#116 - August 2019 by CPI Financial

Dubai Technology and Media Free Zone Authority

ISSUE 116

ISSUE 116 LINKING GLOBAL VALUE CHAINS ENG. HANI SALEM SONBOL, CEO, INTERNATIONAL ISLAMIC TRADE FINANCE CORPORATION

LINKING GLOBAL VALUE CHAINS Eng. Hani Salem Sonbol, CEO, International Islamic Trade Finance Corporation

A CPI Financial Publication

PLUS:

10 FOUNDER’S MESSAGE:

A new journey

26 MALAYSIA:

How tech will transform Islamic finance’s future

38 SUKUK:

The need for sovereign guarantees

For generations, the better way to bank. Over 40 years ago, Dubai Islamic Bank pioneered a way of banking that was truly better: Islamic banking. Since then, many generations of customers continue to enjoy world class products and services backed by the very latest in banking technology. For them as for you, this is still the better way to bank.

dib.ae

CONTENTS

ISSUE 116

REGULAR SECTIONS

EDITOR'S LETTER

Greetings, all

elcome to Islamic Business

& Finance.

This is the 116th issue of the longestrunning Islamic finance magazine in the world. I hope you all are having a wonderful summer. There have been changes at CPI Financial that I'm sure some of you already know. Nigel Rodrigues, one of the founders of CPI Financial, has returned to the helm as CEO. Why now? As much as we talk about digital transformation in the industry, we are about to embark on one ourselves, as we launch a new website this fall. In addition, we have put renewed focus on our Awards programmes, adding more independent judges in order to best evaluate the excellence that the Islamic finance industry has to offer. Our founder and CEO wanted to take the time to speak directly to you our readers, so please turn to page 10 to hear his thoughts. Beyond that, there is plenty to peruse. I hope you enjoy digging into another great issue. Till next time,

OPINION

HALAL BUSINESS

22 Islamic economy offers host

Solving the overbanking problem

of opportunities for start-ups

NEWS + ANALYSIS

MALAYSIA

26 How tech will transform

News & Analysis

FOUNDER'S MESSAGE

10 Embarking on our next journey COVER STORY

Islamic finance's future

ISLAMIC BANKING

34 Increasing efficiency and broadening horizons

16 Linking global value chains

William Mullally www.islamicbusinessandfinance.net

Log on to www.islamicbusinessandfinance.com for news, polls, events, analysis, blogs, features, commentary and more.

ISSUE 116 | Islamic Business & Finance

P.O. Box 502491, Dubai Media City, UAE Tel: +971 4 391 4681 Fax: +971 4 390 9576 islamicbusinessandfinance.com

CONTENTS

ISSUE 116

FEATURES

CHAIRMAN

SALEH AL AKRABI CHIEF EXECUTIVE OFFICER

CHIEF OPERATING OFFICER

NIGEL RODRIGUES nigelr@cpifinancial.net Tel: +971 4 391 3722

SHERIF R. ELHUSSEINI sherif@cpifinancial.net Tel: +971 4 391 5419

EDITOR - ISLAMIC BUSINESS & FINANCE

WILLIAM MULLALLY william@cpifinancial.net Tel: +971 4 391 3718 EDITORS

GROUP SALES MANAGERS

NABILAH ANNUAR nabilah.annuar@cpifinancial.net Tel: +971 4 391 3726

NEEMA SAJNANI neema.sajnani@cpifinancial.net Tel: +971 4 391 3717

JESSICA COMBES jessica@cpifinancial.net Tel: +971 4 364 2024

NAP ESTAMPADOR nap.estampador@cpifinancial.net Tel: +971 4 433 5320

EDITORIAL ASSISTANT

KUDAKWASHE MUZORIWA kuda.muzoriwa@cpifinancial.net Tel: +971 4 391 3729 EDITORIAL

ADVERTISING

editorial@cpifinancial.net

sales@cpifinancial.net

SUKUK

CHIEF DESIGNER

SENIOR DESIGNER

BUENAVENTURA R. JALUAG, JR. jun@cpifinancial.net Tel: +971 4 391 3719

FLORANTE MAGSAKAY florante@cpifinancial.net Tel: +971 4 391 3724

38 The need for sovereign

DIGITAL MANAGER

DEO ABEJUELA deo.abejuela@cpifinancial.net Tel: +971 4 391 3722 EVENTS MANAGER

SHAIK MANSOOR shaik.mansoor@cpifinancial.net Tel: +971 4 365 4538

EVENTS MARKETING MANAGER

CRIS BALATBAT cris.balatbat@cpifinancial.net Tel: +971 4 391 3725

CONFERENCE PRODUCER

HITESHWAR BHAKHRI hitesh.bhakhri@cpifinancial.net TEL: +971 4 433 5322 FINANCE MANAGER

UMANG HANJ umang.hanj@cpifinancial.net Tel: +971 4 391 3727 HR & OFFICE MANAGER

RIZZA INFANTE rizza@cpifinancial.net Tel: +971 4 391 4682

ADMINISTRATION & SUBSCRIPTIONS

CAROL BASA carol@cpifinancial.net Tel: +971 4 391 3709

enquiries@cpifinancial.net ©2018 CPI Financial. All rights reserved. No part of this publication may be reproduced or used in any form of advertising without prior permission in writing from the editor.

guarantees to spur growth in debt capital markets

ISLAMIC TECH

42 Islamic finance in the age of digital transformation

OMAN

46 Islamic finance in Oman continues to grow

EVENTS

50 Dates for your diary

Fastest Growing Islamic Bank Winner

Get the next issue of Islamic Business & Finance before it is published. Full details at www.islamicbusinessandfinance.com ISSUE 116 Dubai Technology

Printed by Al Ghurair Printing & Publishing – Dubai, UAE

and Media Free

Zone Authority

Dubai Technology and Media Free Zone Authority

ISSUE 114

ISSUE 115

CEO, INTERNATIONAL ISLAMIC TRADE FINANCE CORPORATION

Islamic CEO, International Eng. Hani Salem Sonbol, Corporation Finance

A new journey

22 MALAYSIA: transform How tech will future Islamic finance’s

38 SUKUK:sovereign

EXPO 2020 AND THE ISLAMIC ECONOMY HE Majid Saif Al Ghurair, Chairman of Dubai Chamber of Commerce and Industry, Board member of DIEDC speaks exclusively to Islamic Business & Finance

PLUS:

18 DUBAI:

Islamic economy now 10% of GDP

22 MALAYSIA:

The next generation of Islamic finance

46 HALAL BUSINESS: Diversifying Saudi Arabia

A CPI Financial Publication

Islamic Business & Finance | ISSUE 116

PLUS:

10 FOUNDER’S MESSAGE:

UNLOCKING TAKAFUL’S GLOBAL POTENTIAL Abdulla Mohammed Al Awar, CEO, Dubai Islamic Economy Development Centre (DIEDC)

A CPI Financial Publication

Trade

EXPO 2020 AND THE ISLAMIC ECONOMY HE MAJID SAIF AL GHURAIR, CHAIRMAN OF DUBAI CHAMBER OF COMMERCE AND INDUSTRY

SONBOL, CHAINS ENG. HANI SALEM

AL LINKING GLOB S VALUE CHAIN

UNLOCKING TAKAFUL’S GLOBAL POTENTIAL ABDULLA MOHAMMED AL AWAR, CEO, DUBAI ISLAMIC ECONOMY DEVELOPMENT CENTRE (DIEDC)

LINKING GLOBAL VALUE

@IBFMag on Twitter for stories as they're being told

ISSUE 114

ISSUE 115

ISSUE 116

PUBLISHED BY CPI FINANCIAL FZ LLC REGISTERED AT DUBAI MEDIA CITY, DUBAI, UAE.

PLUS:

page 3-4 contents 114.indd 1

28 SUKUK:

The Sukuk industry and Aramco

32 NORTH AFRICA:

How Sudan attracted retail investors through Sukuk

44 ISLAMIC TECH:

Making Hajj and Umrah easier for travellers

28/04/2019 11:24

The need for guarantees

www.islamicbusinessandfinance.net

London Dubai (DIFC) Kuala Lumpur Formed in 1998 and established for over 20 years Intermediary services & systems solutions to connect the global Islamic ﬁnancial market responsibly DD&Co Limited Sharia’a Compliant Markets Asset Commodity Facilitation

DDGI Limited

ETHOS AFP™

Direct Investments & Strategic Partnerships

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Supporting Clients’ Sharia’a and Business Focused Requirements across Treasury, Capital Markets, Asset Management, Retail Banking & Insurance Products Responsible Asset & Commodity Inventory 24/7 Global Client Coverage

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Advertorial

Working with KSA Investors to

Achieve Future Diversification With the appetite growing for sophisticated investing in the Kingdom of Saudi Arabia (KSA), international finance centres (IFCs) that can demonstrate jurisdictional stability and offer a broad range of high-quality services and efficient structures will become increasingly valued. Those were amongst the findings of research recently published by Jersey Finance. The whitepaper, “Jersey – A Clear Choice for Saudi Investors”, examined the various approaches sought by investors in structuring inbound and outbound investments and pointed to the potential Jersey has to leverage this growing appetite. With more than 50 years of expertise in delivering private wealth management, trust, estate and succession planning and foundation structures, and having been working across the Middle East for many years, it’s clear that Jersey is in a strong position to play a vital role in the Kingdom’s growth story. In fact, Jersey has established itself as a leading jurisdiction for supporting the international wealth and succession planning of families in the Gulf region, and investors continue to find genuine appeal in the expertise, substance and stability Jersey can offer as an IFC, as well as its range of tried-and-tested wealth products. As this latest paper reveals, against a backdrop of shifting markets and a changing global political landscape, investors more than ever need access to professionals that have the specific expertise to navigate the complex landscape – skills and expertise that Jersey can offer in abundance.

Why Jersey for International Investment? Expertise

Substance

Jersey has one of the largest number of finance industry professionals of any IFC, giving it a vast pool of expertise.

A modern business environment with almost 14,000 professionals supported by a politically stable government.

Connected

Expertise

Jersey has strong links and is in close proximity to the City of London and the EU, giving businesses and individuals easy access to both markets.

