News Clips from the past week

RHB Islamic confident of 20% loans growth in FY08
Amwal, Shuaa Capital and QInvest successfully close a QR728m Shari'ah compliant Mezzanine investment vehicle
Emirates Islamic Bank Announces Outstanding Q3 Results
Islamic bank set up in Bahrain
Two UAE-based financial institutions joined hands with other GCC firms to launch an Islamic bank in Bahrain, yesterday with an authorised capital of $200 million (Dh734m) and a paid-up capital of $120m, said a statement.
Amrahbank is ready to launch services Islamic banking
Islamic banking may flourish in Afghanistan: most Afghan traders against getting loan on interest
Standard Chartered to launch Islamic banking in Bahrain
Mashreq reports impressive nine months results
• CIMB PRIVATE EQUITY AND ALAM MARITIM IN RM252 MLN JV
• BARWA Real Estate Announces QR299 Million Q3 2008 Profit
• EIB Q3 PROFIT NEARLY DOUBLES
• SAUDI ARABIA, QATAR SAY BANKS ARE SOLID:

Meezan Bank establishes 125 branches across Pakistan successfully established over 125 branches spread over 35 major cities across Pakistan within a short span of six years.
growth in branch network is the fastest in the Banking history of Pakistan. The investment in the branch network is driven by the Bank's vision to establish Islamic Banking as the Banking of First Choice so as to enable it to reach each and every citizen of Pakistan

Abu Dhabi, United Arab Emirates, banking briefs
Oct. 30--EIB Q3 PROFIT NEARLY DOUBLES: Emirates Islamic Bank has reported that its third-quarter profit almost doubled, Bloomberg reported. Net income advanced to Dhs123.9m ($33.7m), or 0.13 dirham a share, from Dhs68.6m, or 0.07 dirham, in the year-earlier period. Income from financing jumped 87 percent to Dhs225.7m.

SAUDI ARABIA, QATAR SAY BANKS ARE SOLID: The central bank governors of Saudi Arabia and Qatar said their banks are well-capitalized and can withstand any downturn in global markets, Bloomberg reported. Saudi Arabia's local banks are 'highly liquid' and have 'good capital adequacy,' Hamad Saud al-Sayari said. Meanwhile, Qatar's central bank governor Abdulla Bin Saud al-Thani said the country has 'very solid banks, highly capitalized, highly liquid and nothing needs to be done by the central bank'.

Approaching zero With rates down to 1%, the Fed may next try more unconventional steps

International Islamic Financial Market launches first-ever standardised Master Murabaha, Agency Agreements

10 October 2008

Pakistan Press International Information Services
Manama, October 09 (PPI) : International Islamic Financial Market (IIFM) launched worlds first-ever standardised Master Agreement in Islamic finance. IIFM Master Agreement for Treasury Placement (MATP) can be used by financial institutions across the globe for their over-the-counter Commodity Murabaha transactions.

With estimated value of more than $100bn, Commodity Murabaha currently is widely used Islamic money market product in GCC and other jurisdictions for liquidity management purpose. The development of MATP culminates a year of work by IIFM Secretariat involving Islamic financial institutions, Shariah scholars, legal experts and other market practitioners, said Khalid Hamad, Chairman IIFM & Executive Director Central Bank of Bahrain.

Standardisation of certain broader market documentation, products has become critical need for growing Islamic finance industry in many regions of world, said Ijlal Alvi Chief Executive Officer of Bahrain-based IIFM.

He says going forward such support by CBB and other permanent member jurisdictions DIFC, Labuan Offshore Financial Services Authority Malaysia, Bank Indonesia, Bank of Sudan, State Bank of Pakistan, Vrunei Finance Ministry & Islamic Development Bank will continue to ensure wider adaptation.

Shariah-compliant investment company Amara launches today with first investment into China

Newhaven Investments House announces today the launch of Amara Holdings Inc ('Amara' or 'the Company'), a Shariah-compliant investment company which focuses on pre-IPO, private equity and private placement opportunities predominantly in China, as well as MENA and India.

Islamic finance rides the storm CLANCY YEATES 1065 words 11 October 2008 The Sydney Morning Herald

Islamic finance rides the storm

CLANCY YEATES

11 October 2008

The Sydney Morning Herald

Comment & Analysis

A thriving financial sector sounds like an oxymoron these days. Even Australia's banks - among the most profitable in the world - kept a fifth of this week's interest rate cut to cushion their margins. But there is one sector that has tongues wagging in the hubs of commerce: Islamic finance.

Sukuk Squeeze? Economist Intelligence Unit - Business Middle East

This story was covered in The Economist Intelligence Unit - Business Middle East
16 October 2008
The sukuk market has shrunk this year: a knock-on effect of the global credit crisis, or the result of tougher rules on sharia-compliance?

The volume of Islamic bond issuance, which recorded massive growth rates in 2006 and 2007, has dropped during the year to date. There is a lively debate as to whether this can be attributed mainly to global financial market conditions or whether a new-found fastidiousness in sharia-compliant structuring in causing the downturn.

Islamic finance and banking will win

Friday, 26 September 2008 BDO Stoy Hayward says financial turmoil puts Islamic products in strong position. Written by Paul Williams

With the financial markets in the most volatile state since the 1930s, and the London Stock Exchange experiencing more highs and lows than a rollercoaster ride, increasing numbers of individuals and corporations will now invest in Islamic banking and Sharia compliant products than ever before, predicts accountants and financial advisers BDO Stoy Hayward...

http://www.dofonline.co.uk/strategic-finance/islamic-finance-and-banking-will-win5525874.html

Interesting Insights on Islamic Banking from a non-Muslim

http://makewealthhistory.org/2008/10/10/learning-from-islamic-finance/

Although I’d happily consider a mortgage from an Islamic bank if I needed one, my point here is not necessarily to advocate Islamic banking as the answer. The title says it all - what can we learn from this? Are their some principles we could take away about exploitative interest? How can we provide mortgages that are fair in the long term? Can we distribute profit and loss more equitably, rather than the bank always winning?

As a Christian, I’m challenged by this too, because the Bible also forbids usury. ‘If you lend money to one of my people among you who is needy, do not be like a moneylender; charge him no interest’, says Exodus 22, although other passages (see Luke 19) suggest it is excessive interest that is condemned, rather than the interest per se. Either way, where are the Christian millionaires calling for more ethical banking? Where are the theologians sitting down with economists to make sure our banking doesn’t violate the principles of the Kingdom of God?

What is at the core of the philosophy of Islamic Finance is the idea of money a measure of value, and not a real asset in itself. According to the principles of Islamic Finance, profiting from money–including charging interest on loans–is regarded as riba, or non-permissible investing activity under Sharia law. Instead, what Islamic Finance emphasizes is the idea that the investors should share the risks involved in whatever projects they are investing in, and that they should be investing in real things, whether it’s land improvement projects, housing, or helping start up a new business.

http://www.adbusters.org/blogs/adbusters_blog/islamic_finance_and_possibility_rebirth.html#comment-5500

Could the credit crunch prove to be a boon for Islamic banking - and for Asian entrepreneurs? - Management Today Magazine

It’s been another rotten week for our big banks, whose struggles continue despite the best efforts of governments. But according to accountants BDO Stoy Hayward, their woes could provide an opportunity for Islamic banks. Since they’ve generally been much more conservative (for which read: much less leveraged) than their conventional Western counterparts, they’ve been less affected by the problems in the credit markets – which could make them a much better bet both for investors seeking stable returns, and for entrepreneurs on the hunt for financing…

http://www.managementtoday.co.uk/channel/GovernanceCSR/news/852697/asian-jewels-crown/