The International Monetary Fund (IMF) has lowered its economic growth forecasts for  Indonesia down to 4.3% for 2021 (previous estimate at 4.8% in January 2021), whilst maintaining its estimate at 5.8% for 2022.  Why it Matters? In its latest projections made in March 2021, Indonesia’s Finance Minister Sri Mulyani Indrawati acknowledged that COVID-19 remained a threat to Indonesia's recovery and that Indonesia's economy was still anticipated to contract by 1.0% to 0.1% in the first quarter&...

Affin Islamic Bank in Malaysia (AIBM) has signed a strategic deal with Zurich Takaful Malaysia (ZTM), making it the first bank in Malaysia to have a Bancatakaful collaboration, ‘Affin Sure Cover’, according to a statement released by AIBM.  Why it Matters? Speaking at the launch of the product, Nazlee Khalifah, Chief Executive Officer (CEO) of AIBM stated that the collaboration with ZTM is in tune with AIBM’s business strategy to enga...

The Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) has confirmed that its Governance and Ethics Board has met to review and debate on conceptual issues regarding Shariah-compliant crowdfunding. According to Omar Mustafa Ansari, the Secretary-General of AAOIFI, the Organisation is preparing to publish an exposure draft later in 2021.  Why it Matters?  Crowdfunding is gaining popularity as an alternative funding source within the industry. However,...

RAM Ratings (RAM) has reaffirmed the A1/Stable rating of Projek Smart Holdings’ (Smart Holdings) MYR 330 million Islamic Medium-Term Notes (IMTN) Facility (2015/2032) (Sukuk). Smart Holdings is the sole shareholder of Syarikat Mengurus Air Banjir & Terowong (SMART), which is the concessionaire for the Stormwater Management and Road Tunnel Project (SMART Tunnel). Ratings Rationale The reaffirmation is based on RAM’s assessment that Smart Holdings’ credit metrics will continue to support the Sukuk rating, despite volatile near-ter...

Bahrain-based Islamic retail bank, Ithmaar Bank has signed an agreement with the Bahrain Bourse (BHB), enabling it to use Ijara Sukuk issued by the Central Bank of Bahrain (CBB) as underlying assets to complete Murabahah Finances. This will be conducted through an online Shariah-compliant brokerage service introduced by BHB, according to an official statement issued by Ithmaar Bank on the 6th of April 2021.  Why it matters? The online Murabahah service for banks and corporates was introduced as part of BHB’s efforts to develop the capital marke...

The Government of Indonesia has raised IDR 7.345 trillion from its biweekly auction of State Shariah Securities (SBSN), also known as State Sukuk, held on the 6th of April 2021, according to a statement issued by the Directorate General of Budget Financing and Risk Management (DJPPR), Ministry of Finance. Although the amount raised was below the indicative target of IDR 10 trillion, it was higher than the IDR 6.396 trillion raised in the previous auction held on the 23rd of March 2021. Tota...

The Small and Medium Enterprises (SMEs) Financing Guarantee Program (Kafalah) aims to help SMEs in accessing Islamic finance in order to develop their businesses. To this effect, the Saudi Arabia-based fund has demonstrated its strength, with more than 10,000 establishments now benefiting from it. Director General, Homam Hashem, said that guarantees stood at SAR 30 billion (USD 7.9 billion) at end-2020, double the value of those in 2019.   Why it Matters?  The fund continues to serve the development priorities and economic needs of a large number of...

On the 5th of April 2021, the State Bank of Pakistan (SBP) announced its third five-year strategic plan for Pakistan’s Islamic banking industry. The SBP targets a 30% share of assets and deposits for the Islamic banking industry by 2025 versus the current level of around 18%. The other targets that it has set for Islamic banking include a 10% share of small and medium-sized enterprise financing and an 8% share of agriculture financing in private-sector banking.   Why it Matters?  The SBP considers Islamic banking an utmost p...

World Economy and Islamic Finance: Comparison of Government Policies during the Global Financial Crisis and the COVID-19 CrisisProvision

In order to organise programmes under the Malaysian Technical Cooperation Programme (MTCP), the Islamic Banking and Finance Institute Malaysia (IBFIM) and the Ministry of Foreign Affairs (MOFA) have collaborated to promote two of IFBIM’s flagship certification programmes. Why it Matters?  IBFIM stated that two of its key certification programmes, the Associate Qualification in Islamic Finance (AQIF) and the Fundamental Certificate in Islamic Banking (FCIB), were selected by the MOFA for this collaboration. Chief Executive Officer of IBFIM, Yusr...