Our highly skilled workforce and key stakeholders work together to develop products and services. This focus adds value to local and global economies, as well as the futures of individual investors.

Independence While we often work closely with Britain, we’re not part of the UK or represented by the British Houses of Parliament. We’ve maintained this domestic autonomy for 800 years, which will continue to bring benefit in the post-Brexit future.

Central It has a central time zone, making it easy to do business around the globe.

Legal System Our legal framework provides vital support to our finance industry, making sure that we stay flexible and attractive for domestic and international markets.

Communications We have world leading business communication links, including high speed telecoms, together with cutting edge information technology and postal services.

Advertorial

J E R S E Y

•

L O N D O N

•

D U B A I

•

M U M B A I

•

H O N G

K O N G

•

S H A N G H A I

•

N E W

Y O R K

Diversifaction

Evolving

In particular, the new research underlines how recent changes in oil prices have reinforced the importance of diversification amongst the Kingdom’s wealthy population. It demonstrates how Saudi family offices and high net worth individuals (HNWIs) have sought to diversify their portfolio in a manner that is more immune to commodity and oil price fluctuations by combining domestic investments with international activity.

There’s no doubt that the environment is evolving, and there is real potential for Jersey to play a central role, working with investors and families in the KSA to support their internationally-focused investment and succession strategies.

It also emphasises the fact that, just like other Gulf neighbours, wealth remains very personal in the KSA. As such, estate planning is perhaps one of the most important, but often overlooked, priorities. With this in mind, the research found that, while the holding structure most widely used by Saudi family offices and HNWIs in an IFC is a simple holding company owning various investment special purpose vehicles, larger family offices have been moving increasingly towards more complex structures, foundations and trusts that offer considerable benefits in addressing wealth preservation, estate planning and investment diversification goals.

Not only does Jersey maintain a leading status in complying with the highest international standards, but it also offers tax neutrality, a broad range of structures, jurisdictional stability, proximity to European centres, a robust and flexible regulatory framework, and an expert workforce of almost 14,000 professionals. Over five decades Jersey has developed an infrastructure that is absolutely geared up to supporting investors with global ambitions and, given their priorities as highlighted in this latest paper, this should resonate clearly with investors and families in the Kingdom. By Richard Nunn Head of Business Development at Jersey Finance

For more information, please contact a member of the Jersey Finance team on: +971 (0)4 289 0490

jersey@jerseyfinance.je

www.linkedin.com/company/jersey-finance

www.jerseyfinance.je

www.youtube.com/jerseyfinance

@jerseyfinance

Key Features of Jersey’s IFC for Gulf Investors Jurisdiction’s Regulatory Environment

Tax Efficiency

To ensure the right tax is being paid, regulation is needed. Jersey’s strong regulatory framework sets it apart from other IFCs. Our framework is one of the strongest in the world, and it’s designed to bring clarity and transparency to the world of finance.

Jersey offers a clear, tax-neutral environment, allowing investors to work together more efficiently. They pay tax in their own countries, and in those they invest in, without complex crossborder tax issues – and without being taxed twice.

Choice Reputation Jersey adheres to, and is often an early adopter of global standards set by the UK, EU, US and the Organisation for Economic Cooperation and Development (OECD).

In over five decades, Jersey has developed a breadth and depth of competitive products and services.

Jurisdictional Stability Jersey has its own elected Parliament and judicial system, bringing jurisdictional stability and freedom of independence.

JERSEY

FRANCE

OPINION

Solving the overbanking problem I

s the UAE overbanked? It’s a question that has come up more and more in my conversations throughout the industry. After all, a population of 9.5 million is being served by over 50 local and international banks. According to many, mergers and acquisitions is the best path forward, driving efficiencies and profitability. “Many smaller banks in the Northern Emirates do not have the balance sheet to compete with larger banks. Cost synergies, better economies of scale, and a more diversified loan book make an appealing case for bank mergers. In light of increased regulation such as IFRS 9 and Basel III, merging small players would allow for healthier competition,” said Ali Al Adou, Head of Asset Management, Daman Investments. But it’s no longer a matter of what should, could, and might happen. Fitch Ratings believes that Islamic banking mergers and acquisitions are set to increase. “Many Islamic banks still lack the market position needed to compete with large established peers, particularly in overbanked markets such as the UAE, Fitch Ratings says. Consolidation should ultimately be positive for the Islamic banking sector by creating larger, stronger and more efficient Islamic banks. However, banks' Issuer Default Ratings will typically be unaffected, given that most GCC bank ratings are driven by our assumption that sovereign support will be provided to banks (directly or through a parent bank), if needed,” said Bashar Al Natoor, Head of Islamic Finance, Fitch Ratings. In the UAE, Dubai Islamic Bank and Noor Bank are likely to merge, it was announced this summer, which would create a more sophisticated leading Islamic player, benefiting particularly from cost efficiencies and product and business development, according to Fitch Ratings.

Islamic Business & Finance | ISSUE 116

Al Hilal Bank, it seems, will adopt the Emirates Islamic model. “Emirates NBD, a leading conventional bank, has a unique business model in the UAE, doing most of its Islamic financing through a subsidiary, Emirates Islamic, rather than an Islamic window. It seems likely that Abu Dhabi Commercial Bank will adopt this model following its acquisition of Al Hilal Bank,” says Natoor. How much more M&A will appear in the UAE in the Islamic banking sector? It remains to be seen, but according to all signs, it will happen sooner rather than later. The time to act is now.

William Mullally

Editor

www.islamicbusinessandfinance.net

NEWS & ANALYSIS

Indonesia is planning further steps to make it easier for foreign banks to invest in local lenders as well as encourage domestic mergers, as it tries to strengthen the sector against growing competition from financial technology firms, reported Bloomberg. The single presence rule was introduced in 2006 to push consolidation among the 2,000 or so local banks, however it proved unpopular with some of the foreign lenders seeking to expand their operations in Indonesia.

The single presence policy will be flexible so that there is consolidation and our banks become more efficient, foreign banks are still interested in coming to Indonesia because the net interest margin is still high at around five per cent.â&#x20AC;? HERU KRISTIYANA, the Commissioner for Banking Supervision at the Financial Services Authority of Indonesia

Turkeyâ&#x20AC;&#x2122;s Eti Krom has hired JPMorgan Chase & Co. to raise $250 million from debut US dollar-denominated Islamic bonds issuance, reported Bloomberg.

The ferro-chrome producer, based in the city of Maslak near Istanbul, will use the money from the five-year securities for capital expenditure and other working expenses. We want to boost our financial credibility in the Middle East, that is why we will issue Sukuk instead of conventional finance.â&#x20AC;? EVREN OZTURK, the Chief Financial Officer of Eti Krom

www.islamicbusinessandfinance.net

ISSUE 116 | Islamic Business & Finance

FOUNDER'S MESSAGE

EMBARKING ON OUR NEXT JOURNEY

NIGEL RODRIGUES, FOUNDER AND CEO OF CPI FINANCIAL, RETURNS TO THE HELM. WE SIT DOWN WITH OUR PIONEER AS HE SHARES HIS THOUGHTS ON THE MARKET AND SHEDS LIGHT ON THE FUTURE OF ISLAMIC BUSINESS & FINANCE

s one of the founders of CPI Financial, the publisher of Islamic Business & Finance and Banker Middle East, what have been your thoughts since returning to the role of CEO? As a board director and shareholder, I’ve always kept updated as to the challenges facing publishers in an ever-changing world, one that is dictated by the rapid advances in technology. It’s an exciting time to be back at the ‘helm’ of CPI Financial. I am exceedingly proud to say that this year celebrates the 20th anniversary of Islamic Business & Finance’s sister publication Banker Middle East. I find the region to be quite transient, with people coming and going and the same applies to magazines and newspapers. When we launched Islamic Business & Finance, our main aim was to satisfy the needs and requirements of our readers and clients alike and we clearly succeeded. Now, we’re embarking on our next journey.

Islamic Business & Finance | ISSUE 116

What are your priorities for the future of CPI Financial? The embracing of new technology is the only way forward, identifying new opportunities. Of course, we mustn’t forget the key roles that editorial integrity and objectivity play, without this, we will be just another business magazine without an opinion! When I was a young and impulsive sales manager back in the 1990s, I was told by my client, “Nigel, if you do not listen, you do not learn”. It is so true; how can we learn if we do not listen! If we think we know best, we’re sadly mistaken. I have ingrained in me, the need for research into what our readers want and to listen to criticisms as well as accolades, as this makes us a stronger business and one that continues to be supported by the industry. It’s the simple law of ‘supply and demand’ done well. We have a new and experienced team in place

NIGEL RODRIGUES, Founder and CEO of CPI Financial

www.islamicbusinessandfinance.net

FOUNDER'S MESSAGE

We have removed the ‘voting’ element which has been replaced by an expert judging panel of ratings agencies, accountancy firms and auditors as well as members of the CPI Financial team. NIGEL RODRIGUES

www.islamicbusinessandfinance.net

ISSUE 116 | Islamic Business & Finance

FOUNDER'S MESSAGE

and I’m truly amazed at the talent we have at CPI Financial. Each and every team member excels in their field of expertise and the true excitement is what new technology will bring. Our tech team comprises sharp and slick young professionals from across the globe who know how to take advantage of the technology available, now and in the future. I have no doubt in my mind that we will be around in another 20 years, as long as we keep listening and adapting. Who knows what the world will look like then? Virtual banks! No banks! The Islamic Business & Finance Awards, much like Banker Middle East Industry Awards, have been a landmark event in the banking and finance industry in the region for approaching two decades. What is your vision for the awards moving forward and what changes can we expect to see? We designed the Islamic Business & Finance Awards and the Banker Middle East Awards to reward excellence in the banking community. Banks needed to be benchmarked and we knew things were going to change but we did not realise

The deviation from petrodollars will be one of the major ‘markers’ in the near future. The region has demonstrated its ability to recognise this need and change accordingly, and I’m sure we will see and experience things that we would have never imagined! NIGEL RODRIGUES

how fast those changes would be. Being a Dubaibased company, we witnessed and experienced the incredibly rapid growth of the banking and financial sector with the greater emphasis on compliance and corporate governance as well as huge profit opportunities.

