009 2010 2011 2012 2013

Top 30 Issuers of Global Sukuk 12 Months Issuer Nationality Instrument Market US$ (mln) Iss Managers 1 General Authority Saudi Sukuk Domestic market 4,056 10.6 Saudi National Commercial Bank, HSBC for Civil Aviation Arabia public issue 2 Saudi Electricity Saudi Sukuk Euro market 2,000 5.2 Deutsche Bank, HSBC Global SUKUK Arabia public issue Company 2 3 Sadara Chemical Saudi Sukuk Domestic market 2,000 5.2 Deutsche Bank, Riyad Bank, Al-Bilad Bank, Alinma Bank Company Arabia Musharakah public issue 4 Malakoff Malaysia Sukuk Domestic market 1,521 4.0 CIMB Group, Maybank Investment Bank public issue 5 Perusahaan Penerbit Indonesia Sukuk Euro market 1,500 3.9 Standard Chartered Bank, Deutsche Bank, Citigroup SBSN Indonesia III public issue 6 Cagamas Malaysia Sukuk Domestic market 1,432 3.7 AmInvestment Bank, RHB Capital, CIMB Group, Maybank public issue Investment Bank 7 DanaInfra Nasional Malaysia Sukuk Domestic market 1,310 3.4 RHB Capital, CIMB Group, AmInvestment Bank, Maybank Murabahah public issue Investment Bank, Hong Leong Financial Group, Affi n Investment Bank 8 Republic of Turkey Turkey Sukuk Euro market 1,250 3.3 Standard Chartered Bank, HSBC, QInvest public issue 8 Ooredoo Tamweel Qatar Sukuk Euro market 1,250 3.3 Deutsche Bank, HSBC, DBS, Qatar National Bank, QInvest public issue 10 IDB Trust Services Saudi Sukuk Euro market 1,000 2.6 Standard Chartered Bank, National Consumer Cooperative Bank, Arabia Wakalah public issue RBS, National Bank of Abu Dhabi, Natixis, CIMB Group, Credit Agricole, Barwa Bank 10 Dubai Electricity & UAE Sukuk Ijarah Euro market 1,000 2.6 Standard Chartered Bank, RBS, Dubai Islamic Bank, Abu Water Authority public issue Dhabi Islamic Bank, Citigroup, Emirates NBD 10 DIB Tier 1 Sukuk UAE Sukuk Euro market 1,000 2.6 Standard Chartered Bank, HSBC, National Bank of Abu Dhabi, public issue Dubai Islamic Bank, Emirates NBD 13 Medjool UAE Sukuk Euro market 993 2.6 Standard Chartered Bank, Abu Dhabi Commercial Bank, Wakalah public issue Dubai Islamic Bank, Abu Dhabi Islamic Bank, Citigroup, Emirates NBD 14 National Higher Malaysia Sukuk Domestic market 806 2.1 RHB Capital, AmInvestment Bank Education Fund public issue 15 Sime Darby Global Malaysia Sukuk Ijarah Euro market 800 2.1 Standard Chartered Bank, HSBC, Citigroup, Maybank public issue Investment Bank 16 Sukuk Funding UAE Sukuk Euro market 750 2.0 Standard Chartered Bank, Goldman Sachs, National Bank of (No 3) Musatahah public issue Abu Dhabi, First Gulf Bank, Dubai Islamic Bank 16 Dubai DOF Sukuk UAE Sukuk Euro market 750 2.0 Standard Chartered Bank, HSBC, National Bank of Abu public issue Dhabi, Dubai Islamic Bank, Emirates NBD 18 Dar Al-Arkan Saudi Sukuk Euro market 746 1.9 Goldman Sachs, Deutsche Bank, Masraf Al Rayan, Emirates International Sukuk Arabia Wakalah public issue NBD, QInvest, Bank Alkhair 19 Konsortium Malaysia Sukuk Domestic market 718 1.9 CIMB Group Lebuhraya Utara- Musharakah public issue Timur (KL) 20 Power & Water Saudi Sukuk Domestic market 667 1.7 HSBC Utility Co for Jubail Arabia private placement & Yabbu - Marafi q 21 Turus Pesawat Malaysia Sukuk Domestic market 624 1.6 RHB Capital, Bank Islam Malaysia, CIMB Group, Murabahah public issue AmInvestment Bank, Maybank Investment Bank 22 Syarikat Prasarana Malaysia Sukuk Ijarah Domestic market 623 1.6 HSBC, RHB Capital, CIMB Group, AmInvestment Bank Negara public issue 23 Kapar Energy Malaysia Sukuk Ijarah Domestic market 581 1.5 AmInvestment Bank Ventures public issue 24 TNB Northern Malaysia Sukuk Domestic market 543 1.4 HSBC, KAF Investment Bank Energy Ijarah and public issue Wakalah 25 Turkiye Finans Turkey Sukuk Euro market 500 1.3 Saudi National Commercial Bank, HSBC, Citigroup, Noor Katilim Bankasi public issue Islamic Bank 25 SIB Sukuk Co III UAE Sukuk Euro market 500 1.3 Standard Chartered Bank, HSBC, Kuwait Finance House, Al public issue Hilal Bank 25 Government of Ras UAE Sukuk Euro market 500 1.3 Mashreqbank, Standard Chartered Bank, National Bank of Al Khaimah public issue Abu Dhabi, Citigroup, Al Hilal Bank 25 Al Hilal Bank UAE Sukuk Euro market 500 1.3 Standard Chartered Bank, HSBC, National Bank of Abu Mudarabah public issue Dhabi, Citigroup, Al Hilal Bank / Wakalah 29 Almarai Saudi Sukuk Domestic market 453 1.2 Banque Saudi Fransi, Standard Chartered Bank, BNP Paribas, Arabia private placement HSBC 30 Savola Group Saudi Sukuk Domestic market 400 1.0 HSBC Arabia private placement 38,415 100

