The recovery in oil prices will have a positive effect on the general business environment across the Gulf region in general and the sukuk market in particular as it will help ease funding woes of investors, senior bankers say.
Talking to Khaleej Times on the sidelines of the Bonds, Loans and Sukuk Middle East conference, senior bankers of Noor Bank said higher oil revenue injects more cash into the system, which increases the funding available to support regional growth.
Saudi Aramco IPO may more than Quadruple Islamic Finance Industry Size.
Current estimates of the size of the global Islamic finance industry range from $1.66 trillion to $2.1 trillion. Recent announcements from Saudi Aramco may be about to give these numbers a supersized boost with a potential valuation and IPO of up to $10 trillion.
The upside for sovereign sukuk issuance in GCC countries is limited in 2015, according to Standard & Poor's (S&P) Ratings Services.
Although S&P expects lower oil prices to lead to fiscal deficits in some countries in the GCC, most governments' net asset positions will likely remain strong enough to enable their financing.
As Dubai aspires to become the global hub for Islamic economy, Islamic banking and Islamic capital markets are expected to grow simultaneously, said Adnan Chilwan, CEO of Dubai Islamic Bank. Clearly Islamic capital markets are relatively new phenomena. Earlier it was much simpler that if someone needed finance they would go to a bank and the bank would leverage its balance sheet and give a loan. Then it started becoming a little more sophisticated by many banks joining in together to do a syndicated deals. Then a stage came where banks started to participate in cross border deals.
The recent announcement that Dubai aims to become a global centre for Islamic finance and economy has sparked a surge of interest in the emirate in all aspects of Sharia-compliant business.
But in one business in particular, the Dubai Multi Commodities Centre, the news was greeted as confirmation of a trend that has been under way for at least seven years.
A Shariah-compliant forestry fund has been launched by Sustainable Capital which is based in Luxembourg in order to lure Islamic investors along with those interested in green investment.
Sydney: A Shariah-compliant forestry fund has been launched by Sustainable Capital which is based in Luxembourg in order to lure Islamic investors along with those interested in green investment.
Bursa Malaysia, the state-controlled financial exchange, is in talks with Middle Eastern banks to boost activity on its 18-month-old Islamic commodities market that increased five-fold last year.
Daily trading averaged RM351 million (S$147 million) in 2010, up from RM69.6 million in 2009 and has reached as high as RM4 billion this year, Raja Teh Maimunah, global head of Islamic markets at Kuala Lumpur-based Bursa, said in an interview on Monday.
The Iranian deputy oil minister said that the ministry plans to issue Islamic sukuk bonds made available for the first time for the littoral Persian Gulf states and Middle East countries.
The Mehr News Agency quoted Mohsen Khojasteh-Mehr as saying that the oil ministry plans to diversify its financial resources and one means of doing this during the Fifth Socio-Economic Development Plan (2010-2015) is to publish bonds.