Islamic Business & Finance | ISSUE 116

Competition is healthy and the hunger for the awards has always been strong. Once again, we listened and have chosen to make some changes to make the event and a more transparent and enjoyable evening. One of the ways we have done that for the Islamic Business & Finance Awards is that we have removed the ‘voting’ element which has been replaced by an expert judging panel of ratings agencies, accountancy firms and auditors as well as members of the CPI Financial team. Banking and financial institutions can nominate themselves in the relevant categories and will then be asked to make a submission from a template supplied by the Islamic Business & Finance editorial team. These submissions will be reviewed in detail by the judging panel. The successful institutions that have been shortlisted, will be informed on 1 October and the winners will be announced on 23 October. CPI Financial has undergone numerous managerial changes over the last couple of years. Does your return signal an end to this and what can we see from the company in the future? It’s always a challenge in any business finding the right people to lead. Ability, hunger, determination and passion are the four qualities that I see in myself and so I look for the same. Sadly, it is very rare to find all four and three is often not good enough. As one of the founders and a shareholder, I believe I have an unrivalled and unique passion that cannot be found anywhere else. The key to success of any business is firstly, having the right product and service, and secondly, having the right team in place to deliver. I’m extremely confident in the abilities of all my colleagues and am always on the search for new talent to expand the business. There is already, a new and stable level of confidence to drive the business to greater successes. As I said earlier, technology is the way forward. Whilst I’m desperate to tell you all about our plans, I think it best if you wait and experience the new products and services we will have to offer! What are your thoughts on the current banking and finance landscape in the Middle East? The Middle East is an economically and diverse region that includes countries with a common heritage, at various stages of economic and social development, but with vastly different

www.islamicbusinessandfinance.net

FOUNDER'S MESSAGE

degrees of natural resources. The banking and finance sector is at the heart of a country’s economic development. The region’s financial institutions have proved to be resilient despite the ‘nightmare’ years of 2008 onwards. However, with global regulatory reform becoming a priority, institutions are facing major challenges as well as sweeping changes. A secret of success is to turn these challenges into opportunities. Opportunities for growth and diversification. Technology is once again the ‘major player’ here. The institutions who embrace and utilise the rapid advances in technology to enhance the service offering, will be those that exceed the expectations of customers and shareholders and deliver healthy returns.

I have no doubt in my mind that we will be around in another 20 years, as long as we keep listening and adapting. NIGEL RODRIGUES

As relatively young markets compared to those that are more mature such as the US, UK and Europe, consolidation is a natural progression. The boom times always provide the perfect platform to launch new institutions but when markets stabilise, it is generally found that the law of ‘Economy of Scale’ kicks in and institutions acquire other institutions. This not only stamps out the competition but also provides access to domestic and international capital as well as being able to compete with larger banks to win and retain customers. I am sure we will see more mergers and acquisitions in both the conventional and Islamic banking communities as the industry looks to compete with new entrants. There is also no doubt that technology will change the global banking and financial sector forever. The deviation from petrodollars will be one of the major ‘markers’ in the near future. The region has demonstrated its ability to recognise this need and change accordingly, and I’m sure we will see and experience things that we would have never imagined!

www.islamicbusinessandfinance.net

What role does Islamic Business & Finance play in supporting the Islamic banking and finance community through the challenges that the industry often faces? I’ve always seen the publication as the ‘authoritative voice’ for Islamic banking and finance across the world and I am proud that we play an integral part as both a conduit and platform for institutions to discuss developing trends and the current issues being faced by the banking and finance community. Our thought leadership platforms have proven to be an extremely useful tool for institutions to actively meet and discuss their products and services with a targeted audience. We invest a great deal of time and money in research to ensure that we are always ‘ahead of the curve’, providing clients with the resource to make informed decisions on their business going forward. We frequently discuss the new technologies available and how they can enhance an institutions efficiency and client offering. We address ‘hot topics’ such as risk and compliance and given global trends, it is crucial that institutions fall in line. We will continue to debate the critical issues facing our industry in the hope that they will inspire further debate and will result in positive changes. CPI Financial is now in its 20th year. How are you planning to mark the occasion? It’s an extremely proud year for the team at CPI Financial, it’s not often you can say that you work for a 20-year-old Dubai-based banking magazine. Of course, it’s not just about magazines. We have been writing specialist books for the same period and continue to offer this unique service which is enjoying renewed popularity. In addition to our all our tailor-made events, we offer a comprehensive platform across print and digital formats. We are currently going through a restructuring process and have been evaluating all of the products and services we offer, to ensure they meet and exceeds the needs of our clients. We intend to celebrate with our loyal clients as we did for our 10th anniversary but it is a little early to discuss our plans! I would like to thank one of my fellow founders, Dominic de Sousa who sadly passed away three years ago. Dom was an inspirational businessman who not only made me laugh hysterically but gave everybody an opportunity to succeed or fail! His unique style is sorely missed.

ISSUE 116 | Islamic Business & Finance

AWARDS SUBMISSION BRIEF ABOUT ISLAMIC BUSINESS & FINANCE

Fastest Growing Islamic Bank Winner

Winner Fastest Growing Islamic Bank

SUPPORTED BY

ORGANISED BY

Islamic Business & Finance, the authoritative voice of the global Islamic finance industry and the broader Islamic economy, has a worldwide circulation that spans every continent. Celebrating its 14th anniversary in 2019, Islamic Business & Finance is the oldest continuously published magazine covering the Islamic finance sector. It is published by CPI Financial—based in Dubai since 1999—offering a comprehensive portfolio of market-leading periodicals, products and services tailor-made for the banking and financial sector. As part of our mission, we have, since our inception, held the Islamic Business & Finance Awards in order to award the pioneers of the Islamic banking and broader financial sector. As the Islamic finance industry continues to grow and innovate, our awards programme will continue to recognise the pioneers in the Islamic finance landscape and laud their many achievements that are integral to the industry’s continued growth.

METHODOLOGY After each and every awards ceremony, together with feedback from the industry, throughout the year, we conduct our own research and look closely at what categories are most relevant in the current climate, new entrants that have impacted the industry, and most importantly, how we manage client expectations. We critically review our production and are always looking for improvement. As a result of our findings, we have identified 26 award categories that provide regional recognition to exceptional financial institutions across the wide spectrum of banking and finance. Institutions can nominate themselves in all relevant categories as deemed appropriate, provided the submission is sent in before the deadline, and in the required format. The judging panel comprises senior executives from ratings agencies, accountancy and auditing firms, together with members of the Islamic Business & Finance editorial team.

ENTRY GUIDELINES There are two stages to complete an entry for our awards programme:

Stage 1 Candidates must first send in their nominations to ibfawards@ cpifinancial.net by the nomination deadline of 29th August 2019. Institutions can nominate themselves for as many categories as they wish, provided they are able to produce the supporting materials in Stage 2 of this process.

Stage 2 An entry submission template will only be sent to institutions that have nominated themselves. All submissions must strictly follow the submission template provided and must be sent back to ibfawards@ cpifinancial.net by 19th September 2019. Submissions received after the deadline date will not be considered. Whilst we understand the hectic yearly schedules, we aim to foster a competitive environment that is fair to all parties—both award participants as well as the judging panel. Submissions for an award category must distinctly point out how and why your institution stands out above the rest. Depending on the award contended for, each submission should highlight any new product/initiatives/innovation/level of service/comprehensiveness/ efficiency—any means that could demonstrate overall competitiveness and outperformance amongst your peers across these markets, relevant to the award in question. The submissions may also include any infographics that you deem helpful to support your case.

RESULTS Following critical examination of all submissions, the judging panel will select their shortlisted institutions and this shortlist will be announced on or after 10th October 2019. The winners for each category will be announced at the Islamic Business & Finance Awards gala dinner on Wednesday 23rd October 2019.

ADDITIONAL INFORMATION For further clarification on the awards submission process kindly contact: ibfawards@cpifinancial.net For more information on the Awards Gala Dinner and to book tables, please kindly contact: ibfawards@cpifinancial.net

AWARD CATEGORIES TRAINING, RESEARCH & CONSULTANCY Best Training Institute RATINGS Best Ratings Agency TAKAFUL Best Takaful Operator Best ReTakaful Operator TECHNOLOGY Best Fintech Company DIGITAL BANKING Best Digital Banking Proposition CORPORATE FUNCTIONS Best Advisory Service Best Human Capital Development Initiative Best Sustainability Initiative RETAIL BANKING Best Retail Bank CORPORATE BANKING Best Corporate Bank INVESTMENT BANKING Best Investment Fund Best Investment Product Best Investment Bank Best Investor Relations ASSET MANAGEMENT Best Asset Manager Best REIT Manager Best Sukuk Arranger SME BANKING Best SME Bank PRIVATE BANKING Best Islamic Wealth Management Proposition PREMIUM BANKING Best Premium Banking Institution PERSONAL BANKING Best Home Finance Institution ISLAMIC WINDOW

SUBMISSION DEADLINE 29th August 2019

Best Islamic Window LEADERS IN ISLAMIC BANKING & FINANCE Fastest Growing Islamic Bank

IB&F AWARDS DINNER/GALA

23rd October 2019 The Ritz-Carlton DIFC, Dubai, United Arab Emirates

Best Islamic Bank Outstanding Contribution to Islamic Finance (individual award) Award submissions will be critically evaluated and mutually analysed, utilising market knowledge, research and relevant company financial statements, before a shortlist is made. The winners will be chosen from this shortlist and announced at the awards ceremony. The evaluation period for all awards is typically based on a 12-month cycle.

COVER STORY

LINKING

(Agarianna76/SHUTTERSTOCK)

GLOBAL VALUE CHAINS

Islamic Business & Finance | ISSUE 116

www.islamicbusinessandfinance.net

COVER STORY

ITFC is working in Gambia on eradicating the aflatoxin fungus from Gambia’s peanut crops.

