Best Islamic Banks Poll 2006

Vol. 3, Issue 45 15th December 2006 The World’s Global Islamic Finance News Provider In this issue INDONESIA News Briefs Bank Indonesia Shariah boost Capital Markets .......................................... 1 Bank Indonesia has launched a program to strategies which include promoting supply US$3.5 billion Sukuk up for grabs accelerate the development of Indonesia’s and demand, strengthening the Shariah European asset managers take on Bahrain Islamic banking sector. Currently, Shariah banking system in terms of capitalization compliant banking comprises only 1.68% of and management, optimizing the functions INCEIF University the country’s total banking assets, a fi gure of government and the Central Bank and EIIB in strategic link-ups that the Central Bank aims to increase to inducting all the stakeholders in the Shariah 5.25% by the end of 2008. banking sector into the program. Ratings ......................................................... 8 Fitch assigns AA+ to IDB It is hoped that the bank’s program will boost The Central Bank will also look to increase the sector by 75% to an approximate US$5.3 government participation, its deputy governor KMCOB receives rating billion by end of 2007 and a subsequent Siti Fadjriah revealed: “We also expect Cover Story .................................................. 9 235% to US$10.1 billion by 2008. government agencies to start utilizing the Offshore Financial Centers - Then and Now Shariah system for their banking activities, The program will be based on four main such as disbursing funds.” Offshore Financial Centers .....................11 Shariah Law and Jersey Structures Offshore Financial Centers .....................13 BAHRAIN From Cayman to Dubai Corporate Governance and Shariah CIMB – KANOO alliance Compliance ...............................................15 CIMB and Yusuf bin Ahmed Kanoo Holdings Badlisyah Abdul Ghani, CEO of CIMB Corporate Governance .............................17 (Kanoo Group) will each hold a 50/50 Islamic and board member of CIMB–Kanoo, Stakeholders’ Financial Interest stake in the recently launched CIMB–Kanoo elucidated: “CIMB Group is excited to be in Islamic Investment Company, which will begin Term Sheet ................................................19 Bahrain and the Middle East through this AREF Investment Group operations with a paid-up capital of US$20 partnership with the Kanoo Group. We are million. committed to the Middle East and it is our Term Sheet ................................................20 vision to provide a fi nancial services bridge UNION NATIONAL BANK Having been licensed by the Central Bank Forum .........................................................21 of Bahrain, this joint venture aims to market linking this dynamic region to the East.” and distribute specialized Islamic investment Meet the Head ..........................................22 banking products and services to the Middle In related news, CIMB Group’s Islamic arm John Weguelin East. Its primary focus will be debt and equity projects that it will arrange at least RM25 capital markets, corporate banking, asset billion (US$7.03 billion) in Sukuk issuance for Takaful News .............................................23 management and treasury services. 2007, similar to the total achieved for 2006. Takaful Report ..........................................24 The Legal Framework of Takaful in Malaysia CHINA Takaful Forum ...........................................25 GIH wins bid Moves .........................................................26 Global Investment House (GIH)’s Shariah tate Fund initially closed on the 6th November Eurekahedge .............................................27 compliant Global Asia Real Estate Fund, to- with US$75 million, but has now reopened to gether with a Kuwaiti partner has won the bid new investors with a second closure planned Dow Jones Islamic Indexes .....................28 to acquire a distressed asset in China. The as- within the next two months. The fund’s pro- set, located in north-east China’s Dalian Eco- jected internal rate of return is an annual 20% Bondweb ....................................................29 nomic and Technological Development Area, net of total fees, cost and taxes. Dealogic – League Tables .......................30 possesses a value of US$32 million. Global plans to continue its Asian expansion, Events Diary...............................................33 Cushman & Wakefi eld Capital Asia advised having already identifi ed the initial portfo- Global’s acquisition of the deal via innovative lio of properties in the region. Pakistan and Subscriptions Form ..................................34 fi nancial restructuring techniques, including Vietnam are slated to be next in line after the put and call options. The Global Asia Real Es- fund’s Chinese and Indian investments. Country Index ............................................34 Company Index ......................................... 