Top Managers of Sukuk 12 Months Sukuk Volume by Currency US$ (billion) 12 Months Manager US$ (mln) Iss % 15.7 1 HSBC 6,996 26 18.2 US dollar 2 CIMB Group 4,036 38 10.5 Malaysian ringgit 14.4

3 Maybank Investment Bank 2,872 29 7.5 Saudi riyal 8.0 4 RHB Capital 2,817 38 7.3 Singapore dollar 0.3 5 Standard Chartered Bank 2,804 21 7.3

6 AmInvestment Bank 2,669 26 7.0 Sukuk Volume by Issuer Nation US$ (billion) 12 Months 7 Deutsche Bank 2,384 6 6.2 Malaysia 14.5 8 Saudi National Commercial Bank 2,153 2 5.6 Saudi Arabia 11.8 9 Citigroup 1,395 8 3.6 UAE 6.2 10 Emirates NBD 919 8 2.4 Turkey 2.2 Indonesia 1.8 11 National Bank of Abu Dhabi 906 8 2.4 Qatar 1.3 12 Dubai Islamic Bank 832 5 2.2 Singapore 0.5 13 QInvest 741 3 1.9

14 Riyad Bank 500 1 1.3 Global Sukuk Volume by Sector 12 Months 14 Alinma Bank 500 1 1.3 14 Al-Bilad Bank 500 1 1.3 24% 24% Government 17 Aﬃ n Investment Bank 484 5 1.3 Finance 18 Abu Dhabi Islamic Bank 382 3 1.0 Utility & Energy 6% Transportation 19 Al Hilal Bank 381 5 1.0 Real Estate/Property 7% 20% 20 DBS 309 2 0.8 Other 19% 21 RBS 292 2 0.8 22 Goldman Sachs 284 3 0.7 23 KAF Investment Bank 271 1 0.7 Global Sukuk Volume - US$ Analysis 24 Qatar National Bank 250 1 0.7 US$bn US$m 25 Hong Leong Financial Group 209 8 0.5 18 600 16 Non-US$ US$ 500 26 OCBC 196 6 0.5 14 12 400 10 27 Kuwait Finance House 181 3 0.5 300 8 28 Abu Dhabi Commercial Bank 166 1 0.4 6 200 4 100 29 Barwa Bank 165 2 0.4 2 0 0 30 BNP Paribas 153 2 0.4 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q2Q 3Q 4Q 2009 2010 2011 2012 2013 Total 38,415 119 100

