The volumes of Sukuk issuances in 2020 are expected to remain similar to 2019 levels, despite the unexpected pressures brought about by the COVID-19 pandemic, according to Fitch Ratings (Fitch), in a recent commentary. Furthermore, Fitch anticipates that Sukuk supply will increase with rising funding requirements as market conditions recover further.  According to Fitch, sovereigns will remain the largest contributors to overall Sukuk volumes in 2020, amidst increased borrowing requirements and widening fiscal deficits attributed to economic disruptions by COVID-19 as wel...

Evidence from regional surveys supports our approach of viewing responsible finance first as a business issueThe unique features of prudent leverage and a focus on equity, combined with a business-oriented focus on ESG, deliver positive economic, environmental and social outcomesRFI Foundation’s upcoming research focuses on providing new information and practical recommendations on how to use it The RFI Foundation (RFI) has been in existence for five years, and during that time it has created significant awareness of responsible finance across many of the markets in which Islami...

Islamic banking, Takaful

Pakistan International Airlines (PIA) is planning to raise up to PKR 20 billion in financing through Sukuk. PIA has appointed BankIslami Pakistan to act as financial advisor and joint bookrunner, with proceeds from the issuance expected to lower the losses of the state-owned airline, according to local media reports.  Amir Ali, President and Chief Executive Officer of BankIslami Pakistan, stated that as PIA is majority-owned by the Government of Pakistan (GoP) and the Sukuk is backed by the GoP guarantee, the issuance...

Saudi Arabia-based bank, Banque Saudi Fransi (BSF) commenced the issuance of its SAR-denominated Additional Tier 1 Sukuk on the 19th of October 2020, through a private placement offer, according to a filing released on the Saudi Stock Exchange (Tadawul).  BSF stated that the minimum subscription for the issuance is SAR 1 million with a perpetual maturity, with a par value of SAR 1 million. The number and value of any Sukuk offered will be determined based on market conditions, with the listing price and return also su...

RHB Bank has completed its first issuance of Senior Sukuk Murabahah worth MYR 300 million in nominal value under its Sukuk Murabahah Programme of up to MYR 10 billion, according to a filing with Bursa Malaysia released on the 20th of October 2020.  The Senior Sukuk Murabahah, rated AA2/Stable by RAM Rating Services, were issued for a five-year tenure with a fixed profit rate of 2.85% per annum, to be paid semi-annually in arrears. According to the bourse filing, proceeds raised from the Senior Sukuk Murabahah&nbs...

Indonesian Vice President Ma'ruf Amin has emphasised the need to develop the country’s Halal industry by expanding its role in the global trade of Halal products, in addition to fulfilling domestic requirements, according to local media. Speaking at a recent virtual inauguration of the Halal Marketing and Management Digitalization Training Program for Micro, Small and Medium Sized Enterprises (MSMEs), Amin stated that Indonesia should make use of the potential of the global Halal market by boosting its exports, which currently only make up around 3.8% of the total global...

Standard and Poor’s Global (S&P Global) Shariah-compliant benchmarks significantly outperformed conventional indices, in the third quarter of 2020 (3Q 2020). With global equities gaining 8.1% year-to-date (YTD), the S&P Global Broad Market Index (BMI) Shariah and the Dow Jones Islamic Market (DJIM) World Index recorded gains of 13.3% YTD and 14.4% YTD, respectively in the same period.  On a regional basis, emerging markets saw the largest improvements, with the DJIM World Emerging Markets Index yielding an additional 21.3% return over that of convention...

Speaking at the Financing Climate Action Conference held in Malaysia on the 20th of October 2020, Bank Negara Malaysia (BNM) Assistant Governor, Fraziali Ismail, stated that Malaysia’s Sukuk market, which is a high-growth sub-segments of the country’s Islamic finance industry has a crucial role in facilitating the growth of the green technology sector.  According to Ismail, Islamic financing could be an enabler of Malaysia’s sustainable development, by providing a funding source for activities or technologies that contribute towards a low-carbo...

United Arab Emirates (UAE) lender, Abu Dhabi Islamic Bank (ADIB), has launched a sales platform which allows customers to apply for personal finance, takaful, covered cards and other banking products remotely.  According to media reports, the platform is UAE’s first virtual banking sales platform, and features virtual banking tools including online applications and electronic signature services, while integrating virtual communication tools.  According to Samih Awadhalla, Head of Retail Distribution at ADIB, the UAE lender has seen 75% of its c...