Dubai-based Dar Al Takaful (DAT) and Abu Dhabi-based Watania have announced the completion of their merger effective the 1st of July 2022 to form DAT, with total issued share capital of AED 260 million (USD 70.7 million). Why it Matters? Through the merger, DAT benefits from combined expertise, broad infrastructure and partner network, cost and revenue synergies, and improved IT platforms. With the Takaful industry consolidating, the company aims to leverage its business model to optimise sales channels and cross-selling opportunities through expanding geographic coverage an...

The Islamic banking sector in Iraq is expected to continue witnessing medium-term assets growth on the back of the government’s strategy to promote Islamic finance and financial inclusion amidst the low banking penetration in the country, according to Fitch Ratings.  Why it Matters? The Iraqi Islamic banking sector is relatively small and underdeveloped, with a general lack of faith in the financial system. Low knowledge of Islamic products, a lack of standardisation and Islamic liquidity-management tools, and a small product selection are some of the major issues face...

Sukuk issuance globally, both in local and foreign currency, have witnessed a drop to stand at USD 74.5 billion during the first half of 2022, from USD 93.3 billion during the same period in 2021, with the majority of core Islamic finance countries, apart from a few, posting declines, according to S&P Global Ratings. Why it Matters? As key Islamic finance countries’ financing requirements reduce due to higher oil prices, and as complexity and liquidity prices rise, further decline is anticipated in Sukuk issuance volumes for the remainder of 2022. Fa...

The State Bank of Pakistan (SBP) has announced its adoption of four more Shariah standards of Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), as per a press release issued on the 4th of July 2022.  Why it Matters?  SBP has been gradually and methodically implementing AAOIFI Shariah standards to elevate the local Islamic banking sector to parity with global best practises and further increase the standardisation and harmonisation of Shariah processes and procedures. The implementation of the standards, as part of SBP's 3rd Strategic Plan for...

The Securities Commission (SC) Malaysia has introduced a new Sukuk framework called the Sustainable and Responsible Investment-linked (SRI-linked) Sukuk Framework, in order to assist businesses in securing financing to address sustainability issues, as per a statement issued on the 30th of June 2022. Why it Matters? The Framework is a continuation of the SRI road map activities that were unveiled in 2019 to increase the variety of SRI products. With the faster transition towards creating a climate-resilient future, high-emitting industries are in danger of being phased out; compa...

Kuwait-based Warba Bank has announced that it has entered the metaverse, occupying two websites, Decentraland and Sandbox.  Why it Matters?  As Virtual Reality (VR) is now used in a wide range of businesses, including education, medicine, and the services industry and as digital trends continue to evolve into Web3, Warba Bank plans to bring VR to a more convenient location and cater to its younger clientele, according to Anwar Bader Al Ghaith, Warba Bank’s Acting Deputy Chief Executive Officer (CEO) of Support Services & Treasury. Details  In 20...

By Dr. Eman Tabet, Research Associate, RFI FoundationCompanies with large holdings of cash in banks are more exposed than they might think to financed emissions risks. Unlike retail depositors, they have more options but also more risk in managing their large cash balances, and must become even more attuned to the risks they take in pursuit of higher returns.   An estimate of large technology companies has found that they had much more emissions exposure from their cash deposits than from their operationsSome companies may be more effective in reducing their emissions footprin...

The Saudi Investment Bank (SAIB) has completed a private placement of Saudi Riyals denominated Tier 1 Sukuk worth SAR 2 billion (USD 533 million), to meet its financial demands, as per a filing to the Saudi Stock Exchange (Tadawul). Why it Matters? The Sukuk has a perpetual maturity and a 6% return rate that will be paid from the date of issue until the 29th of June 2027, at which point it will reset. The offering included 2,000 total Sukuk at an SAR 1,000,000 par value. Details  The lead manager and bookrunner for the offering was Alistithmar Capital.  From...

Indonesia has announced the sale of Sukuk worth IDR 7.8 trillion (USD 525.78 million) in an auction held on the 28th of June 2022, according to the Ministry of Finance. Why it Matters? The offer amount fell short of an IDR 9 trillion (USD 606.77 million) indicative target, while the yields on the offered Sukuk were lower than the previously offered notes. Total incoming bids were higher than those received in the previous offer (IDR 15.13 trillion: USD 1 billion) and stood at IDR 15.77 trillion (USD 1.1 billion). Details  Indonesia raised IDR 5.1 trillion (USD...

Malaysia-based Tomei Consolidated Berhad (Tomei) has announced its intentions to launch an Islamic Medium-Term Notes Programme with a nominal value of up to MYR 150 million (USD 34 million). Why it Matters?  The programme, based on the principle of Murabahah through a Tawarruq arrangement, will allow Tomei the freedom to occasionally issue secured or unsecured Sukuk Murabahah and will have a duration of 25 years from the date of the first issuance. Details  The appointed principal adviser, lead arranger, and lead manager for the programme is Public Invest...