Top Islamic Finance Related Project Finance Mandated Lead Top Islamic Finance Related Project Financing Legal Advisors Arrangers 12 Months Ranking 12 Months Mandated Lead Arranger US$ (million) No % Legal Advisor US$ (million) No % 1 Public Investment Fund 673 3 8.8 1 Cliﬀ ord Chance 3,794 3 33.7 2 Samba Financial Group 605 3 7.9 2 Allen & Overy 3,062 4 27.2 3 National Bank of Abu Dhabi 483 3 6.3 4 HSBC Holdings 483 3 6.3 3 Sullivan & Cromwell 1,494 1 13.3 5 Arab Petroleum Investments 363 3 4.7 3 White & Case 1,494 1 13.3 6 Standard Chartered 338 3 4.4 7 Riyad Bank 291 2 3.8 5 Baker Bott s 666 1 5.9

8 Sumitomo Mitsui Financial Group 283 2 3.7 5 Chadbourne & Parke 666 1 5.9 9 Banque Saudi Fransi 282 1 3.7 7 Mohammed Al Zamil & Emad Al 97 1 0.9 10 Alinma Bank 280 2 3.6 Kharashi Law Firm

Top Islamic Finance Related Loans Mandated Lead Arrangers Ranking 12 Months Top Islamic Finance Related Loans Deal List 12 Months Mandated Lead Arranger US$ (mln) No % Credit Date Borrower Nationality US$ (mln) 1 HSBC 778 4 6.7 th 2 Abu Dhabi Islamic Bank 725 7 6.2 28 Mar 2013 Emirates Aluminium UAE 3,400

3 Standard Chartered Bank 611 5 5.2 10th Jun 2013 ICD UAE 1,675 4 National Bank of Abu Dhabi 577 5 4.9 th 5 Saudi National Commercial Bank 536 4 4.6 5 May 2013 Saudi Aramco Saudi Arabia 1,400 6 Abu Dhabi Commercial Bank 525 3 4.5 5th May 2013 SAMREF Saudi Arabia 1,400 7 Arab Petroleum Investments 519 4 4.4 8 Emirates NBD 511 4 4.4 17th Jul 2013 Al Jubail Petrochemical Saudi Arabia 800 (Kemya) 9 Riyad Bank 447 3 3.8 26th Mar 2013 GEMS Education UAE 545 10 Sumitomo Mitsui Financial Group 439 3 3.8 11 Citigroup 411 2 3.5 18th Jul 2013 Albaraka Turk Katilim Turkey 427 12 Gulf International Bank 367 2 3.1 Bankasi 2nd May 2013 Bank Asya Turkey 383 13 First Gulf Bank 363 4 3.1

14 Dubai Islamic Bank 348 2 3.0 5th Jun 2013 Gulf Marine Services UAE 340 15 National Bank of Kuwait 347 3 3.0 st 16 Samba Capital 341 3 2.9 1 Jun 2013 Mobily Saudi Arabia 321 17 Credit Agricole 332 2 2.9 18 Arab Bank 267 2 2.3 Top Islamic Finance Related Loans by Country 12 Months 19 Islamic Development Bank 258 3 2.2 Nationality US$ (mln) No % 20 Noor Islamic Bank 246 4 2.1 1 UAE 6,501 8 55.6 21 Barwa Bank 189 3 1.6 2 Saudi Arabia 3,987 5 34.1 22 Al Hilal Bank 186 2 1.6 3 Turkey 809 2 6.9 23 Union National Bank 172 1 1.5 4 Qatar 271 1 2.3 23 SG Corporate & Investment Banking 172 1 1.5 5 Malaysia 116 2 1.0 23 Mitsubishi UFJ Financial Group 172 1 1.5 23 Export Development Canada 172 1 1.5 Top Islamic Finance Related Loans by Sector 12 Months 23 BNP Paribas 172 1 1.5 Metal & Steel 23 Al Khalĳ i Commercial Bank 172 1 1.5 Oil & Gas 29 Deutsche Bank 160 1 1.4 30 United Arab Bank 146 2 1.3 Finance