ENG. HANI SALEM SONBOL, CEO, INTERNATIONAL ISLAMIC TRADE FINANCE CORPORATION, WRITES FOR ISLAMIC BUSINESS & FINANCE ABOUT THE DEVELOPING WORLD’S POTENTIAL

ompanies and individuals the world over do best when integrated into global value chains. It provides companies with opportunities for growth and operational efficiencies; and offers individuals, entrepreneurs and employees wider career prospects. In the developing world, more needs to be done to advance trade so that more and more businesses can unlock their potential by participating in the global value chain—a crucial step towards inclusive growth, enhancing trade and boosting shared prosperity. In the developing world in particular, these partnerships can go a long way in successfully implementing targeted trade finance and export mobilisation strategies that have direct impact on the livelihoods of people. The underlying

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ISSUE 116 | Islamic Business & Finance

COVER STORY

goal should be the creation of jobs in fastgrowing economic sectors with high untapped export potential. Value chains are an integral part of regional integration as well as linking countries and regions to the global economy. As value chains in OIC (Organisation of Islamic Cooperation) countries flourish, neighbouring countries and entire regions (Islamic or otherwise) stand to benefit from a virtuous cycle of sustainable growth and longterm prosperity. Trade finance is, however, only part of the solution. Autonomous financial institutions like the International Islamic Trade Finance Corporation (ITFC) for instance, have the responsibility as catalysts to mobilise private and public resources, so that enterprises (in particular SMEs) in developing countries can gain access to a wider choice of financing options. They should also provide businesses with the necessary trade-related

Islamic Business & Finance | ISSUE 116

capacity building tools to help them successfully compete in the global market and boost exports.

ENRICHING GLOBAL VALUE CHAINS â&#x20AC;&#x201C; A KEY COMPONENT IN BUILDING SUSTAINABLE ECONOMIES In general, trade-related international support tends to focus on the integration of Least Developed Countries (LDCs) into the global economy by advancing economic and employment growth as well as financial flow. By UN definition, LDCs are low-income countries challenged by many structural impediments to sustainable development, such as political instability, vulnerability to natural disasters and epidemics, and a high reliance on natural resources. In 2018, out of the 47 countries included in the LDC category, 23 were OIC Member Countries. Many of these countries are highly dependent on the agricultural sector as major contributor to

ENG. HANI SALEM SONBOL, CEO, International Islamic Trade Finance Corporation

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COVER STORY

GDP and source of employment. Although there has been increased foreign direct investment flow to LDCs in recent years, it has been unsteady at best. This has led to the inevitable creation of large informal economies within many of LDCs, and needless to say they remain locked out of the global economy. Trade finance institutions are therefore required to step up efforts towards closing the trade finance gap and providing the necessary solutions to support domestic, inclusive and sustainable development in LDCs. In recent years, ITFC has shifted its focus towards achieving this goal. Today, one third of all ITFC financing, amounting to $ 1.7 billion in 2018,

technical assistance and capacity building programmes to enhance the quality of goods and commodities for export into the global economy. In the agriculture sector, key areas of intervention must therefore include critical areas of the value chain, from farm input to processing, pre-export, and export. Through a strategic partnership with the Enhanced Integrated Framework (EIF), global development programme and an affiliate of the World Trade Organisation (WTO), ITFC has been able to jointly implement a key programme, including the Gambia Aflatoxin Mitigation programme, which is aimed at eradicating aflatoxin fungus and enhancing the quality of the groundnut produced in The Gambia for local consumption and for export into key European and other international markets.

LEAVE NO ONE BEHIND

It is the collective responsibility of international trade finance institutions to create an environment for inclusive intraregional growth and pave the way for the world’s poorest countries to join the global economy in a sustainable manner. There is an ever-growing need to boost cooperation in trade development and trade capacity enhancement, in addition to developing a framework for bilateral and regional cooperation and coordination. – ENG. HANI SALEM SONBOL, CEO, International Islamic Trade Finance Corporation

is directed towards 14 member LDCs from the OIC. In 2018, ITFC provided $750 million of financing to strategically important value chains, in key sectors such as cotton, groundnuts and coffee, which is intended to bring stability and better livelihoods to over 600 000 farmers in member countries. In additional to financing, emphasis is put on supporting and implementing trade-related

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Given the extent of the development gap, the issue of poverty and inclusive growth cannot be tackled alone. International partnerships and support both from public and private sector sources are needed to provide market access, fair trade and innovative solutions especially for developing countries. This is why strategic partnerships are integral to ITFC’s development approach. In 2018 alone, through working with partner organisations and tapping into private sector funding to support trade finance activities in member LDCs, ITFC mobilised an additional $1.39 billion in external resources. It is the collective responsibility of international trade finance institutions to create an environment for inclusive intraregional growth and pave the way for the world’s poorest countries to join the global economy in a sustainable manner. There is an ever-growing need to boost cooperation in trade development and trade capacity enhancement, in addition to developing a framework for bilateral and regional cooperation and coordination. In the world of trade finance, an approach of ‘leaving no one behind’ in terms of financial, economic and social inclusion is necessary. It is what will ultimately drive the creation of robust, export-driven economies upon which regional and global value chains can be built. This is how we can unlock exciting, sustainable and autonomous trade ecosystems, support inclusive growth, advance trade and improve lives.

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HALAL BUSINESS

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HALAL BUSINESS

Islamic economy offers host of opportunities for start-ups ISLAMIC BUSINESS & FINANCE SPEAKS TO SHIMMY MATHEW, CHIEF FINANCIAL OFFICER, KBW INVESTMENTS

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ISSUE 116 | Islamic Business & Finance

HALAL BUSINESS

ow much potential do you see in the Islamic economy from an investment perspective?

I think the Islamic economy offers boundless opportunities; especially for start-ups. This is the still under-served — and often untapped — market share that entrepreneurs are looking for when they are founding a new venture. This is especially true for segments that are still relatively nascent like FMCG and the Islamic hospitality sector. So-called ‘dry hotels’ aren’t a niche market; there is a huge demographic of clients that seek this out when planning trips for both business and for leisure travel. Building on the FMCG example, our sister company KBW Ventures has invested in Geltor. Briefly, Geltor is a B2B deep tech company that develops plantbased collagens and gelatin for use in cosmetics and foodstuffs. The obvious implication here is that the whole Islamic economy — and those that observe Kosher as well — will opt for products that are made

While Shari’ah compliance is clearly more of financial or business-centric type term, for those that are familiar with it, it does inspire confidence in the overall ethical footprint of the company itself. – SHIMMY MATHEW, Chief Financial Officer, KBW Investments

with Geltor’s scientifically-advanced ingredients. Products made with Geltor’s patented collagen and gelatin will become the preferred products for two simple reasons: no part of the cosmetic or food product will be derived from swine, making it extremely attractive for those who are observant in terms of faith, and the ingredient quality and breadth of application is truly excellent. Certified Halal, Geltor’s N-Collage is the first-ever vegan collagen technology, and it was awarded the “Innovation of the Year” title at the 2018 CEW Beauty Awards. It is quite a prestigious honour to receive from a majorly influential B2B cosmetics body.

Islamic Business & Finance | ISSUE 116

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HALAL BUSINESS

KBW is greatly focused on sustainability and ethical concerns, do you feel that there is a lot of overlap between those concerns and Shari’ah compliance? Sustainability, ethical business, and Shari’ah compliance are highly compatible. So many parallels exist, not just in terms of governance, but in terms of who you can cater to in the market. While Shari’ah compliance is clearly more of financial or businesscentric type term, for those that are familiar with it, it does inspire confidence in the overall ethical footprint of the company itself.

Diversify investments and assets in your portfolio to ensure that you weather various markets shifts. – SHIMMY MATHEW, Chief Financial Officer, KBW Investments

I feel the major gap in knowledge lies in terms of the lay consumer knowing what exactly Shari'ah compliance entails — this would be more of a communications issue and would need some type of strong marketing to really be taken advantage of in the wider sense. That said, Halal and Kosher certifications are widely understood and thus inspires confidence in vegan markets for example, when determining if swine byproducts were or were not used in the production process.

Does Shari’ah compliance extend past just the businesses that you work with to your operations?

SHIMMY MATHEW, Chief Financial Officer, KBW Investments

KBW Investments works across manufacturing, development, and construction mainly. While these companies aren’t certified Shari’ah-compliant as a financial operation would be, we are in line with Islamic principles. Our only officially compliant business, Crestmount Capital, was divested recently through a sale to a private individual.

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What are you working on now? What do you have planned for the future? Presently, our efforts are concentrated on Arada. We are in the process of handing over Phase 1 of Arada’s first community, Nasma Residences in Sharjah. Arada’s Chairman recently presented the keys to the very first homeowner in Nasma Residences during a small ceremony; it was the first of 107 homes in Phase 1 to be handed over. It is worth noting here one of the value adds consistently mentioned by Nasma’s homeowners is the proximity of Sharjah’s largest mosque. During our sales phases, this was often alluded to by our customers as a desirable factor. The mosque itself was opened by HH Sheikh Dr Sultan bin Muhammad Al-Qasimi, Supreme Council Member and Ruler of Sharjah, and garnered a significant amount of attention due to its capacity of 25,000 and for its stunning architecture and design schema.

What is your personal finance philosophy? I have a few rules that I believe are important in terms of personal finances. Do not over leverage; you should be extremely aware of your limitations. When considering new investments, conservative heads prevail. Diversify investments and assets in your portfolio to ensure that you weather various markets shifts. And finally, it is essential to save a minimum of 20 per cent of your income. This will see you through any unexpected occurrences, financial or otherwise.

ABOUT KBW INVESTMENTS KBW Investments, a portfolio group based in Dubai, United Arab Emirates, works across a diverse array of sectors. Founded in 2013, the KBW Investments group of companies are active in sectors including construction, manufacturing, engineering, project management, automation, technology, and more. The existing portfolio includes both larger scale established heritage companies and younger enterprises poised to scale. Areas of Group interest include early stage technology investments, driven primarily by the Group’s founder and Chairman HRH Prince Khaled bin Alwaleed bin Talal in his capacity as founder and Chief Executive Officer of sister company KBW Ventures.

