Friday, April 27, 2007

U.K. may launch sukuk as early as this year

U.K. may launch sukuk as early as this year

The Financial Times reported this morning that the U.K. Shari'ah-compliant government bonds could be issued as early as this year. The article goes on to suggest that the appeal of sukuk for non-Muslims could be that they are an alternative source of funds to tap. Along these lines, "[John] Sandwick [manager of Sanad] predicts that big corporations such as Ford, the US carmaker, will one day look to sukuk for financing. 'If you're the treasurer of Ford Motor, you want diversified funding sources. You want to absorb the liquidity to finance your liabilities. You don't want to rely on the New York bond market,' he says."

Other news

The UAE Central Bank announced it will not issue more banking licenses at this time. This hurts the prospects for Amlak Finance which was rumored to be continuing to seek a banking license despite being denied several months ago.

The head of the Dubai International Financial Centre (DIFC) Omar bin Suleiman said that the growth of Islamic finance in Asia will complement the developments in the Middle East. The growth of the industry, both within the GCC region and without increases demand for Islamic finance and the competition forces cities & banks to become more efficient and value creating.

The Malaysian central bank, Bank Negara Malaysia may allow foreign banks to set up independent Islamic banks. Currently, foreign banks like HSBC operate their Islamic banking services from a window within the conventional bank.

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