Emirates Global, Al Baraka plan Pakistan merger

KARACHI: Bahrain-based Al Baraka Islamic Bank BSC, a wholly owned subsidiary of Al Baraka Banking Group (ABG), and Emirates Global Islamic Bank have planned a merger of the branches of Al Baraka Islamic Bank and Emirates Global Islamic Bank Pakistan under the name of Al Baraka Bank Pakistan, according to a statement.

“It will be the first Islamic banking merger in Pakistan and would bode well for the overall banking industry,” said Roger Dawood Bayat, Head of Investor Relations and Corporate Communications, Emirates Global Islamic Bank Limited.

North America's first Muslim MasterCard due to launch

OTTAWA: A Canadian Islamic financial institution is launching Canada’s first “halal-approved” credit card this month and will also offer it to US Muslims by year end, its president told AFP on Tuesday.

The iFreedom Plus MasterCard meets the requirements of Sharia law, which prohibits usury, by being prepaid and therefore interest-free, said Omar Kalair, president of Toronto-based UM Financial.

“Trade is allowed, but usury is not,” he explained.

A similar card is already available in Britain, but nowhere else in the West, he said.

Until now, devout Muslims in Canada have either had to do without credit cards or paid off the balance each month to avoid interest charges that go against their faith.

Three Islamic finance experts said in a statement the card “complies with Islamic Laws and Muslims can avail of this product.”

Of course, non-Muslims may want one too, Kalair said.

Benefits include no monthly fee, no transaction fees and discounts on flights with Etihad Airways, which flies from Toronto to Abu Dhabi.

According to a 2001 census, there are 580,000 Muslims living in Canada.

Kalair estimates the number is now one million.

Source Dawn News

SBP working on Sharia compliant short-term securities

KARACHI: The State Bank of Pakistan (SBP), Governor Syed Salim Raza, on Wednesday said that the central bank is working with the industry and the federal government to develop Shariah compliant short-term securities that will be issued on regular basis.

He was speaking on the occasion of a talk on ‘Current Islamic Banking Paradigm and the Way Forward’ by Dr. Umer Chapra, a renowned international scholar on Islamic Economics and Finance at SBP.

Moody’s sees huge global potential for Islamic banking industry

KARACHI: Islamic banking industry has an immense global potential to grow to $5 trillion from the current $950 billion as both individual depositors and companies have shown willingness to adopt Shariah compliance, an international rating agency said in its report on Tuesday.

“A combined use of securitisation and derivatives offers considerable scope for reducing the risk exposures of Islamic financial institutions (IFIs) and thus improving their overall creditworthiness,” said Moody’s Investors Service in its report.

Dr Hafeez Sheikh briefed on debt

ISLAMABAD: The finance ministry higher-ups have informed Finance Advisor Dr Abdul Hafeez Sheikh that the country’s external debt will increase by $2 billion to $60 billion and the domestic debt by Rs424 billion to Rs4.57 trillion by the end of 2010-11.
The officials briefed the advisor recently that there was a need to formulate and adopt a holistic debt management strategy.

Islamic export refinance users facilitated

Saturday, January 02, 2010
By our correspondent

KARACHI: The State Bank of Pakistan (SBP) on Friday said that export performance benefits have been extended to those who come under the Islamic Export Refinance Scheme (IERS).

Banks to face Rs8 billion Sukuk default

KARACHI: Banks in Pakistan were stunned at the information that a major cement company has expressed inability to payback Rs8 billion Sukuk bonds and has asked the creditors to restructure the payment schedule.

Banking sources said in a meeting held on Friday last with the bankers and income fund managers, Maple Leaf which issued the Sukuk, asked the bankers to restructure the financing.

The re-payment of Sukuk is due from June 2010 in eight semi-annual installments, said the sources.