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MALAYSIA

How tech will transform Islamic financeâ&#x20AC;&#x2122;s future DATUK NOR SHAMSIAH MOHD YUNUS, GOVERNOR, BANK NEGARA MALAYSIA, WRITES ABOUT THE MEGATRENDS AFFECTING MALAYSIA, AND HOW ISLAMIC FINANCE COULD STAND TO BENEFIT

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( bluefish_ds/BLOOMBERG)

MALAYSIA

or much of history, human civilisation could not reasonably explain how ocean tides occurred. It was only through the discovery by Sir Issac Newton and the dedication of scientists over many centuries that we are able to understand it today. Like ocean tides, the future of finance may be hard to fathom at the beginning. Yet it offers many opportunities and risks. Perhaps most importantly, it also underscores the heavy responsibility and ownership that we collectively bear to build a

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financial system that is safe, reliable and truly serves the needs of the people. The world around us is shifting dramatically. To understand this shift, we should pay attention to five megatrends. The first is the shift in global economic order with the rise of Asia, including the rising prominence of ASEAN. The gravity of the global economy is moving to the East. Being the sixth largest economy and home to around 650 million people, there is an abundance of opportunity, hope and dynamism

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MALAYSIA

in this region. The financial sector will no doubt, be a key player in further catalysing the growth of ASEAN countries. The second is the risks brought about by climate change. Tackling climate change may be one of the biggest challenges for humanity in building a sustainable and prosperous future. It could lead to devastating, wide ranging and irreversible damage to our economy, society and the way we live. Economic losses in itself could be very significant, as high as $20 trillion. Insured losses from effects of climate change have already increased five-fold in the past 30 years. The third is the rising income inequality that can threaten the fabric of our society. Consider this. The top one per cent of the population has captured twice the global income growth of the bottom 50 per cent since 1980. Worse still, inequality has persisted despite large transfers of public to private wealth in many countries.

Tackling climate change may be one of the biggest challenges for humanity in building a sustainable and prosperous future. It could lead to devastating, wide ranging and irreversible damage to our economy, society and the way we live. â&#x20AC;&#x201C; DATUK NOR SHAMSIAH MOHD YUNUS, Governor, Bank Negara Malaysia

( Nadirah_Zakariya/BLOOMBERG)

cont. on pg 30

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DATUK NOR SHAMSIAH MOHD YUNUS, Governor, Bank Negara Malaysia

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Photo credit: Bloomberg

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MALAYSIA

The fourth is the rising populism and protectionist policies. This can be seen in inward looking policies and anti-establishment views that have become more entrenched in parts of the world. Slow growth, lack of economic mobility and erosion of trust in public and private institutions are among the factors that are likely to have contributed to this. Like undercurrents before a storm, these trends have far reaching implications for political, economic and social systems. Last but not least, the fifth shift is the advancement of technology. This has and will continue to dramatically alter the way we behave, interact and transact. Much has been said about the benefits, but an increasing reliance on technology presents risks that we cannot ignore. This includes issues of data privacy, discrimination or biases and also displacement of certain segments within society. In the digital age, higher order risks of cyber-attacks and operational disruptions are magnified in ways that we have yet to fully comprehend. These five megatrends and finance are deeply intertwined. While undoubtedly finance has helped to power the economic rise of ASEAN, its role in contributing to an increase in climate risk and inequality cannot be denied. Therefore, as we consider the future of finance, we need to contemplate not only how these megatrends may impact finance, but how finance itself can respond to and shape these trends in more positive ways moving forward. In my mind, this calls for a financial system that is relevant, safe and socially responsible. Finance must be relevant to the needs of the economy. This means that it must offer suitable, cost-effective and quality financial products and services for all segments of society. It must also respond to the changing demographics and structure of the economy. For example, as we move towards becoming a digital economy, the financial sector must accord adequate support to innovative SMEs, such as those involved in e-commerce. Equally important, we must remember that this imperative is not only for banks, but extends to the other parts of the financial sector. Non-banks such as venture capital and private equity firms, as well as alternative financiers such as factoring and leasing companies, have an equal stake in this and should also play a more active role in financing the needs of businesses. The need to bridge the gaps between 20th century finance and the 21st

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century economy is both compelling and urgent for the whole financial sector as conditions remain challenging for the economy domestically and abroad. This is also certainly not the only time that we will face such challenges. To be safe, finance must not sow the seeds of its own destruction and not serve as an amplifier of risk to the economy. The ability of finance to mobilise capital, create leverage and distribute risk allows it to be a powerful force for good. But excessive and unbridled risk taking creates instability which is harmful not only for the particular firm, but the economy and society at large. There is also a greater need for finance to be socially responsible. Financial institutions can and must assert the much needed leadership in

In the digital age, higher order risks of cyber-attacks and operational disruptions are magnified in ways that we have yet to fully comprehend. â&#x20AC;&#x201C; DATUK NOR SHAMSIAH MOHD YUNUS, Governor, Bank Negara Malaysia

a world where the continued neglect of equitable d e ve l o p m e n t a n d a r a p i d l y d e t e r i o r at i n g environment is displacing communities, raising social and political tensions, and putting future generations at grave risk. Finance still holds the trust of society and substantial influence over economic agents. But this is a privilege earned, and demands that financial institutions behave ethically, and act in the best interest of the communities they serve. There is no question that technology will lie at the very heart of these imperatives for the financial system. This has been true for decades, only the order of its impact is now, arguably much greater. After all, the worldâ&#x20AC;&#x2122;s first ATM in 1967 transformed the relationship between people and money and making finance more accessible. Today, fintech signals the next phase in the transformation of finance.

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MALAYSIA

GLOBAL ISLAMIC FUNDS AuM BY DOMICILE AS AT END-MAY2019

OTHERS

12.6% INDONESIA

3.3%

LUXEMBURG

4.8%

MALAYSIA

36.2%

JERSEY

11.3%

SAUDI ARABIA

31.8%

SOURCE: MIFC estimates

Fintech holds enormous potential to enhance competition, increase productivity, address unfulfilled consumer demand and fundamentally change the way institutions provide financial services â&#x20AC;&#x201C; in ways we may not even have fully discovered. Similarly for Islamic finance, adoption of technology could present significant opportunities to reduce the cost of financial intermediation and expand access. For example, distributed ledger technology could enable automated execution of contracts through the use of digital protocols, or smart contracts, which can simplify complex Shariâ&#x20AC;&#x2122;ah contractual processes. In addition, fintech initiatives to integrate social finance tools, such as Waqf, Sadakah and Zakat, to offer more affordable financial and protection solutions, will be instrumental to serve those who are currently financially underserved or excluded. The integration of social finance into Islamic financial services encourages wealth distribution among society to achieve greater balance between wealth creation and wealth sharing. Ultimately, fintech in Malaysia should be harnessed to offer inclusive, sustainable and relevant financial products and services to serve

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the needs of all. This however means that we need to be cognisant of the potential risks associated with technology. This will be especially important as fintech and big tech firms become more prominent in the financial system. Such firms could pose systemwide vulnerabilities that can amplify shocks to the financial system and cause financial and economic instability. Increasing reliance and concentration on third party service providers, including those located offshore, to support critical functions, could also increase operational vulnerabilities in more unpredictable ways The demands of society for speed, convenience and cost efficiency are at a point where substantial tensions already exist between pressures on financial institutions to accelerate the adoption of technology, and our capacity to manage those risks effectively. These tensions will only increase going forward. Managing these tensions at an optimal level will be critical. It will call for changes to how financial institutions internally oversee and manage technology risks, both within and across their business activities, invest in hard and soft infrastructure and having much deeper collaboration across institutions and agencies.

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MALAYSIA

Socially responsible finance will also require institutions to carefully consider how technological innovations may create new forms of financial exclusion or raise difficult ethical questions. Clear guidance on acceptable conduct by staff and relevant parties will be needed. This in turn, will require financial institutions to reflect on their core values and risk appetite. In short, managing technology risks is not just an operational matter. It is a strategic one with high stakes for individual institutions, as well as the industry and the economy more broadly. Our response should be commensurate with these stakes. Beyond measures taken at an institutional level, there is a pressing need for the financial industry, and indeed even the nation, to provide an enabling and secure framework for technological innovation; and educate and empower the public to take advantage of innovations. For example, the need to formulate a cohesive, coherent and comprehensive national strategy on cyber security is an urgent need. We can only play our intended role to support the broader economy if we are attentive to both strategic and operational considerations of risk. Bank Negara Malaysia is committed to play a facilitative role to enable innovation to flourish. Like financial institutions, we need to balance the significant benefits of financial innovation with its risks. We are also mindful that the calls we make in regulating and supervising the industry can themselves sometimes, restrain innovation. Our responses to new financial technologies will continue to be primarily concerned with the risks that they pose to financial stability and consumer protection. In finding the right balance in our overall regulatory and supervisory posture, we will continue to consult widely with the industry and experts in the field. A key priority for the Bank is to ensure that our regulatory and supervisory system is appropriately calibrated to encourage innovation, but also has the agility to shift gears when required to respond to new risks. This recognises that innovation without stability ultimately destroys value, confidence and undermines our future. What does this mean in practice? There are at least three things, which are each a reflection of our ongoing efforts to build an enabling, yet safe environment for innovation: First, building interoperable infrastructures. This will start with open and fair access to a

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shared payment infrastructure for banks and non-banks alike. It is also important to recognise the need for other digital public infrastructures as key enablers to harness the full potential of fintech. These include having a national digital identity system, framework for open API and open banking, clear cloud policy and nationwide broadband connectivity. Second, further differentiating our regulatory and supervisory approach to capture new sources and transmission of risks while allowing room for experimentation and for firms to develop economies of scale. An important objective will be minimising regulatory arbitrage, which can lead to risks building up in parts of the financial system that may be subject to differentiated regulations. We anticipate that this will call for a much more dynamic approach to regulation and supervision as well as better communication of regulatory developments going forward. Th i r d , s t r e n g t h e n i n g p l a t f o r m s f o r collaboration. In this regard, the Bank, together with the financial industry, is in the process of establishing a Financial Threat Intelligence Platform. The platform will collate, analyse and disseminate real time information on cyber threats and trends to strengthen the detective capabilities of the industry against such threats. We expect to operationalise the platform before the year end. I am also pleased to announce the establishment of a dedicated innovation lab, right here in Sasana Kijang. The lab will provide a collaborative environment for the purpose of creating, elaborating, and prototyping innovative solutions to clearly defined problem statements. Recall that ocean tides present us with both opportunities and risks. The fact that humanity today is better able to understand, predict and master ocean tides should give us encouragement for the future of finance. The goal of a relevant, safe and socially responsible financial system can be attained by focusing our energies toward this shared goal in which we all have a critical stake. Much like a â&#x20AC;&#x153;rising tide that lifts all boatsâ&#x20AC;?, the actions and choices that we make within the financial system do not just affect the provision of financial services, but have important implications for the well-being of society and our economic prospects as a nation. We owe this not only to ourselves and others at this point in time, but especially to our future generations.