Chemicals Top Islamic Finance Related Loans Mandated Lead Arrangers 12 Months Transportation Bookrunner US$ (mln) No % US$ bln0 126 3 4 5 1 Emirates NBD 568 3 16.1 2 HSBC 519 2 14.7 Global Islamic Loans - Years to Maturity (YTD Comparison) 3 Citigroup 419 1 11.9 2013 3 Abu Dhabi Commercial Bank 419 1 11.9 2012 5 Noor Islamic Bank 299 3 8.5 2011 6 Abu Dhabi Islamic Bank 224 2 6.4 2010 7 Standard Chartered Bank 149 2 4.2 2009 7 Barwa Bank 149 2 4.2 2008 7 Arab Banking Corporation 149 2 4.2 2007 10 Saudi National Commercial Bank 100 1 2.8 0% 20% 40% 60% 80% 100% 10 Riyad Bank 100 1 2.8 0-3yrs 3-5yrs 5-7yrs 7-10yrs 10+yrs 10 Gulf International Bank 100 1 2.8

Are your deals listed here? If you feel that the information within these tables is inaccurate, you may contact the following directly: Mandy Leung (Media Relations) Email: [email protected] Tel: +852 2804 1223

FEBRUARY 2014

25th — 26th The 8th International Takaful Summit Abu Dhabi Afk ar Consulting

APRIL 2014

15th IFN Indonesia Forum Jakarta REDmoney Events

21st IFN Iran Forum Tehran REDmoney Events

MAY 2014

12th — 13th IFN Asia Forum 2014 Kuala Lumpur, Malaysia REDmoney Events

26th — 27th IFN Europe Forum Luxembourg REDmoney Events

JUNE 2014

IFN Islamic Investor Forum 2014 Doha, Qatar REDmoney Events

8th IFN Halal Financing Forum Dubai REDmoney Events

10th IFN Kuwait Forum Kuwait REDmoney Events

SEPTEMBER 2014

IFN Global Forum Dubai REDmoney Events

30th IFN Africa Forum Cairo REDmoney Events

OCTOBER 2014

14th IFN Bangladesh Forum Dhaka REDmoney Events

16th IFN Sri Lanka Forum Colombo REDmoney Events

IFN Saudi Forum Riyadh REDmoney Events

NOVEMBER 2014

6th IFN Turkey Forum Istanbul REDmoney Events

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1Malaysia Development (1MDB) 23 Creditor Steering Committ ee 4 Muscat Securities Market 35 AAOIFI 34,42,44 Crescent Investment Cooperative 34 Muslim Community Cooperative of Australia 19,22,34 A’ayan Leasing and Investment Company 4,13 Dabbagh 4 Musteq Hydro 37 ABC Islamic Bank 28 Dagong Global Credit Rating Company 32 Mydin Mohamed Holdings 36 Abdullah AM Al-Khodari Sons Company 31 DAMAC Real Estate Development 8 ABL Asset Management 34 Damascus Securities Exchange 42 Nakheel 30,33 Ableace Raakin 30 Dana Gas 4,8 NASDAQ OMX Group 28 Ableace Raakin-Amanie 30 DanaInfra Nasional 3,6,13 National Bank for Development 19 Abraaj Capital 17,18 Dar Al Arkan 23,45 National Bank of Abu Dhabi 3,6,16,31 Abraaj Group 33 Dar Al Arkan Real Estate Development Company 23 National Bank of Abu Dhabi Hong Kong 38 ABS Logistics 36 Dar Al Sharia Legal & Financial Consultancy 13,16,39 National Bank of Kuwait 38 Absa Islamic Bank 5,21,22 DBS Bank 14 National Bank of Pakistan 26 Abu Dhabi Commercial Bank 5,28,31 Deutsche Bank 8,9,11,14,17,24 National Bank of Umm al-Qaiwain 31 Abu Dhabi Equity Partners 5,9,11, Deutsche Bank Malaysia 38 National Commercial Bank 18,20,31,43 Abu Dhabi