Data from the Kingdom of Saudi Arabia’s (KSA) Ministry of Finance (MoF) revealed the third quarter 2020 (3Q 2020) budget deficit at SAR 40.768 billion, mainly due to a decline in oil revenue led by low oil prices and production cuts. However, the deficit had more than halved compared to the second quarter of 2020, due to an increase in overall government revenues. Total government revenue was up 4.0% year-on-year (YoY) reaching SAR 215.6 billion in 3Q 2020, despite a 30.0% YoY decline in oil revenues during the same period. The main driver of government revenue was tax increases i...

The Indonesian Islamic economy and finance industry has great potential to be developed, according to Joko Widodo, Indonesian President. Speaking at the official virtual inauguration ceremony of the seventh Indonesia Shariah Economic Festival (ISEF) in 2020, hosted by Bank Indonesia (BI) on the 28th of October 2020, Widodo urged that concrete steps must be determined and implemented to develop the industry. According to local media reports, Widodo stated that the ISEF 2020 can build the momentum to create a clear and detailed road map to boost economic development and the Islamic financ...

Whilst Malaysia’s Takaful industry has not been spared from the effects of the COVID-19 pandemic, the Malaysian Takaful Association (MTA) maintains a positive outlook for the sector for 2020. Speaking at the virtual Takaful StarNite 2020 event held on the 28th of October 2020, MTA Chairman, Muhammad Fikri Mohamad Rawi commended the proactive agents in the industry as well as various initiatives taken by the country’s Takaful industry to maintain positive penetration momentum. Rawi noted that Takaful agents embraced digital platforms and technology to creatively promote Takaf...

Fitch Ratings Thailand (Fitch) has affirmed at AA(tha), the National Long-Term Rating (NLTR) of Islamic Bank of Thailand (IBANK), whilst IBANK’s National Short-Term Rating has been affirmed at F1+(tha). The Outlook is Stable.  IBANK is a government-run policy bank, designated as a specialised financial institution (SFI), and set up under specific legislation with the aim of providing Islamic financial services. It is the only Shariah-compliant bank in Thailand. According to Fitch, the Government of Thailand has recently provided IBANK with financ...

In order to soften the impact of the COVID-19 pandemic on Indonesia’s banks and borrowers, the Financial Services Authority (OJK) has announced the extension of its loan restructuring programme until March 2022. The OJK explained that this policy extension would be finalised via an OJK Regulations (POJK) and that it would also extend other programmes simultaneously, such as the exclusion of loan-at-risk calculation when assessing the health of banks. The loan restructuring programme, established in March 2020 (POJK No. 11...

The United Arab Emirates’ (UAE) third-largest Emirate of Sharjah is planning the reopening of its USD 750 million Sukuk due on the 23rd of October 2029, by hiring banks to arrange the process. The 2029 Sukuk was originally issued in 2019.  A document issued showed that Sharjah has hired Mashreq Bank as financial advisor, whilst appointing Dubai Islamic Bank, HSBC, Sharjah Islamic Bank and Standard Chartered to arrange investor calls that commenced on the 27th of October 2020. Media reports revealed that the Su...

The Central Bank of the Republic of Turkey (Central Bank) reported a 4.9% month-on-month (MoM) decrease in international reserves held, totalling USD 79.7 billion at the end of September 2020.  A statement issued by the Central Bank showed a 6.3% MoM decline in foreign currency reserves in September 2020, whilst gold reserves fell 3.7% MoM in the same month. The former was reported at USD 36.3 billion with the latter at USD 41.8 billion, at the end of September 2020.  Pre-determined, short-term net drains of the Central Government of Turkey...

Data issued by Egypt’s state-run Central Agency for Public Mobilization and Statistics (CAPMAS), revealed a 20.5% year-on-year (YoY) decline in Egypt’s trade deficit to USD 3.02 billion in August 2020, from USD 3.80 billion a year ago.  Foreign trade statistics published in CAPMAS’ monthly bulletin stated that Egypt’s exports fell 9.4% YoY in August 2020 to reach USD 1.91 billion. The decrease was attributed to a reduction in the export of various commodities including crude oil (down 46.5% YoY), pe...

Indonesia Stock Exchange’s (IDX) Development Director, Hasan Fawzi, has suggested four ways in which the IDX continues to develop the country’s Islamic capital market. The four perspectives considered for this purpose comprise investors, instruments, infrastructure and social investing. Fawzi noted that at present only 6% of Islamic stock investors open their accounts by using the Shariah Online Trading System (SOTS). IDX aims to strengthen its Shariah investor base and raise this figure to 10% through the design of educ...

RAM Ratings (RAM) has reaffirmed the rating of Aquasar Capital’s MYR 1.5 billion Sukuk Murabahah Programme (2014/2029) at AAA(s)/Stable. Aquasar Capital is the Government of Sarawak’s funding conduit for the Sukuk programme to finance the development of the Kuching Centralised Sewerage System.  According to RAM, the operations and maintenance of the project does not impact Aquasar Capital’s repayment of the Sukuk. The rating reflects the credit strength of Sarawak, as periodic principal and profit payments are...