Sultan Nazrin Muizzuddin Shah, the Sultan of Perak, Malaysia, has proposed the notion of establishing an Association of Southeast Asian Nations (ASEAN) institution of Islamic finance to encourage incoming foreign investment for regional infrastructure and other projects as he spoke at the 17th Kuala Lumpur Islamic Finance Forum (KLIFF) that took place on the 16th of August 2022. Why it Matters? As the global economy continues to shift eastward, the Islamic finance industry can boost additional expansion throughout ASEAN by driving investment and creating social value. Given the e...

Banks and other financial institutions are facing growing pressure from investors and regulators to offer details behind their Net Zero commitments. However, for many, there are analytical, data and other challenges that remain obstacles to demonstrating the short-, medium- and long-term paths to meeting their commitments. Investor focus on climate risks to the financial sector is moving beyond the existence of a long-term Net Zero targetFinancial institutions are not yet equipped with sufficient methodologies to show that their alignments to Net Zero trajectories aren’t just reflec...

Indonesia-based property developer PT Intiland Development Tbk (Intiland Development) is set to issue Sustainable Sukuk Ijarah I Phase II worth IDR 250 billion (USD 16.83 million) under its IDR 750 billion (USD 50.49 million) Sukuk Ijarah programme, as per a statement made on the 19th of August 2022. Why it Matters? The issuance succeeds a previous offering of IDR 250 billion (USD 16.83 million) Sukuk Ijarah I Phase I made by Intiland Development in 2021. The recent offering, which has a term of 3 years, will see the use of its proceeds in the repayment of the remainder of the 2021 f...

Saudi Arabia-based Maharah Human Resources Company (Maharah) has obtained long-term Murabaha financings from Al Rajhi Bank and Saudi British Bank (SABB) amounting to SAR 362.5 Million (USD 96.52 million) to fund the company’s upcoming purchases, as per a statement by the stock exchange on the 21st of August 2022. Why it Matters? The obtained financings comprise of a long-term loan of SAR 181.5 million (USD 48.32 million) from Al Rajhi Bank and a loan of SAR 181 million (USD 48.19 million) from SABB, with a seven-year term that includes a two-year grace period. D...

Sukuk sales in the domestic market of the Kingdom of Saudi Arabia (Saudi Arabia) increased by 185% in 2022 compared to 2021, reaching USD 14.4 billion, or more than half of all domestic Sukuk sales worldwide, with the Saudi government alone selling more than 60% of it. Why it Matters? Saudi Arabia’s borrowing needs are still going strong despite the fact that it may record its first budget surplus in almost ten years as government revenues climb as a result of a surge in oil prices above USD 100. Project financing is protecting the Sukuk market from a worldwide recession th...

Malaysia-based Maxis Broadband Sdn Bhd (MBSB), the wholly-owned subsidiary of Maxis Berhad, has announced the issuance of two Sukuk series nominally valued at MYR 400 million (USD 89.5 million), under its MYR 10 billion (USD 2.2 billion) unrated Sukuk murabahah programme, as per a bourse filing on the 17th of August 2022. Why it Matters? Proceeds from the issuance will be used for working capital needs and capital expenditure of MBSB as well as to settle the purchase consideration relating to the acquisition of businesses and undertakings, inclusive of pertinent assets and liabil...

Bahrain-based Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) has taken the steps to fully digitalise and automate its internal and external operations and processes through employing several technologies, applications and services, to increase operational efficiency and make full use of its resources for a higher value proposition. Why it Matters? The project's goals include streamlining AAOIFI's standard-setting processes, enhancing the adoption rate and effectiveness of its standards’ implementation, and opening up new avenues for interac...

Shareholders of Nigeria-based Jaiz Bank PLC (Jaiz Bank) have given unanimous approval to the bank’s Board of Directors to raise NGN 150 billion (USD 353.6 million) through the issuance of Sukuk or Equity from the Nigerian capital market, at the Bank’s 10th Annual General Meeting held in Abuja, Nigeria on the 16th of August 2022. Why it Matters? The Board of Directors, on the back of the shareholders’ endorsement, has been given the authority to take any and all actions necessary by the Central Bank of Nigeria, the Securities and Exchange Commission, th...

The Islamic Corporation for the Development of the Private Sector (ICD) and Uzbekistan-based Joint-Stock Commercial Bank (JSCB) Agrobank have announced the signing of a Shariah-compliant Line of Financing Agreement worth USD 25 Million, aimed at advancing Islamic finance, enhancing financial inclusion, and aiding the development of the private sector in the country. Why it Matters? The facility comes after three previous lines that were extended by the ICD to Agrobank in 2010, 2012, and 2018, totalling USD 21 million, which enabled the support of several...

The government of Pakistan has raised PKR 2 trillion (USD 9.3 billion) to date through the issuance of Government Ijara Sukuk (GIS), since its first offering in 2008. Why it Matters? Pakistan has witnessed a shift towards the use of Sukuk instead of interest-based government bonds to raise funds as they were found to save billions for national coffers and significantly reduce government debt, while enabling the use of underlying assets repeatedly over time as needed. The country had raised up to PKR 936 billion (USD 4.3 billion) in funds through GIS issues from 2008 to 2017,...