Exchange (ADX) 30 Deutsche Securities Saudi Arabia 7,15 NBAD Asset Management Group 29 Abu Dhabi Islamic Bank 3,6,8,17,21,22,30,32 Devon Bank 22 NBK Capital 38 Abu Dhabi National Oil Company 25 DEWA 4 ACR ReTakaful Holdings 36 Deyar Al Balad 7,10 NCB Capital 27,32 ACWA Power 43 DLA Piper 4,10 NCB Capital Company 4 ADIB Egypt 8,18,22 Doha Bank 33 NCBC Research 32 Adnan Sundra and Low 13 Doha Insurance 35 Nokia Siemens Tietoliikenne Oy 9 Affi n Bank 38 Doha Takaful 35 Noor Financial Investment Company 26 Affi n Holdings 38 Dow Jones 44 Noor Hospitals 4 Affi n Investment Bank 23,38 DRB-HICOM 36 Noor Investment Bank 13 Affi n Islamic Bank 38 Dubai DOF Sukuk 16 Noor Islamic Bank 5 Agusto & Co 12 Dubai Duty Free 43 Noor Takaful 42 Ahli Bank 38 Dubai Group 32 Norton Rose Fulbright 5 Ahli United Bank 29,30,36 Dubai Holdings 32 Ahmad Zaki Resources 23 Dubai Investments 32 OCBC Al-Amin Bank 16 AIG Malaysia Insurance 35 Dubai Islamic Bank 8,10,13,16,17,19,21,25, Oceanic Capital Company 12 Ajman Bank 5,31 28,30,42,43 Omni Law Firm 5 Akhuwat 27 Dubai Islamic Bank Humanitarian Foundation 42 Ooredoo 6,11,14,30,43 Al Ansari Exchange 42 Dubai Islamic Bank Pakistan 14 Oracle Financial Services Soft ware 27 Al Arafah Islamic Bank 19 Dubai Islamic Insurance & Reinsurance (AMAN) 38 Osun Sukuk 6,7,12 Al Baraka Bank 18,42 East Delta Electricity Production Company 1,3,12 Pakistan International Airlines 3,11,14 Al Baraka Bank Egypt 17 EFG-Hermes 32,34,38 Pakistan Mobile Telecommunications 14 Al Baraka Bank South Africa 21 Egyptian Electricity Holding Company 8, Palestine Islamic Bank 21,22 Al Baraka Bank Sudan 21,22 Emirates Airlines 1,3,11,16,30 PanAfrican Capital 12 Al Baraka Islamic Bank 19,20,22 Emirates Aluminium 43 Pandu Logistics 9,13 Al Baraka Islamic Bank Egypt 19 Emirates NBD 16,34 Al Baraka Lebanon 20,22 Emirates NBD Capital 5,28 Paramount Corp 24 Al Baraka Syria Bank 21 Emirates REIT 34 Park 10 10 Al Baraka Turk 3,6 Ericsson AB 9 Perbadanan Tabung Pendidikan Tinggi Nasional 10 Al Hilal Bank 5,16,34,42 Essel Finance 34 Petromin 4 Al Hilal Islamic Banking Services 38 Essel Group 34 Phoenix Global Capital Market 12 Al Kharafi Group 5 Ethical Finance (EFL) 41 Projek Lintasan Shah Alam 36,37 Al Madina Insurance Company 35 Etihad Airways 30 Public Bank 29 Al Madina Takaful 35 European Islamic Investment Bank (EIIB) 12,29 Public Mutual 29 Al Marai Company 10,15 F.O. Fagbohungbe & Co 12 Qasim International Container Terminal 14 Al Meezan Investment Management 33,44 Fajr Capital 17,18 Qatar Development Bank 31 Al Noor Hospitals Group 5,6,7,16 FBN Capital 12 Al Rajhi Bank 17,18,20,22,32,33 FCMB Capital Markets 12 Qatar Exchange 45 Al Rajhi Banking & Investment Corporation 17 Fidelity Securities 12 Qatar First Investment Bank 18 Al-Aqeelah Takaful 42 First Community Bank 20 Qatar Insurance Company 45 Albaraka Türk Katılım Bankası 10,16,22 First Guardian 33 Qatar International Islamic Bank 32,45 