Islamic finance roundup: Saudi leads GCC sukuk issuances, global volumes to cross $200bn
Here's a roundup of key developments across the Islamic finance ecosystem during the month of September
Editor's note: Saudi Arabia is leading GCC sukuk issuances, with global volumes expected to surpass $200 billion in 2024. Meanwhile, Egypt is exploring green bonds and local sukuk to bring about economic stability across the country. Its Al Baraka Capital also launched the country's first Shariah-compliant investment fund to finance small industries businesses.
Investment
Egypt
Egypt explores green bonds, sukuk to ease debt
Egypt is actively pursuing economic reforms to stabilize its economy and reduce debt burdens.
The country's finance minister Ahmed Kouchouk discussed plans to issue green bonds and local sukuk with Hani Salem Sonbol, CEO of the Islamic Trade Finance Corporation, to boost investor confidence and economic growth, especially in food security and energy sectors.
The government is also planning tax reforms to simplify procedures for SMEs and freelancers. (State Information Service, Egypt)
Bahrain
CBB Sukuk Al-Salam securities oversubscribed
The latest Sukuk Al-Salam securities issued by the Central Bank of Bahrain (CBB) were oversubscribed by 185%, with subscriptions amounting to 79.572 million Bahraini dinar for a 43 million Bahraini dinar issue.
The securities have a maturity of 91 days, with an expected return of 6.13%, and are part of the ongoing short-term Sukuk Al-Salam series issued by the CBB. (Zawya)
Oman
Oman’s Islamic banking sector records substantial growth
Oman’s Islamic banking sector reached 7.8 billion Omani riyals in total assets as of June 2024, representing 18.1% of the country’s total banking assets.
The sector contributed 6.4 billion Omani riyals in total financing and saw a 33% increase in deposits. Despite a slight rise in impaired financing, the sector remains stable with a capital adequacy ratio of 15.8% and an 8.7% increase in profits in 2023. (Oman Observer)
Afghanistan
Agricultural Development Fund offers Mudarabah and Musharakah
Afghanistan's Agricultural Development Fund introduced Mudarabah and Musharakah to support farmers, distributing over 1.3 billion Afghanis last year and projecting 2 billion this year.
The initiative is part of ongoing projects to boost agricultural development, energy, water, and infrastructure projects in the country. (Ariana News)
Saudi Arabia
Saudi Arabia leads GCC as global sukuk issuances set to surpass 2023
Saudi Arabia is leading GCC sukuk issuances, with global volumes expected to surpass $200 billion in 2024, according to Moody’s.
The first half of 2024 saw GCC sukuk issuance surge by 138%, with Saudi Arabia accounting for 37% of the total. ESG sukuk volumes also hit record levels and are expected to continue rising. (Zawya)
Operational Development
Kazakhstan
Kazakhstan strengthens partnership with Islamic Development Bank, OPEC Fund, and Arab Coordination Group
Kazakhstan’s President Tokayev met with IsDB President Muhammad Sulaiman Al Jasser to highlight the bank’s role in the country's sustainable development, with over 70 joint projects worth $2 billion.
Tokayev also discussed infrastructure funding with OPEC Fund Director-General Abdulhamid Alkhalifa and praised ties with Gulf countries to attract $150 billion in foreign direct investment by 2029. (The Astana Times)
Bangladesh
Eastern Bank launches Islamic banking services
Eastern Bank PLC (EBL) has introduced Shariah-compliant Islamic banking services across 20 branches in Bangladesh, offering a range of products for its retail, SME, corporate, and trade clients.
The bank’s commitment to Shariah principles includes the launch of a unique product, "Continuous Musharakah Finance," designed to meet capital financing needs. (The Daily Star)
Egypt
AUB completes conversion of its Egypt operations from conventional to Islamic banking
Ahli United Bank (AUB) has successfully converted its operations in Egypt to Islamic banking, positioning the bank as a leading provider of Shariah-compliant financial solutions in the country.
The conversion is a key milestone in expanding the bank's Islamic finance footprint. (The Daily Tribune)
Kazakhstan
IsDBI completes pilot implementation of Islamic Finance Strategic Mapping Framework in Kazakhstan
The Islamic Development Bank Institute (IsDBI), in partnership with the Astana International Financial Centre (AIFC), has completed its Islamic Finance Strategic Mapping Framework (IF-MAP) in Kazakhstan.
The Kazakhstan Islamic Finance Country Report 2024, launched during the Astana Finance Days, offers key insights for investors and policymakers to drive the growth of the sector. (Zawya)
Company News
Bangladesh
Prime Bank launches Islamic Payroll Banking services
Prime Bank introduced Islamic Payroll Banking services to cater to businesses seeking Shariah-compliant solutions. The service offers employees benefits like zero balance accounts, no minimum balance, and daily profit on savings.
The bank aims to foster financial inclusion and ethical banking across 146 branches nationwide. (New Age)
Egypt
Al Baraka Capital, INVIA launch Sharia-compliant fund for small firms
Al Baraka Capital, in partnership with INVIA, launched Egypt’s first Sharia-compliant investment fund to finance small industrial businesses. The fund will initially provide 200 million Egyptian pounds in financing and is expected to grow to 1 billion Egyptian pounds by 2025.
Future plans include the issuance of green sukuk and additional Sharia-compliant funds. (Zawya)
Education
Global
IsDBI and INCEIF launch journal bridging Islamic finance and sustainable development
The Islamic Development Bank Institute (IsDBI) and INCEIF University launched the “International Journal of Islamic Finance and Sustainable Development” (IJIFSD), expanding the journal's scope to cover green finance, impact investing, and financial inclusion.
The journal aims to promote innovative research to address economic, social, and environmental challenges globally. (Africa Business Communities)
