Thursday, July 31, 2008

Takaful opportunities in EU

The large Muslim populations within EU countries – 20 million spread over 27 countries - make takaful business an attractive opportunity, writes PricewaterhouseCoopers UK’s Mohammed Amin and Mohammad Kahn in Middle East Insurance Review (Feb 2008) issue, posted on the former’s blog.
The authors noted that the current accounting and regulatory regimes in the region do not preclude takaful businesses from setting up and marketing to consumers. Indeed this is starting to occur. However, they cautioned companies evaluating this option will need to consider how to keep their operations Shariah-compliant, while also complying with local accounting and solvency regulations.
Takaful allows Muslims to access methods of minimising financial risk that were not open to them through conventional insurance.

Wednesday, July 30, 2008

Malaysia is a hotbed for Islamic banking headhunters

By Habhajan Singh
A leading Gulf Cooperation Council (GCC) bank is looking for a senior banker to head its Islamic financial services team based in London, according to an advertisement updated on July 16 on a job portal. The advertisement added that the team will be responsible for structuring and selling a range of Shariah-compliant investment and retail banking products to other financial institutions. There are other such interesting and tempting job offers at this very moment.
"I'm getting at least two calls a month from headhunters," Asian Finance Bank Bhd chief operating officer Daud Vicary Abdullah told The Malaysian Reserve recently.
Malaysia is a hotbed for headhunters looking for candidates for existing and new Islamic banks, both locally and abroad. Local Islamic bankers say that it is not easy to get good talent, more so as many are leaving for the Middle East, partly attracted by lucrative pacgkages.
"Talent development is a crucial issue and the industry must focus on it," said HSBC Amanah managing director Yakub Bobat in an interview a few months ago. Back to London. A "leading global investment bank" is actively seeking a senior Islamic banking candidate to add to its Shariah product development and distribution team, says another advertisement. It is not looking for just any candidate.
The advertisement, updated on July 4, said that it is looking for the "strongest candidates in the market" to join its already established Islamic banking team.
The ideal candidate must have a good "track record in the GCC markets" as he or she will mostly be tailoring products for large Gulf corporate and institutional investors throughout the United Arab Emirates, Bahrain, Kuwait, Qatar, Oman and Saudi Arabia. As expected, a keen search is also taking place in the Middle East. Standard Chartered Bank UAE, based in Abu Dhabi, is in the market for an Islamic banking associate director, promising a "highly competitive salary".
Another Kuwaiti-based "exciting new start-up bank" is looking for a head of private banking to expand that portion of its business. The unnamed bank said it aims to develop the best Islamic bank in Kuwait/GCC. So, who fits the bill? See if you can rise to this calling, as mentioned in the advertisement:
"The successful candidate will have the gravitas to lead and develop the Islamic financial services business.
"They would be representing the bank by taking a leading role in generating new business streams and marketing new and existing products and services, in conjunction with working at the highest levels on strategy and policy as part of the senior management."
(The Malaysian Reserve, July 21, 2008, p32)

Sunday, July 27, 2008

Unicorn Msia seeks CEO

By Habhajan Singh & Ishun P Ahmad
Unicorn International Islamic Bank Malaysia Bhd (Unicorn Malaysia) is in the market in search of a chief executive officer (CEO).
The wholly-owned subsidiary of Bahrain-based Unicorn Investment Bank also has a number of other openings at its management level.
"We are in the process of hiring staff. Its not easy to get right level of calibre. Many Malaysians are going overseas," Unicorn Malaysia chairman Datuk Vaseehar Hassan told The Malaysian Reserve in a recent interview.
On the search for a CEO, he said: "Its not an easy position to fill."
The Islamic bank is on the lookout for a head of investment banking and chief financial officer. Since getting its license about six months ago, Unicorn Malaysia staff strength is now 12 people strong, and they expect to bump up the number to 20 by September.
"We are putting our system in place. This include the the operating manual and treasury. Once we have completed them, which I except in month or so, we will be ready to move," he said. Unicorn Malaysia is currently helmed by acting CEO Thameem Ghouse who has been seconded from Bahrain.
Other key members of its management team are head of treasury Francis Ng, strategic mergers and acquisitions (M&A) Lim Sumay, head of placement Samera Poweel.
Recently, The Malaysian Reserve reported that Unicorn Malaysia is set to begin operations in a month's time and expects to rake in profits by year-end and that the bank is already eyeing a number of deals.
Vasheehar said that the bank had several deals in the pipeline, including a couple of mandates already signed, which its teams are working on.
"We will be able to close this year with some maiden profit," he said.
He said Unicorn Malaysia will utilise US$20 million (RM64.55 million) of its initial investment for its business in the country, which includes investment banking, corporate finance and treasury.
Its parent, Unicorn Investment Bank, was founded in 2004 as an Islamic investment bank and has a presence in the United States, the United Arab Emirates, Turkey and Pakistan.
Unicorn Malaysia's management team is currently headed by its acting CEO Thameem Ghouse who hails from Bahrain.
Vaseehar, who was named Unicorn Malaysia's chairman on Jan 1, this year, was previously the CEO and director of the Dallah Al Baraka Group in Malaysia for 16 years. He is responsible for building up Al Baraka’s Islamic banking activities in the country. He was also the former chairman of RHB Islamic Bank Bhd.
(The Malaysian Reserve, p32, July 28, 2008)