AlBilad Investment Company 7,15 First Gulf Bank 5,31 Qatar Investment Authority (QIA) 31 Al-Falaah 17,18,21,27 Fitch 4,5,12,19,27,36,37,40 Qatar Islamic Bank 5,10,14,20,22,33 Alinma Bank 31 Franklin Templeton Investments 40 Qatar National Bank 3,6,45 Alinma Investment Company 7,15 FWU 12 QInvest 14,30,38,45 Alinma Tokio Marine Company 34 Gatehouse Bank 22 QNB Capital 14 Al-Jadaan & Partners Law Firm 4,33 GEMS Education 8,10,16,24 RAM 11,36,37,40 Alkhabeer’s Express Publishing & Investment 6, GFH Capital 29,30 Allen & Overy 3,4,6,7,9,10,11,15,16 Gibson, Dunn & Crutcher 5 Ras Gas 10 Almarai 27 Global Investment House 45 Rasmala Group 12 Al-Mourjan For Electricity Production Company (Rabigh 2 IPP) 11 Golden Agri-Resources 13 Rasmala Holdings 29 Al-Muthanna 31 Goldman Sachs International 8 RHB Investment Bank 9,10,11,13,24 AM Best Europe – Rating Services 34 Goldman Sachs Malaysia 38 RHB Islamic Bank 9,10 Aman Syria 42 Greenwich Trust 12 Riyad Bank 32 Amana Bank 21,22,24,41 Gulf African Bank 20,22 Riyad Capital 7,15 Amana Chits India 48 Gulf Finance House 30,38 Russell Investment Group 44 AmanahRaya Trustees 17,18 Gulf International Bank 17 S P Setia 4,9,10,13 Amanie Advisors 11,12 Gulf Marine Services 4,5,16 S&P 4,33,36,37 Amanie Group 30 Hadiputranto, Hadinoto & Partners 11 S&P Middle East 38 AmInsurance 27 Hatem Abbas Ghazzawi & Co 7,15 AmInvestment Bank 13 Hong Leong Financial Group 38 Saba Islamic Bank 22 AMMB Holdings 27,34 Hong Leong Investment Bank 9,10 Sadara 6,9 AmTakaful 27 Hong Leong Islamic Bank 38 Sadara Basic Services Company 7,15 Apple 44 HSBC 4,8,14,16,24 Sadara Chemical Company 7,15 Arab Banking Corp 31 HSBC Amanah 16,40 Samba Financial Group 43 Arab Finance House 20 HSBC Amanah Malaysia 4,11,28 SapuraKencana 36 Arab Insurance Group 34 HSBC Holdings 40 SATORP 7 Arab Islamic Bank 21 HSBC Saudi Arabia 4,14,24 Saudi Arabian General Authority of Civil Aviation (GACA) 1,3,4,15,33 Arabian Centers Company 10 ICB Islamic Bank 25 Saudi Arabian Monetary Agency 34 Arcapita 4,5 IDB 16,19,24,25,26,28,29,42 Saudi Aramco 7,25 Arcapita Investment Holdings 8 IFC 29 ASAR Al Ruwayeh & Partners 4 IFSB 31,42 Saudi ARAMCO Mobile Refi nery 5 ASBIF 26 IIRA Bahrain 19,32,42 Saudi British Bank (SABB) 23,21,32,36,43 Asian Institute of Finance 28 INCEIF 28 Saudi Electricity Company (SEC) 6,7,24,37 Astra Internasional 11 International Bank of Azerbaĳ an 5 Saudi Investment Bank 33 Astra Sedaya Finance 5,11,13 International Islamic Financial Market 32 Savola 27 Astro Malaysia Holdings 38 International Islamic Liquidity Management Securities and Commodities Authority (UAE) 30,32 Atlantic Council 42 Corporation (IILM) 1,3,6,11,43 Securities Commission (Malaysia) 13,23 Atlanticlux Lebensversicherung 5,12,16 International Islamic Trade Finance Corporation (ITFC) 16,25 SEDCO Group 19 Australian Center for Islamic Financal Studies 26 Investment Corporation of Dubai 43 Senai-Desaru Expressway 37 Australian