"UK's Brown meets with City businessmen, aims to cut back on regulation", Government News Network (UK), October 18, 2006
In a meeting with City financial leaders, Chancellor of the Exchequer Gordon Brown and Economic Secretary Ed Balls laid out plans to cut back on regulation of the financial sector to encourage traditional financial sectors and to encourage "new and innovative areas such as hedge funds and Islamic finance". The U.K. has been working to try and make London one of the centers of Islamic finance in the West. Gordon Brown and Ed Balls are expected to become the next prime minister and chancellor of the exchequer, respectively, when Tony Blair steps down next year.
"The Al Rayan Bank gets down to business", AMEInfo, October 18, 2006
The recently founded Al Rayan Bank in Qatar is beginning its operations by becoming a funder in the Smart Industrial City, an eco-friendly industrial city focusing on electronics technology and manufacturing. Al Rayan is an Islamic bank and opened its first branch on October 8. The bank will continue to participate in infrastructure projects and large-scale project finance.
"Citibank facilitates 1st Islamic cross currency profit rate swap", The Edge Daily, October 18, 2006
Citibank and Dubai Financial LLC (DF) have entered into a Shari'ah-compliant cross currency hedge transaction to hedge DF's foreign exchange risk arising from its investment ina 40 percent stake in Bank Islam Malaysia Bhd. The foreign exchange profit rate swap has a 5-year tenure and is based upon Murabaha (cost-plus) transactions. "Citigroup said the deal involved Citibank and DF agreeing to undertake a series of commodity trades in different currencies. The effect of the hedge will be to insulate the DF from variations in FX rates." One of the significant parts of the deal is the harmonization of Shari'ah standards that it supports. Because DF operates in Dubai, but has a large equity stake in Bank Islam Malaysia, DF and Citibank structured the deal to meet the Shari'ah standards in Malaysia and the Middle East. In the past, Shari'ah boards in the Middle East have been more conservative in the types of products they will endorse.