The Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) has officially issued financial accounting standard (FAS) 37, titled ‘Financial Reporting by Waqf Institutions’, according to a recent statement by AAOIFI. The standard was finalised by the Accounting Board (AAB) of the AAOIFI following discussions and deliberations from global Shariah scholars and industry experts.  FAS 37 addresses financial and accounting reporting requirements of Waqf institutions to ensure compliance with Shariah principles and rules. According to th...

European insurance regulator EIOPA has found significant transition risk exposure in the reported investment holdings of the insurers it overseesDue to more limited scale, fewer Shariah-compliant fixed income markets and greater exposure to transition-risk economies, takaful operators may face heightened riskRFI Foundation’s research illustrates an example of the transition risk facing takaful operators that could be mitigated if the opportunity set of green & sustainable sukuk was larger Insurers have been at the forefront of many changes relating to climate change because...

Ajinomoto Malaysia Berhad (AMB) has entered into a sustainability-linked Islamic funding agreement with MUFG Bank Malaysia (MUFG) for a principal value of MYR 100 million (USD 24.75 million). According to a media report, the funds will go towards the construction of AMB’s new plant in Negeri Sembilan and the company will adhere to environmentally friendly industrial development practices.  The facility has a five-year maturity period and is linked to environment sustainability performance targets that AMB is expected to achieve, including a 30% reduction in gre...

Egypt’s economy is at a turning point, according to a World Bank report released on the 21st of December 2020, titled “Creating Markets”, with the reform programme launched in 2016 having enhanced socio-economic conditions, restoring confidence in the economy and improving macro-economic stability. Under the economic reform programme, the report noted that the Government of Egypt carried out a host of changes including liberalisation of the exchange rate, expansion of public investment to improve infrastructure (road networks) and utilities (gas and...

Islamic Development Bank (IsDB) has approved USD 509.2 million in financing for two large-scale projects of economic significance in Uzbekistan on the 19th of December 2020, according to local media reports.  The first project, worth USD 200 million will facilitate the modernisation of several infrastructures and social facilities in Karakalpakstan, Khorezm, Bukhara, and Navoi regions of Uzbekistan. Set to improve the living conditions of over 710,000 people, the project involves the construction and reconstruction of wate...

The National Mortgage Corporation of Malaysia, also known as Cagamas, has announced the combined issuance of Sukuk and bonds amounting to MYR 450 million, in its final issuance of 2020, according to local media reports. Proceeds of the issuance will be utilised to fund the purchase of house financing and housing loans from the financial system. The issuance comprises of MYR 50 million two-year Islamic Medium-Term Notes (IMTNs) and MYR 400 million three-month Conventional Commercial Papers (CCPs). The IMTNs were priced at a spread of 41 basis points (bps) above the correspondin...

The International Monetary Fund (IMF) has projected Qatar’s economy to grow by 2.7% year-on-year in 2021, a gradual recovery supported by a rebound in the country’s domestic market as well as an upturn in the domestic gas industry, with higher gas production anticipated.  According to IMF Advisor, Mercedes Vera-Martin, swift implementation of COVID-19 prevention and containment measures allowed Qatar to limit the impact of the pandemic, with the country resuming all economic activity in September 2020.  The IMF noted that upside pote...

Fitch Ratings (Fitch) has affirmed Saudi-based Bank Aljazira's (BAJ) Long-Term Issuer Default Rating (IDR) at 'BBB+' with a Negative Outlook. In addition, BAJ's Viability Rating (VR) has been affirmed at 'bb+' and removed from Rating Watch Negative (RWN). Several Saudi banks’ VRs were placed on RWN in March 2020 following a drop in oil prices and economic disruptions amid the COVID-19 pandemic. The resolution of the RWN on BAJ’s VR based on the company’s 3Q 2020 financial results reflects Fitch’s view of the lower short-term risk of a sudden drop i...

RAM Ratings Services (RAM) has reaffirmed the AA3/Stable rating of Edra Energy’s Sukuk Wakalah of up to MYR 5.085 billion (2018/2038) (the Sukuk).  Edra Energy is a Malaysia-based power generation service provider, which owns, operates, develops, and maintains power plants. RAM’s reaffirmation is based on Edra Energy having adequate liquidity to endure a six-month construction delay faced by its 2,242 MW power plant in Alor Gajah, Melaka (the Plant). In addition, the reaffirmation takes into consideration a higher tax payment due to the rei...

At a Parliamentary discussion,  Arthur Joseph Kurup, Deputy Minister in the Prime Minister’s Department (Economy) highlighted encouraging metrics from Malaysia’s retail, tourism and commodity industries. Responding to an in-house question on current economic conditions, challenges faced and measures taken to steer the economy out of COVID-19, Kurup noted that several key economic indicators provided proof of Malaysia’s progress.                ...