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IN AN EXCLUSIVE INTERVIEW, HAYTHAM ELMAAYERGI, GLOBAL HEAD OF TRANSACTION BANKING AT ABU DHABI ISLAMIC BANK, TALKS ABOUT SHARIâ&#x20AC;&#x2122;AH COMPLIANT TRADE FINANCE

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ISLAMIC BANKING

hat are your views on the trade finance landscape in the region and how does ADIB play a role in it?

delivering a tailored package of products which can enable them to meet these goals.

Trade finance plays a crucial role in driving the UAE’s economic growth by boosting the country’s access to goods and services, as well as help achieve the development goals underpinned by job creation, national prosperity, and better living standards. Trade finance also drives the nation’s economic diversification efforts and fosters the UAE’s goal of becoming a major regional and international trading hub. Currently, the UAE remains the largest exporter and importer in the region, with non-oil foreign trade valued at AED1.63 trillion per annum. ADIB supports this by providing an extensive suite of Shari’ah-compliant solutions designed to facilitate fast and efficient trade transactions, including financing, payment facilitation, risk mitigation and data management. These solutions help importers and exporters finance their crossborder flows whether on documentary trade or open account trade.

What challenges do you face in conducting the business?

How does the transaction banking needs of various types of clients differ? As a long-term proponent of the UAE private sector, ADIB provides a broad spectrum of Shari’ah-compliant products that support local businesses, particularly exporters and business customers, allowing them to manage their working capital in an efficient and effective manner. We have experience working across different sectors, understanding the objectives of the particular client in question and then

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While the trade finance sector has grown over the years, it is still laden with challenges as a result of over-reliance on paper. This includes inefficiencies, high costs and risks associated with manual processes. A lack of standardisation also poses a significant constraint on potential growth, with a lack of appropriate regulations likely to slow progress. Differences in interpretation and variations in product structures, and reporting standards are areas that still need to be improved. Another point of contention is the shortage of financing available for small to medium-sized enterprises (SMEs). According to estimates from the Asian Development Bank, the global trade finance gap is currently at about $1.4 trillion.

Ta k i n g t h e a b o ve i n t o consideration where do you see opportunities?

The global transaction banking market set to be worth

509

Banks in the Middle East are set to catch a larger portion of the global transaction banking market set to be worth $509 billion by 2025, given its strategic position as the by gateway to international trade. Trade finance is an area that could reap advantages from blockchain technology as it could reduce paperwork and complexity. Through digitalisation, ADIB sees opportunities to simplify the trade finance process, thereby driving efficiency, reducing time and costs, boosting transparency and mitigating risks, while broadening access to trade finance. In addition, a harmonisation in standards and regulations will tap into potential productivity and growth in trade transactions. ADIB also recognises the rising demand for Shari’ah-compliant financial instruments. Export finance and supply chain finance present the greatest opportunities for Islamic banks since these are the areas from which Islamic banks have traditionally been absent. At ADIB, we are developing sophisticated

BILLION 2025

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ISLAMIC BANKING

Islamic products that fill these gaps with appropriate Shari’ah structures, technology and an efficient service model to support this.

How does your pipeline look like for the rest of the year and going into 2020? Global transaction banking is a growth business for ADIB, and the bank is investing heavily in building digital solutions to meet the working capital needs of companies across all industry segments. ADIB’s digital transformation plan will define the tools that can transform the way in which our clients transact. Through our new online banking platform, clients can now execute transactions and obtain financing against the different trade instruments digitally. ADIB also taps into the huge potential of Islamic trade finance, which is currently underrepresented in the global financial system despite

Global transaction banking is a growth business for ADIB, and the bank is investing heavily in building digital solutions to meet the working capital needs of companies across all industry segments. – HAYTHAM ELMAAYERGI, Global Head of Transaction Banking at Abu Dhabi Islamic Bank

the rising demand for Shari’ah-compliant financial instruments. We recently launched a significant number of products that focus on Islamic trade finance including export financing and trade receivables financing. These trade finance solutions were traditionally missing from the Islamic banking sphere and are the requirements which clients now look for in Islamic trade finance.

What are your expansion plans for ADIB’s trade finance business? ADIB has joined a consortium of banks led by Etisalat Digital to use technology to improve efficiencies, automation, and transparency in the trade finance process. Through this partnership, ADIB and Etisalat will develop the UAE Trade Connect (UTC), a nationwide

Islamic Business & Finance | ISSUE 116

trade finance platform that utilises blockchain, artificial intelligence, and advanced detection tools to validate the authenticity of transactions, and safeguard banks from potential risks related to double financing and fraud. We believe that a collaborative effort among banks to create a unified network necessary to support global payments is the biggest key in terms of transforming blockchain’s potential into reality. As part of its digital transformation strategy, ADIB is investing $100 million in technology, revamping all delivery channels and banking platforms to enable customers to conduct their banking in a simpler and more intuitive manner. ADIB’s plan to entirely digitalise Islamic trade finance is set to be completed very soon. When launched, it has the capability to deliver a complete and seamless end-to-end Islamic financing process, thereby driving transformative business value to clients.

HAYTHAM ELMAAYERGI, Global Head of Transaction Banking at Abu Dhabi Islamic Bank

What is your outlook on 2019? We see digitalisation and standardisation as major disruptors in the trade finance sector. Banks will capitalise on advancements in technology, developing their product range to address the ever-changing needs of customers. Islamic banks, as well as conventional players, need to be at the forefront of technological developments, exploring new paradigms, such as blockchain, to improve the end-to-end client experience.

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23 SEPTEMBER 2019

Transforming Banking for the New Consumer

Mina A’Salam, Madinat Jumeirah Dubai, United Arab Emirates

SPEAKERS INCLUDE:

Ahmad Abu Eideh

Chief Executive Officer United Arab Bank

Emre Karter

Treasury and Trade Solutions Head Citibank

Fahad Al Semari

Chief Transformation Officer Riyad Bank

Sanjay Malhotra

Chief Digital Officer Dubai Islamic Bank

Ramana Kumar

SVP & Head of Payments First Abu Dhabi Bank

Yazeed Al-Khalifa VP – Governance, Risk and Compliance Saudi Payments

Gold Sponsor

Lanyard Sponsor

Exhibitor

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bmesummit.net

For more information, please email: events@cpifinancial.net or call +971 4 365 4538

SUKUK

The need for sovereign guarantees to spur growth in debt capital markets 38

Islamic Business & Finance | ISSUE 116

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SUKUK

PRICING AND EASE ARE WORLDWIDE ISSUES FOR SUKUK. SAUDI ARABIA MAY HAVE FOUND A PATH FORWARD

Mohammed Almuaalemi/BLOOMBERG

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or those institutions and government bodies worldwide that are considering issuing a Sukuk, especially those that are not issuing Sukuk for religious reasons, the cost of borrowing is a key concern. Value is key for the global debt community, and thus, lowering the cost of borrowing is a needed development. While the need remains, most countries have yet to fully solve this problem—thoughsome are working in order to address it. “With exception of few (including Malaysia), many countries lack such initiatives that lead to lowering the cost of borrowing on issuers. But things are changing in the GCC,” said Mohammed Khnifer, Debt Capital Markets (DCM) Banker at Supranational Banking Institution. “In late 2017, Saudi Arabia issued a royal decree that public institutions and municipalities will henceforth be able to issue bonds and Sukuk (with sovereign guarantee). The initiative by itself is a landmark as it has the potential to deepen and develop the Saudi debt capital market. Whether Saudi municipalities ready or not, that’s another question,” said Khnifer. While Sukuk issuances often take time to come to fruition, Saudi Arabia has made other moves as well. “In May 2019, Saudi Real Estate Refinance Co (SRC), modelled on US mortgage finance firm Fannie Mae, informed the market that it became eligible for sovereign guarantees on its planned issues of Sukuk. While there is no much details

ISSUE 116 | Islamic Business & Finance

SUKUK

on the technicalities of such credit enhancement, one should be aware there are full guarantees (100 per cent of the principle) or partial,” said Khnifer. “One of the pillars of within Islamic/conventional debt capital markets’ ecosystem is insurance / guarantee related products. Setting up an Islamic guarantee insurer for debt instrument can become a catalyst to stimulate growth as well as enabling corporates to access the market at better borrowing rates. To make an economic sense, such entity should be rated “AAA” in order to make a difference in uplifting the credit rating of the potential issuer, subject to 100 per cent guarantee as well as compliance with Shari’ah guidelines of third-party guarantee.” Difficulties remain for Saudi Arabia, however, both in terms of the difficulty of using Sukuk compared to bonds, and, as always, in terms of pricing, both of which are long-standing challenges for the instrument.

FACTS: - I slamic municipal bonds: There are at least two issuers of Islamic municipal Sukuk, Anhalt Municipal Sukuk (2004) in Germany and Sukuk Pasir Gudang in Johor Malaysia. - Danajamin Nasional Berhad, established in 2009,is Malaysia’s first and only Financial Guarantee Insurer. The entity has catalysed growth in the domestic corporate bond/Sukuk market as an alternative source of financing to complement the banking industry.

