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Sukuk May Entice Canada to Issue $2 Billion

Bloomberg Businessweek
October 18, 2010
Ottawa, Canada

The growing demand for securities that meet Islamic religious principles may lead Canadian governments and companies to start issuing Shariah bonds.

HSBC Bank Canada may offer $500 million and three government-related borrowers from one Canadian province may issue $1.5 billion of sukuk, Omar Kalair, chief executive officer of Toronto-based UM Financial, said in an Oct. 14 interview. A “handful” of Canadian companies may sell C$1 billion ($980 million) of Islamic debt by 2013, said Daud Vicary Abdullah, global Islamic finance leader at Deloitte Corporate Advisory Services Sdn. in Kuala Lumpur.

Egypt, Nigeria, the Philippines and Thailand have announced plans to sell their first sukuk in the past three months, partly to tap Persian Gulf oil wealth. The combined wealth of the Middle East’s more than 400,000 millionaires grew 5.1 percent in 2009 to $1.5 trillion, Cap Gemini SA and Bank of America Corp.’s Merrill Lynch unit said in June.

“We would definitely be interested in a sukuk out of Canada,” Ramiz Moukarim, head of debt capital markets at Qatar Islamic Bank SAQ, who helps manages more than 1 billion riyals ($275 million), said in an Oct. 17 interview from Doha. “Whether it’s regional or federal, it doesn’t matter because of the nation’s rating. We’d have to look at their approach to the market, their pricing structure and the issuance size.”


'India Must Have Interest Free Banking'

An Islamic Finance Conference is about to be held in India. Proponents of Shariah Finance have been trying to move into India’s secular, conventional banking system for years. Now they’re touting via clever marketing that they have the interest-free advantage. What we call interest, Shariah Advisors and bankers are calling charges and fees. A rose by any other name...


The Financial Express
October 4, 2010
Kochi, India

India should open interest free banking windows in conventional banks as a pilot project, Muddassir Siddqui, a leading authority on Interest Free banking, today said.

Making a strong plea for launching Islamic Banking in India, Siddqui, Partner and Head of Islamic Finance, Middle East, SNR Denton and Company, told reporters here that there was lot of 'misunderstandings' regarding Islamic Banking in India. 'We are just asking for level playing field. We want it in conventional system. We do not want any favours', he said.

On issues relating to recovery in cases of loan defaults, he said it is done the same way as conventional banking.


Negative Outlook for Borcos Shipping Sukuk

Yet another sukuk in decline... Malaysia’s second-largest provider of offshore support vessels.


Business Times
September 29, 2010
Kuala Lumpur, Malaysia

SYARIKAT Borcos Shipping Sdn Bhd, Malaysia’s second-largest provider of offshore support vessels, had the A1 rating on RM160 million of Islamic medium-term notes placed on rating watch with a negative outlook at RAM Rating Services Sdn Bhd.


Weekly News Roundup: Citigroup Inc.

“Citigroup is looking to expand its Islamic bond sales, with an issue for a Turkish bank.“

September 26, 2010

Here’s a round-up of Citigroup Inc. (NYSE:C) news stories from this week. Citigroup Inc. (NYSE:C) company shares ended the week at 3.9 (as of 9/24/2010).

Weekly News Roundup: Citigroup Inc. (NYSE:C)

Tuesday 21 September

Citigroup Inc. (NYSE:C) is looking to expand its Islamic bond sales, with an issue for a Turkish bank. The new decision to boost the sales of Sukuk, the so-called ‘Islamic bonds’, was made after issuing $100 million for Kuveyt Turk Katilim Bankasi AS.

Hulusi Horozoglu, director of global Islamic banking at Citigroup said in an email statement that “We believe there is significant appetite for sukuk issuances, both on the issuer and investor sides, and we would expect to see greater volumes going forward. A key driver for this market will be the growth in Islamic banking at the retail level, which has shown tremendous growth over the preceding few years.”


Jordan Begins Studying Mechanism to Issue Islamic Sukuk

Jordan works to speed up issuance of sukuk and implementation of Shariah-compliant Finance “to provide funds for carrying out vital and top priority projects.”

The Jordan Times
September 19, 2010
Amman, Jordan

The government is working to speed up the use of Islamic-based financing tools as it has recently formed a committee to study mechanisms of issuing sukuk, Finance Minister Mohammad Abu Hammour said Saturday. In a statement to The Jordan Times, the official said the government is serious about using Islamic sukuk to provide funds for carrying out vital and top priority projects. He indicated that a government committee was formed recently to study legislative issues for issuing sukuk.

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