34 Best Islamic Banks Poll 2006 ................ 30 Best Islamic Banks Poll Submission dateline 15th December 2006 www.islamicfi nancenews.com NEWS BRIEFS Islamic Finance news UAE (Abu Dhabi) Advisory Board: US$3.5 billion Sukuk up for grabs Mr Daud Abdullah (David Vicary) The UAE developer Aldar Properties will sell a total of US$3.5 billion in Sukuk in the fi rst quarter Managing Director of 2007; twice the amount the company initially announced. Hong Leong Islamic Bank Proceeds from the bonds may be converted into shares in Aldar or be used to repay investors in Dr Mohd Daud Bakar cash, said Shafqat Malik, the company’s chief fi nancial offi cer. “The terms will allow the board Chief Executive Offi cer to make that decision at maturity,” he added. International Institute of Islamic Finance Depending on demand, Aldar is considering raising the entire amount in a single issue, making Prof Dr Mohd Masum Billah the Islamic bond the second largest Sukuk in the world. Associate Professor International Islamic University of Malaysia BAHRAIN Dr Humayon Dar Managing Director European asset managers take on Bahrain Dar Al Istithmar Dexia Asset Management, a subsidiary of the US$136 billion Dexia group, has begun its venture into the Middle East. Dexia’s Middle East offi ce will provide services to Lebanon, Jordan, Mr Badlisyah Abdul Ghani Egypt and the GCC region. Chief Executive Offi cer CIMB Islamic Henri-Michel Tranchimand, a member of the executive committee at Dexia Asset Management, stated: “After recently opening our branches in Scandinavia and in Germany, we are confi rming Ms Baljeet Kaur Grewal our strategy of expansion and our wish to grow towards the Middle East. Bahrain is an ideal Chief Economist platform on which to develop our regional presence.” Aseambankers Mr Sohail Jaffer This move comes less than a month after Dexia Private Bank of Switzerland established its Partner & Chief Executive Offi cer representative offi ce in Bahrain. (See Moves, page 26.) FWU Group Dr Monzer Kahf Consultant/Trainer/Lecturer MALAYSIA Private Practice INCEIF University Mr Mohd Ridza bin Mohammed The International Center for Education in Islamic Finance (INCEIF) has been conferred univer- Abdullah sity status by Malaysia’s Ministry of Higher Education. Managing Partner Mohamed Ridza & Co Dr Zeti Akhtar Aziz, governor of Bank Negara Malaysia and also chairman of INCEIF’s board of directors, received the conferment letter on behalf of the university from the Minister of Higher Prof Bala Shanmugam Education. Director of Banking & Finance Monash University Malaysia INCIEF has also signed a MoU with nine other universities in Malaysia to create an alliance in terms of education, training, research and development of Islamic fi nance. The universities in- Mr Muhammad Nejatullah Siddiqi volved include University Malaya, Universiti Kebangsaan Malaysia, Universiti Putra Malaysia, In- ternational Islamic University Malaysia, Univiersity Utara Malaysia, University Malaysia Sabah, Author, Scholar, Speaker, Trainer Monash University Malaysia, Universiti Teknologi MARA and Open University Malaysia. Mr Rushdi Siddiqui Global Director The newly awarded university has established a Professional Development Panel comprising Dow Jones Islamic Indexes of 13 individuals. These individuals will possess the highest authority with regard to academic affairs. The panel is represented mainly by academia from local and international institutions Mr Dawood Taylor and prominent individuals from the fi nancial industry. Head of Takaful Taawuni Division Bank Aljazira Additionally, INCEIF has awarded six research grants to four of its allied universities, amounting to RM700,000 (US$197,228). Mr Abdulkader Thomas President & Chief Executive Offi cer SHAPE – Financial Corp. BAHRAIN Mr Paul Wouters Of Counsel New Sukuk hub Bener Law Offi ce A US$200 million Sukuk Exchange Center (SEC) will be set up in Bahrain by early 2007. Inves- tor response has been encouraging, amounting to 70% of the total capital, with the remaining Prof Rodney Wilson US$60 million to be raised via private placement. Director Durham University Islamic Finance Fuad Hamed Al Homoud, chairman of the founding committee, confi rmed that the center would Program create new Islamic investment and fi nancial tools to support and contribute liquidity in the Is- Mr Sohail Zubairi lamic capital and investment markets. Vice President & Head Shariah Coordination SEC’s alliance with the region’s major fi nancial companies will also boost its standing in the Dubai Islamic Bank Sukuk sector. Page 2 15th December 2006

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