Center for Islamic Finance 34 Irish Stock Exchange 14 Sharjah Islamic Bank 16 Azmi & Associates 26 iSfi n 26 Shearman & Sterling 7,15 Bahra Advanced Cable Manufacturing Co 9,11 Islami Bank Bangladesh 19,22,25 Bahrain Islamic Bank 19 Islamic Bank of Asia 14,18,21 SHUAA Capital 36,38 Bait Al Mashura 30 Islamic Bank of Britain (IBB) 29 SICO Investment Bank 33 Baker & Mckenzie 11,16 Islamic Bank of Thailand 18,21 Siemens Pakistan Engineering Company 7,14 Bangladesh Petroleum Corporation 25 Islamic Corporation for the Development of the Private Sector (ICD) 26 Sime Darby 4,6 Bank Al Jazira 20 Islamic Council of Victoria 34 Skye Financial Services 12 Bank Alkhair 33 Istanbul Stock Exchange 24 Somerset Place 12,16 Bank Asya 6,16,24 Jadwa Investment of Saudi Arabia 44 Stanbic IBTC Capital 12 Bank Dhofar 30 Jammu and Kasmir Bank 27 Standard Chartered Bank 3,4,6,16,28,29,38 Bank Indonesia 18 Jati Cakerawala 37 Standard Chartered Bank Pakistan 14 Bank Islam 27 Jordan Dubai Islamic Bank 20,22 Standard Chartered Saadiq 11,16,17,18 Bank Islam Brunei Darussalam 19,22 Jordan Islamic Bank 20,37 Bank Islam Malaysia 6,18,32 JP Morgan 5,19 State Bank of Pakistan 14,26 Bank Melli Iran 20,22 JP Morgan Chase 10,24 Sterling Capital Markets 12 Bank Muamalat Indonesia 17,18,19,22 K&L Gates 45 Sumitomo-Mitsui Banking Corporation 19 Bank Muamalat Malaysia 20 Kadir, Andri & Partners 11 Swber Holdings 24 Bank Muscat 20,32 Karachi Stock Exchange 44 Swiss Re International 29 Bank Negara Malaysia 17,18,41 KBL Private Bankers 3,6 Syria International Islamic Bank 21,22,42 Bank Nizwa 20,22,32 KDU University College 11,24 Syrian Islamic Insurance Company 42 Bank of Bahrain and Kuwait 31 Kemya 15 Syrian Lebanese Commercial Bank 42 Bank of London and The Middle East (BLME) 12 Key Bank 10 Tadawul 7 Bank of Tokyo-Mitsubishi UFJ 19,22 KFH Australia 19 Takaful Ikhlas 34 Bank of Tokyo-Mitsubishi UFJ Malaysia 11 KFH Capital Investment Company 31 Bank Rakyat 23 Khaleeji Commercial Bank 32,33 Takaful Insurance of Africa Group 34 Bank Simpanan Nasional 28 Khazanah Nasional 4 Takaful International Company 34 Banka Kombëtare Tregtare 28 Kimanis Power 7 Takaful Oman 35 Banque Misr 25 King & Spalding 8 Takaful Re 34 Banque Saudi Fransi 24,43 Kola Awodein & Co 12 Taqwaa Advisory and Shariah Investment Solutions 34 Barwa Bank 5,10,16,20,31 Konsortium Logistik 28 Taylor-DeJongh 25 Barwa Bank Group 10 Kotak Mahindra Bank 31 Teknologi Tenaga Perlis Consortium 36 Barwa Real Estate 45 KPMG 38 Telekom Malaysia 3,7,11 Baspinar & Partners 46 Kuveyt Turk 28 Tenaga Nasional 37 Bedell, Christian Guernsey Partnership 12 Kuwait Finance House 3,6,19,20,22,30,31 The Dow Chemical Company 7,15 BGSM Management 26,36,40 Kuwait Finance House Bahrain 28,31 The First Investor 10 BIMB Holdings 4,6,10,13,27 Kuwait International Bank 28 Bin Shabib & Associates 47 Kwantas Corporation 37 Tilal Development Company 7,28 Binariang GSM 26,27 Labuan Financial