Saturday, July 26, 2008

More Islamic finance jobs (July/2)

Head of Operations (Islamic) - Qatar
A major new Islamic investment bank in the Gulf due to start trading
in the coming months is looking for an experienced hand who will
establish its operations department, from scratch.

Amanah Manager - UK
This is a more junior position. The employer is a global Islamic
banking division of the one of the largest banks in the world with 10
years experience. This is a sales role and they are looking for
someone who has an understanding or passion for Islamic Finance.
Fantastic opportunity for a personal banker or a junior private
relationship manager, says the adv.

Sunday, July 20, 2008

Islamic finance jobs - July

Experts of Islamic finance are in demand in Malaysia, the GCC and London. Here are just some samplings of the demand at this very moment. All above jobs were advertised at efinancialcareers (http://www.efinancialcareers.co.uk).

Head of Private Banking for Start - Up Islamic bank in Kuwait
Location: UAE
A start-up bank, aiming to be the best Islamic bank in Kuwaity/GCC, is looking to expand into private banking by taking on a Head of Private Banking who could build the Platform from green field.

Head of Islamic Financial Services, Europe
Location: London
A leading GCC bank is looking for a senior banker to head up its Islamic Financial Services team based in London. Remuneration: Highly competitive.

Senior Islamic Banking candidates
Location: London
A leading Global Investment Bank is actively seeking a senior Islamic Banking candidate to add to its Shari'a product development and distribution team.

Islamic Banking Relationship Manager - SVP for Corporate Banking
Location: Singapore
The manager is the primary point of contact between corporate/institutional customers and the bank. He is to maximise the amount of profitable business the bank do with that customer whilst ensuring the bank is only exposed to an acceptable level of risk.

Associate Director, Islamic Banking
Company: Standard Chartered Bank UAE
Location: UAE-Abu Dhabi
Candidate will identify, develop and manage SCB's Islamic Banking Business for wholesale bank. Achieve revenue target under Islamic banking, origination & client coverage (OCC).

Sr. Private Banker
Location: Bahrain
Company: A ‘large Islamic investment bank’ in Bahrain
With a focus on Islamic products, and most of the deals coming from Saudi Arabia, the bank is looking for one of the best in the business to cover the GCC region. Candidates must have at least 5 years private banking experience.

HR Director
Location: Bahrain
A ‘leading Islamic globally focussed investment bank’ is seeking a senior HR professional for a challenging HR Directorship based in the bank's Head Office in Bahrain.

Wednesday, July 16, 2008

Unicorn bank to begin operations next month


By Ishun P Ahmad & Habhajan Singh
Unicorn International Islamic Bank Malaysia Bhd (Unicorn Malaysia), the first Islamic bank licensed under the Malaysia International Islamic Financial Centre (MIFC) initiative, is set to begin operations in a month's time and expects to rake in profits by year-end.
The wholly-owned subsidiary of Bahrain-based Unicorn Investment Bank is already eyeing a number of deals.
"We have several deals in the pipeline, including a couple of mandates already signed, which our teams are working on. We will be able to close this year with some maiden profit," Unicorn Malaysia chairman Datuk Vaseehar Hassan told The Malaysian Reserve recently.
He said Unicorn Malaysia will utilise US$20 million (RM64.55 million) of its initial investment for its business in the country, which includes investment banking, corporate finance and treasury.
Elaborating on the deals, Vasheehar said Unicorn Malaysia is in talks with a number of banks from abroad on the possibility of structuring sukuk.
"These financial institutions are from non-Islamic countries. They do not yet have Islamic banking.
"We will work with them to develop Islamic sukuk in Asia and CIS (Commonwealth of Independent States)," he said. Unicorn Malaysia is the first foreign bank to have been licensed by the MIFC early this year.
The scope of the licence is wide, allowing the bank to create any Islamic banking product and take deposits as long as they are non-ringgit denominated transactions.
Unicorn Malaysia is the latest financial institution to step into the growing local Islamic finance sector, which includes foreign players such as Al Rajhi Banking & Investment Corp (Malaysia) Bhd, Asian Finance Bank Bhd and Kuwait Finance House (Malaysia) Bhd.
However, these players have been allowed to carry out ringgit-denomited transactions. Unicorn Investment Bank was founded in 2004 as an Islamic investment bank and has a presence in the United States, the United Arab Emirates, Turkey and Pakistan. Unicorn Malaysia's management team is currently headed by its acting CEO Thameem Ghouse who hails from Bahrain.
Vaseehar, who was named Unicorn Malaysia's chairman on Jan 1, this year, was previously the CEO and director of the Dallah Al Baraka Group in Malaysia for 16 years. He is responsible for building up Al Baraka’s Islamic banking activities in the country. He was also the former chairman of RHB Islamic Bank Bhd.
(The Malaysian Reserve, p1, July 17, 2008)

