Asia Alliance Bank (AAB), which is one of the first commercial banks in Uzbekistan to adopt Islamic banking in compliance with Shariah law, has partnered with ICS Financial Systems (ICSFS) to expand its offering of Islamic instruments by way of implementing ICS Banks Islamic Banking software solutions. This service will be provided in collaboration with the Islamic Corporation for the Development of the Private Sector (ICD), according to a statement issued on the 20th of May 2021.  Why it Matters?  With the ICS Banks Islamic Banking softwar...

Chief Executive Officer of Malaysian Rating Corp Bhd (MARC), Datuk Jamaludin Nasir, has stated that Sukuk are expected to maintain their dominant role in Malaysia’s debt market owing to a strong appetite for high-yield instruments, as interest rates worldwide are forecast to stay low for 2021. Why it Matters?  Sukuk issuance worldwide is set to rise in 2021 amidst COVID-19 vaccination programmes and the restart of economic activities. Malaysia-issued Sukuk have also gained momentum with foreign investors, evident by a recent issuance of USD 1.3...

The National Zakat Agency of the Republic of Indonesia (BAZNAS) has appointed the Zakat Management Unit (UPZ) of Bank Syariah Indonesia (BSI) as an official strategic partner in collecting, managing and distributing Zakat to Mustahik. Why it Matters?  President Director of BSI, Hery Gunardi, noted that this alliance between BSI and BAZNAS would optimise the potential benefits of Zakat, Infaq and alms (ZIS) in the country. It is also an effort to strengthen and spread the Zakat ecosystem and the Love Zakat Movement, which was inau...

ESG and sustainability data are moving in the direction of more mandatory disclosuresRegulators want more consistent ESG data, but that won’t guarantee it is more usefulInvesting in capacity to understand the nuances behind different ESG data and the context in which they are reported and used is critical to making more ESG data translate into better outcomes The future of sustainability reporting and disclosure is evolving rapidly, but regulators see it transitioning from voluntary to mandatory and expanding in scope, beginning with climate-related topics. The Internationa...

Dubai-listed, Shariah-compliant real estate investment trust (REIT), Emirates REIT, plans to offer holders of its USD 400 million Sukuk the option to exchange their notes for new instruments. According to the proposal, unsecured Sukuk would be exchanged for secured bonds. The company also seeks to extend its credit maturity to improve its balance sheet following adverse impacts of COVID-19. The existing Sukuk mature in 2022, whilst the new instrument would mature in 2024. Emirates REIT issued USD 400 million Sukuk Murabahah ...

In its Annual Report and Corporate Governance Report 2020 submitted to Bursa Malaysia on the 19th of May 2021, Malaysia Building Society Bhd (MBSB) has stated that its short-term and longer-term business plans are focused on becoming a fully matured Islamic financial organisation by 2025.  Why it Matters? In the short term, MBSB’s Business Plan 2021 (BP2021) has three key strategies: focus on navigating COVID-19 by preserving stakeholder confidence, optimising customer reach via digital capabilities and t...

Turkiye Emlak Katilim Bankasi A.S. (Emlak Katilim)’s Long-Term Foreign Currency (LTFC) Issuer Default Rating (IDR) has been affirmed at B with a Stable Outlook by Fitch Ratings (Fitch).  Ratings Rationale The rating reflects potential support from the Government of Turkey, if needed, given the 100% state-ownership, in addition to the strategic importance of Islamic banking in Turkey. There is also a proven track record of capital support from the Government.  Liquidity and funding risks are higher, given the...

Just a day after the Egyptian Senate voted in favour of the 24-article law, the Parliament's Economic Affairs Committee approved a new law on the 18th of May 2021 allowing the Finance Ministry to issue sovereign bonds (Sukuk) on local and foreign markets. The Sukuk will be issued both in paper as well as electronically and will be denominated in EGP and foreign currency.   Why it Matters? According to Ahmed Samir, Chairperson of the Economic Affairs Committee, the draft law sets the framework for Egypt to ...

Chairman of the Securities Commission Malaysia (SC), Datuk Syed Zaid Albar, has highlighted the importance of broadening the credit spectrum within the domestic bond market to accommodate smaller bond issuers. Speaking at the MARC Virtual Malaysian Bond and Sukuk Conference on the 19th of May 2021,  Syed Zaid noted that the challenge would be in adapting bond and Sukuk markets in order to ensure cost-effective ways for small and lower-rated issuers to raise the required funds to meet growth and expansion plans...

Malaysian Rating Corporation (MARC) has affirmed its AA-IS rating on Sinar Kamiri’s MYR 245 million Green Sustainable and Responsible Investment (SRI) Sukuk Wakalah, with a Stable Outlook. Sinar Kamiri is a special purpose project company that owns and operates a 49 MWac solar power plant in Sungai Siput, Perak, Malaysia.   Ratings Rationale The rating affirmation reflects Sinar Kamiri’s project fundamentals that are based on the terms of a 21-year power purchase agreement (PPA) with Tenaga Nasional Berhad (TNB), which include...