“While this process will be managed and regulated by the Debt Management Office (DMO), there are some challenges. First most of the eligible issuers are not ready as there is a learning curve on such sophisticated instruments (even though from credit perspective, there will be demand for such securities). The second challenge is that they need to price the Sukuk correctly, and there is a lack of specialists in this area (within potential issuers). One would argue about the conflict of interest of the investment banks. After all, what is the use of such guarantee if the issuer is getting eventually a mispriced Sukuk,” says Khnifer. Government guarantees, thus, are likely to be important for Saudi municipalities.

Islamic Business & Finance | ISSUE 116

Funding requirements

ISSUERS

Pays profit/coupon & principal

AAA-RATED Sukuk/Bonds

Invests

Returns

INVESTORS

Guarantees Sukuk/Bonds Issued AAA credit enhancement

Provision of Guarantee Facility for Sukuk/Bonds Issuance

Payment of Guarantee Fee

DANAJAMIN NASIONAL BERHAD

Payment of coupon/profit and principal on behalf of issuer should issuer fail to do so

“Sovereign guarantees are not considered part of the debt to GDP. They will be viewed as contingent liabilities. Governments will be better granting guarantees than issuing bonds/Sukuk on their balance sheet (in which proceeds are channeled to municipalities),” says Khnifer. As of 31 July 2018, Saudi has provided numerous guarantees in respect of the indebtedness of Government-owned entities: First came guarantees by the Ministry of Finance in respect of the 10-year SAR 15 billion ($4 billion) Sukuk and the 10-year SAR 15.2 billion ($4.1 billion) Sukuk issued by GACA in January 2012 and October 2013, respectively; and a guarantee in respect of Saudi Arabia’s operating costs in connection with the Prince Mohammed bin Abdulaziz Airport in Medina, which is counterguaranteed by receivables from Saudi Arabia.

MOHAMMED KHNIFER

Mohammed Khnifer can be reached at mkhnifer@gmail.com and on twitter at @mkhnifer

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SAVE THE DATE 19 November 2019

Mina Aâ&#x20AC;&#x2122;Salam, Madinat Jumeirah Dubai, United Arab Emirates

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ISLAMIC TECH

Islamic finance in the age of digital transformation

(Travel man/SHUTTERSTOCK)

DR ESKANDAR SHAH, ASSOCIATE PROFESSOR AND ASSOCIATE DEAN SCHOOL OF GRADUATES & PROFESSIONAL STUDIES, INCEIF

Islamic Business & Finance | ISSUE 116

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ISLAMIC TECH

ecades of global peace and economic prosperity have not shielded some parts of the world’s population from experiencing extreme poverty. Moreover, inequality remained profound in certain jurisdictions due in some parts to the weakness or shortcomings of the current economic and financial practices. Paradoxically, since 1990, CEO compensation has increased by 300 per cent and corporate profits have doubled but the average worker’s salary has increased only by four per cent (Economic Policy Institute, 2015). In fact, if the salary increment is adjusted for inflation, the minimum wage has actually decreased. In the recent past, on average 26 richest billionaires own as many assets as the 3.8 billion people who make up the poorest half of the planet’s population (Oxfam International, 2019). The aphorism “a rising tide lifts all boats” sounds more like a myth than a solid economic argument. It is also unsettling, perhaps shocking, to observe that despite the proliferation of financial sectors globally, about 1.7 billion adults remain unbanked, without an account at a financial institution or through a mobile money provider (World Bank, 2017). One would wonder, what prevents the banking sector to include a sizable global community and why financial inclusion remains a challenge in many parts of the world. The fact that an inclusive society is a necessary condition to end human misery from extreme poverty poses a serious question on the efficacy of the current banking system. Distressingly, these problems seemed to be more pertinent in the Muslims countries and indicated an obvious gap in Islamic finance that needs to be urgently addressed by improving the ability to intermediate the Muslim world’s resources to meet their own needs more effectively.

www.islamicbusinessandfinance.net

ISSUE 116 | Islamic Business & Finance

ISLAMIC TECH

Critics of Islamic finance are of the view that the less prevalence of Islamic finance in the worldwide act of combatting these economic issues could be due to its tendency to replicate the economics and risk profile of conventional products. The questions remain why Islamic banking is not evolving, and why the likelihood of convergence between Islamic and conventional banking. Is it the failure of policy makers? Or the current ecosystem does not favour the practice of true Islamic banking. No doubt, in a world where asymmetry information is a common feature, risk sharing contracts are anathema to the role of banking as financial intermediaries, in particular guaranteeing deposits with positive return. Will Islamic finance be any different in the future? I strongly believe cultivating innovation is what it takes for Islamic finance to step out of the shadow and resolve its own â&#x20AC;&#x2DC;crisis of identityâ&#x20AC;&#x2122;. Creative thought should be encouraged to accentuate the true value-added proposition of Islamic finance,

Islamic Business & Finance | ISSUE 116

including risk-sharing, fairness, social justice and inclusiveness. Social based instruments such as Zakat and Waqf are often repeated in the various conferences and seminars as tools to ascend the status of Islamic finance. Nonetheless, institutions that are in charge of these tools seemed to be weak in governance and are unable to build trust as much as the banking institutions. In fact, the isolated success of several institutions invariably depend on strong support from government or leadership of charismatic individuals. Unlike the banking system that has evolved to become more inclusive, these social based institutions remain unsophisticated and operate on a small scale which impede their growth. Having said that, I believe the solutions are still within our reach. As much as we need the banking system to continue to play its role in promoting growth, there is a greater need for non-financial institutions such as zakat and waqf to scale up

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ISLAMIC TECH

DR ESKANDAR SHAH, Associate Professor and Associate Dean School of Graduates & Professional Studies, INCEIF

their operation and address some of the outlined challenges. It is important that these institutions are well accepted not only because they adhere to Islamic principles but also due to a better and fairer business models. Nonetheless, one would argue how smaller institutions can replicate the success of gigantic banking system. One possible way to do so is by making use of digital technology to promote its services to greater outreach to previously unserved and/or underserved. In the age of technological disruption, we have seen business models in most industries have been transmuted into platform-based services. A reliable technology not only enhances reachability but builds trust and changes the precept of the users. Technology eases scaling and replication, thus making it easier for a successful model to be implemented elsewhere. In a much broader set-up, venturing into digital transformation is imperative as Islamic finance set to become disintermediated, it will help the industry’s key players to employ different types of classical Shari’ah contracts including profitsharing, leasing and many more in designing their products and services that suit specific customers’ financial needs best, apart from a traditional loan. As a result, Islamic finance is able to refrain itself from being trapped in the maze of debt creation and money lending, just like in conventional finance. Moreover, the flexibility of fintech allows these firms to circumvent rigid regulatory requirements in banking system and offers various products that cater to the needs to the Islamic finance industry. In addition, the same flexibility allows strategic

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collaboration between Islamic financial institutions and technology companies in the effort to create a fertile environment to nurture innovation in Islamic finance. Last but not least, Islamic finance with the help of digital technology can also capitalise on the rise of small and medium enterprises (SMEs) and start-ups, which look to tap the 1.8 billion Muslims worldwide to sell their goods. The International Finance Corporation (IFC) of the World Bank Group has estimated a potential gap of $8.63 billion to $13.20 billion for Islamic SMEs financing across the nine surveyed countries in MENA, while only 36 per cent of more than 160 surveyed banks in that region had an SME offering (IFC, 2016). To fill this gap, a new digital exchange, known as Huulk, was established to attract listings from Shari’ah-compliant financial technology start-ups. In Malaysia, the Islamic Digital Economy Framework (Mi’yar) was released by the Malaysian Digital Economy Corporation (MDEC) to serve as a guide for start-ups and venture capitalists who wish to understand digital economy and available financing facilities from the Shari’ah point of view. The digital economy has been identified as a key growth driver for Malaysia, contributing 18.2 per cent to the country’s gross domestic product in 2016 (MDEC, 2018). Moreover, digital technology can also be a conduit for revitalising the roles of Islamic wealth management in modern days. For instance, Wahed Invest, a New York-based Islamic digital wealth management company, managed to raise $8 million from MENA investors through its Halal and ethical online investment platform in 2018. In addition, its robo-advisors are available to assist the investors to make investment decisions in diversified portfolios comprising of socially responsible stocks, Sukuk, gold and other commodities in compliance with Shari’ah tenets. Moving forward, Islamic finance should put an end to the imitation game and drive innovation within itself instead. Being a follower, but not a leader, has witnessed Islamic finance to have not had peculiar solutions to many economic problems and social illnesses in the Muslim countries as many of us wish to see. It is now the time that academician and policy makers to see solutions from a different lenses and not just through the existing system.

Dr Shah can be reached at: eskandar@iceif.org

ISSUE 116 | Islamic Business & Finance

OMAN

Islamic finance in Oman continues to grow I ACCORDING TO H.E. MR. TAHER BIN SALEM BIN ABDULLAH AL OMARI, EXECUTIVE PRESIDENT OF THE CENTRAL BANK OF OMAN, THE SULTANATE HAS ONE OF THE HIGHEST ISLAMIC ASSET GROWTH RATES IN THE WORLD

Islamic Business & Finance | ISSUE 116

slamic finance in Oman is thriving. There are more financial institutions currently offering Islamic finance products or working under a Shari’ah framework than ever before, and this is due in no small part to the regulatory environment that has allowed the financial system to grow and prosper. “Since the start of Islamic banking in Oman we have achieved legal framework for this and there are 82 outlets which are offering Islamic services. The Sultanate has one of the highest Islamic assets rates