Services Authority 28,41 TKSB 28 BLME 21,22,29 Lanka ORIX Finance 17,18,21 TNB Western Energy 37 BNP Paribas Malaysia 11 Lariba American Finance House 22 Tope Adebayo 12 Borsa Istanbul 28 Latham & Watkins 8,9,10,11,14,16 Total E&P Congo 31 Boubyan Bank 19,20 Lead Capital 12 Tradewinds Plantation Capital 37 Boustead Holdings 23 Lembaga Kemajuan Perusahaan Pertanian Negeri Pahang 37 Trading Corporation of Pakistan 9,11 British Gas 10 Lembaga Tabung Haji (LTH) 12,16,28 Trowers & Hamlins 16 Business Custodians 26 Linklaters 4,8,11 Tun Razak Exchange (TRX) 25 Cagamas 10,24 London Stock Exchange 30 Turk-Eximbank 9,11,16 Capital Markets Authority (Oman) 35 LTH Property Holdings 16 Cass Business School of City University (London) 31 MAA Takaful 35 Turkiye Finans Katilim Bankasi 22 Cekap Mentari 36 Maisarah 30 UAE Insurance Authority 47 Central 384 24 Malakoff Power 36 UMW Holdings 9 Central Bank of Bahrain 23,31,32,41 Malayan Banking (Maybank) 3,4,6,19,29,36 UMW Oil & Gas Corporation 8 Central Bank of Bangladesh 25 Malaysia Airports Holdings 9,13 Uni Capitial 12 Central Bank of Egypt 8 Malaysia Building Society 1,3,6,11,13,33 Union Capital Markets 12 Central Bank of Libya 25 MAR 45 Union National Bank 31,36 Central Bank of Qatar 45 Maran Nakilat 5,10,14 United Arab Bank 5,31 Central Bank of the UAE 17,31 MARC 37 United Overseas Bank Malaysia 23 Cham Bank 42 Marina Securities 12 Univers Acier 11,12 Chapel Hill Advisory Partners 12 Mashreq 5 Upper Egypt Electricity Production Company 25 Cheraman Financial Services 33 Masraf Al Rayan 29,32,45 CIMB 18,22 Maxis Communications 40 US Federal Reserve 33,43 CIMB Bank 3,6,11 Maybank Investment Bank 3,13,36 Vallianz 24 CIMB Group 29 Maybank Islamic 3,4,16,36,37 Vallianz Capital 24 CIMB Investment Bank 3,9,10,13 McGraw Hill Companies 44 Vision Financial Holding 26 CIMB Islamic 27 Meethaq Bank 32 Vodafone 40 CIMB Islamic Bank 9,13,17,18,20,21,22,27 Meezan Bank 7,13,14,20,22,26,40,44 Walkers 16 CIMB Niaga Syariah 19 Mesaieed Petrochemical Holding Company 32 West Coast Expressway (WCE) 24 Citi 4 MetLife 34 Weststar Aviation Services 6 Citi Islamic Investment Bank 4 Meydan Sobha Group 31 White & Case 5,7,14 Citibank 28 Milbank, Tweed, Hadley & McCloy 7,15 Widam Food Company 31 CityCentreDC 3,5,7,10 Mobily 8,11,15 Cliff ord Chance 4,8,14,33,38 Mochtar Karuwin Komar 11 Wong & Leow 11,16 Commercial Bank International 16 Mohamed Ridza & Co. 13 Wong & Partners 16 Commercial Bank of Qatar 33 Mohammed Abdul Mohsin Al Kharafi & Sons Co 13 World Bank 30 Commercial Bank of Syria 42 Moody’s 4,5,29,32,36,37,40,45 World Bank Group 29 Commerzbank Aktiengesellschaft 28 Morgan, Lewis & Bockius 12 Zaid Ibrahim & Co 4 Continental Rail 25 MRCB Southern Link 36 Zenith Securities 12 Crédit Agricole Corporate and Investment Bank 9,11 Mubadalah GE Capital 5 Zul Rafi que & Partners 4 SUBSCRIPTIONCOMPANY INDEX FORM

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