Monday, July 14, 2008

Sukuk ijarah widely accepted: Amanie's Dr Daud


By Habhajan Singh
Sukuk Ijarah, the underlying principle of Malaysia's first global sukuk in 2002, has been accepted as compliant by most Shariah boards, says an international Shariah scholar.
Sukuk ijarah has been accepted as compliant by many Shariah boards and scholars as well as the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) Shariah standards, with the exception of certain jurisdictions and scholars objecting to the put option at face value, says Dr Mohd Daud Bakar. Sukuk ijarah, an Islamic bond, is based on sale and lease back and carries a put option.
"Malaysia was the first sovereign to issue global sukuk in 2002 which paved the way for other sovereign issue similar sukuk such as the Bahrain, Qatar and Pakistan as well as Saxony-Anhalt of Germany," he said.
The topic of sukuk was at the heart of discussion for some 200 bankers from both Islamic financial institutions and conventional banks who attended the one-day Sukuk Seminar 2008 organised by Amanie Business Solutions in Kuala Lumpur yesterday.
Dr Mohd Daud, Amanie president/CEO of Amanie and also chairman of Securities Commission's (SC) Shariah Advisory Council, said the recent AAOIFI sukuk pronouncement have caused much apprehension and anxiety that the growth of sukuk issuance may suffer a backlash.
In February 2008, AAOIFI Shariah council chairman Sheikh Taqi caused a stir when he said that a whooping 85% of Gulf sukuks did not fully comply with Islamic laws. This brought sukuk, or Islamic bonds that notched global sales of up to US$30.8 billion (RM99.5 billion) last year, almost doubling sales the year before, under intense scrutiny of Shariah scholars and practitioneers.
Rafe Haneef, managing director of newly established Islamic investment company Fajr Capital, spoke on the implications of the AAOIFI pronouncement. He said sukuk must be backed by real assets, either physical, usufruct or services.
"If there are no real assets, say only a business plan, the sukuk cannot be traded until the business has acquired or invested into real assets," he said at the seminar.
Rafe, formerly Head of Islamic Banking for Citigroup Asia, added that the industry is advised to reduce the exposure on "debt-oriented" sukuk and shift towards a "profit-and-loss sharing" sukuk.
In mid-March, Standard & Poor's (S&P), in a report entitled 'The sukuk market continues to soar and diversify, held aloft by huge financing needs', said that the sukuk market growth will not be stunted by the recent debate among Shariah scholars about the Shariah compliance of the amount of sukuk issued so far.
Noting that the sukuk market more than doubled in 2007 to exceed US$60 billion, the rating believes the current debate is likely to introduce more standardisation and encourage innovation in this field.
Particularly the emergence of sukuk that are solely backed by assets and do not benefit from "credit enhancements" or thirdparty guarantees and associated features that add to a sukuk's creditworthiness.
(The Malaysian Reserve, July 15, 2008, p9, MONEY)

Islamic finance in Spore Business Times


In Singapore, Islamic finance products tend to be marketed, risk-managed and priced as analogous competitors to conventional instruments. For instance, takaful is marketed as 'Islamic insurance', sukuk is 'Islamic bonds', and AITAB or Al-Ijarah Thumma al Bai is 'Islamic hire purchase', writes Paul Ng in Singapore’s The Business Times. Ng, a former legal practitioner with experience in Islamic finance, now teaches law and economics at Ngee Ann Polytechnic.

Friday, July 4, 2008

NY firm on private equity funds


While Shariah compliance adds an additional layer of complexity to a fund, traditional private equity funds are uniquely positioned to take advantage of the growing market in the Middle East, says a client note from New York-based legal firm Latham & Watkins.

It said due to its investments in equity and risk sharing between investors and management, the traditional private equity fund fits nicely within the Shariah paradigm, adding that the standard management structure of a private equity fund is permissible under Shariah.

On Shariah supervision, the report noted that most Middle East private equity funds simply engage an already existing Shariah board (typically the Shariah supervisory board of the fund's sponsor or anchor investor). Alternatively, a fund may hire a Shariah consultant or establish its own Shariah supervisory board comprised of various Islamic scholars.