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OMAN

in terms of growth and all the indicators for this are encouraging,” said HE Mr. Taher bin Salem bin Abdullah Al Omari, Executive President of Central Bank of Oman, to commemorate the opening of the second annual Salalah International Islamic Finance Conference in Salalah, Oman in July. “We have secured deposits based on Islamic regulations and we are working hard to see initiatives in the future,” continued bin Salem al Omari. The three-day event, organised by Tawafuq Consultancy and Muscat Clearing and Depository Company, was held under the patronage of H E Sheikh Khalid bin Omar bin Said al Marhoon, Minister of Civil Service. The conference included a presentation of working papers under four main themes: Islamic finance and economic diversification, contemporary issues in Islamic finance in terms of Sukuk issuance procedures and their role in development, in addition to the legal aspects of Sukuk, and importance of the role of supporting organisations of Islamic finance, as well as various seminars. Dr Ali Muhi’eddin al Qara Dhaghi, Secretary General of the International Union of Muslim Scholars, Ashraf Hashim, CEO of ISRA Consultancy Malaysia, and a number of specialists and interested persons in the Islamic finance sector from inside and outside the sultanate took part in the conference. On the sidelines of the conference, specialized workshops, focusing on a bankers, legal professionals, researchers and those interested in Islamic finance and economics, including professors, students and postgraduate researchers, were held. In the main panel discussions, which featured a number of CEOs from the top Islamic institutions in Oman, liquidity was a particularly pressing issue. “Today’s discussion about liquidity in the market especially is very important. This has been one of the main challenges for Islamic banks, the fact that liquidity is not available for us given there is no framework yet for our novel industry when it comes to managing liquidity and meeting the requirements of these institutions in a fairly new sector,” Khalid Al Kayed, CEO of Bank Nizwa, said. In addition to Islamic finance and economic diversification, contemporary issues in Islamic finance including electronic and digital currencies, and the various types of Sukuk and issuance procedures came under the spotlight. The conference also reviewed the challenges and solutions of banks, Takaful insurance, reinsurance, the governance of

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Islamic financial institutions, the legality of the Sukuk, its legal aspects and the Sultanate’s experience of the issuance of Sukuk. " We heard from experts and specialists on Islamic banking as they reflect on the development of this crucial sector which has provided customers with Shari’ah-compliant banking solutions. It is also well known that the Islamic banking system has played an important role in meeting the needs of the people by providing high-quality banking services. This is confirmed by the growth witnessed and is also the result of prudent guidance from the Central Bank of Oman, which spares no effort in providing all support to Islamic banks in the Sultanate,” Moosa Al Jadidi, COO, Alizz Islamic Bank, said. Islamic finance has had a transformative role on communities across the Sultanate of Oman, according to the head of Sohar Islamic. “It was an honour to support and be a part of the 2nd Salalah International Financial Islamic Conference. The event brought together international industry experts to share knowledge and the latest research regarding the Islamic financial sector and products; making our participation in and support of the event natural. By bringing together stakeholders and researchers from across the world, the event has helped further the growth of Shari’ahcompliant banking in Oman and facilitated greater understanding among all practitioners for the benefit of our customers, partners, and stakeholders. We are pleased to have sponsored and been a part of this pivotal annual forum, and we look forward to continuing to play a strategic role in advancing Islamic finance within the nation,” said Salim Khamis Al Maskari, DGM and Head of Sohar Islamic. In early August, The High Shari'ah Supervisory Authority held its second meeting of the year at the premises of Central Bank of Oman. The meeting was chaired by Sheikh Dr. Kahlan Bin Nabhan Al Kharoosi and was attended by all the members. In the meeting, the Authority made detailed deliberations on the issues presented to them with respect to various Shari’ah aspects relating to Islamic banking, including Shari’ah-compliant liquidity management products for islamic banking entities. Accordingly, the Authority gave its opinions and observations on these issues in light of the discussions. The Authority was also briefed about a follow-up report on the actions taken on the issues discussed in the previous meeting, according to the Central Bank of Oman.

ISSUE 116 | Islamic Business & Finance

SAVE THE DATE! 26 NOVEMBER 2019

The Ritz-Carlton DIFC, Dubai, United Arab Emirates

BANKER MIDDLE EAST INDUSTRY AWARDS 2019

Best Bank in the Middle East

WINNER

For over 20 years, Banker Middle East has been serving the banking and financial community in the region. We are the longest-running GCC-based banking publication, continuously supporting the industry, providing informed commentaries, news, in-depth articles and analyses. As part of our integral role in the regionâ&#x20AC;&#x2122;s banking sector, we benchmark, recognise and actively encourage excellence within institutions. The Banker Middle East Industry Awards 2019 will give due recognition to the outstanding institutions that have shaped and continue to shape the financial landscape. Such achievements should be lauded accordingly, and as we have grown with the industry, we would like to thank you for your continuous support for the Banker Middle East Industry Awards, without which we would not be able to produce the most prestigious event in the banking calendar.

METHODOLOGY

SUPPORTED BY

ORGANISED BY

After each and every awards ceremony, together with feedback from the industry, throughout the year, we conduct our own research and look closely at what categories are most relevant in the current climate, new entrants that have impacted the industry, and most importantly, how we manage client expectations. We critically review our production and are always looking for improvement. As a result of our findings, we have identified 31 award categories that provide regional recognition to exceptional financial institutions across the wide spectrum of banking and finance. Institutions can nominate themselves in all relevant categories as deemed appropriate, provided the submission is sent in before the deadline, and in the required format. The judging panel comprises senior executives from ratings agencies, accountancy and auditing firms, together with members of the Banker Middle East editorial team. Award submissions will be critically evaluated and mutually analysed, utilising market knowledge, research and relevant company financial statements, before a shortlist is made. The winners will be chosen from this shortlist and announced at the awards ceremony. The evaluation period for all awards is typically based on a 12-month cycle.

AWARD CATEGORIES

ENTRY GUIDELINES There are two stages to complete an entry for our awards programme:

Best Bank in the Middle East

Stage 1

Banker of the Year

Candidates must first send in their nominations to awards@bankerme.net by the nomination deadline of 1st September 2019. Institutions can nominate themselves for as many categories as they wish, provided they are able to produce the supporting materials in Stage 2 of this process.

Lifetime Achievement Award

Fastest Growing Bank

Best Retail Bank

Best Islamic Bank

Best Corporate Bank

Best SME Bank

Capital Market Transaction of the Year

10.

Most Innovative Digital Banking Proposition

11.

Best Insurance Provider

Submissions received after the deadline date will not be considered. Whilst we understand the hectic yearly schedules, we aim to foster a competitive environment that is fair to all parties—both award participants as well as the judging panel.

12.

Best Takaful Provider

13.

Best Investment Bank – Conventional

14.

Best Investment Bank – Islamic

15.

Best Private Bank

Submissions for an award category must distinctly point out how and why your institution stands out above the rest. Depending on the award contended for, each submission should highlight any new product/initiatives/innovation/level of service/comprehensiveness/ efficiency—any means that could demonstrate overall competitiveness and outperformance amongst your peers across these markets, relevant to the award in question. The submissions may also include any infographics that you deem helpful to support your case.

16.

Best Wealth Management Firm

17.

Best Investment Management Firm

18.

Best Private Equity Firm

19.

Best Trade Finance Institution

20.

Best Brokerage Solutions Provider

21.

Best Law Firm – Banking & Finance

22.

Best Law Firm – Private Equity

RESULTS

23.

Best Research & Consultancy Firm

Following critical examination of all submissions, the judging panel will select their shortlisted institutions and this shortlist will be announced on or after 17th October 2019. The winners for each category will be announced at the Banker Middle East Industry Awards gala dinner on Tuesday 26th November 2019.

24.

Best Ratings Agency

25.

Best Islamic Ratings Agency

26.

Best CSR Programme

27.

Best Core Banking Service Provider

ADDITIONAL INFORMATION

28.

Best User-Experience Innovator

29.

Best Cybersecurity Provider

30.

Best Payment Solutions Provider

31.

Best Communications Infrastructure Provider

32.

Best Commercial Bank

For further clarification on the awards submission process kindly contact: awards@bankerme.net For more information on the Awards Gala Dinner and to book tables, please kindly contact: events@cpifinancial.net

NOMINATION DEADLINE: 1st September 2019

ENTRY SUBMISSION DEADLINE: 3rd October 2019

SHORTLIST ANNOUNCEMENT: 17th October 2019

INDUSTRY AWARDS GALA DINNER: 26th November 2019, The Ritz-Carlton DIFC, Dubai, United Arab Emirates

EVENTS

23 October 2019

26 August 2019 (Seqoya/SHUTTERSTOCK)

GLOBAL TAKAFUL FORUM

The event, held by AlHuda CIBE, will include two days of workshops and discussions surrounding operational aspects of Takaful, micro Takaful, and ReTakaful, as well as Takaful for regulators. The objective of the event is to provide adequate knowledge and communicate benefits of the Takaful industry to the market, helping to analyse the problems hindering rapid development of Takaful worldwide that would surely help to increase financial inclusion. VENUE: Istanbul, Turkey http://alhudacibe.com/UK2019/

THE 14TH ANNUAL ISLAMIC BUSINESS nk ing Islamic Ba Fastest Grow & FINANCE AWARDS r ne Win

For over a decade, CPI Financial has been gathering the industry’s leaders to honour the best of the best in the field. This fall, Islamic Business & Finance looks forward to welcoming the leaders from across the industry to Dubai in order to continue this time-honored tradition. As always, it will be the must-attend event of the season. VENUE: The Ritz-Carlton DIFC, Dubai, UAE www.islamicbusinessandfinance.net

26 November 2019

8–9 October 2019 (Hannamariah/SHUTTERSTOCK)

Best Bank in

the Middle Ea

WINNER

HALAL EXPO CANADA 2019

As a gateway to North American’s growing Halal market, Halal Expo Canada 2019 will gather the highest quality products of the Halal industry, creating a meeting point for Halal buyers and suppliers between east and west. From food and beverage to pharmaceuticals and cosmetics, from finance to ecommerce and logistics to tourism and more, a wide spectrum of the Halal industry will gather under one roof providing traders and buyers with a platform to conduct business, network, share market insights. VENUE: The International Center – Hall 4, Toronto, Canada http://halalexpocanada.com/index.html

Islamic Business & Finance | ISSUE 116

BANKER MIDDLE EAST INDUSTRY AWARDS 2019

For over 20 years, Banker Middle East has been serving the banking and finance community in the region. As the longest running GCCbased banking publication, and as part of our integral role in the region's banking sector, we benchmark, recognise, and actively encourage excellence within institutions. The 2019 Awards will give due recognition to outstanding institutions that have shaped and continue to shape the financial landscape. VENUE: The Ritz-Carlton DIFC, Dubai, UAE http://bankerme.net

www.islamicbusinessandfinance.net

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