Opalesque Islamic Finance Briefing
Islamic Finance in the News
Islamic Finance in the News (version 2)
Islamic Finance in Blogs
Islamic Finance in Blogs (version 2)
Islamic Finance on the Web
Rob Bauer, Roger Otten, Kees C. G. Koedijk
In addition, our Linkedin forum now has three new subgroups to focus on certain topics/discussions (feedback is very much appreciated):
Islamic Finance - Accounting & Auditing
Islamic Finance - Careers & Education
Islamic Finance - Takaful & Pensions
Shamshad Akhtar, Zeti Akhtar Aziz, Robert W. Hefner, Nik Norzrul Thani, Angelo Venardos, Frank E. Vogel and Ibrahim Warde
The National Bureau of Asian Research
"What is Islamic finance (IF)? Islamic finance has recorded dramatic growth over the last decade or so, with a presence in more than 75 Muslim and non-Muslim countries and total financial assets now estimated to exceed $1 trillion. With the integration of IF and Islamic banking into the global economy, IF’s appeal as a market for and source of global capital is increasing. The industry’s rapid growth is marked by increases in Islamic financial products and services, the development of the industry’s regulatory frameworks, and enhanced international linkages.
To gain a better understanding of the phenomenal rise of IF in general, of Southeast Asia’s particular role as an epicenter for IF innovation and development, and of the opportunities and challenges facing IF as an economically viable global financial industry, Asia Policy presents insights from a panel of senior finance officials, industry practitioners, and scholars."
The Survey is supported by AAOIFI (Accounting and Auditing Organisation for Islamic Financial Institution) and is being organized by Dinar Standard--a market intelligence consultancy focussed on the OIC (Organization of the Islamic Conference) member countries and Dar Al Istithmar--a leading Islamic Finance advisory firm.
The output will be an Islamic Finance CSR Trends Report to be released publicly August 31st, 2009. Each institution submitting the survey will also receive a confidential benchmark report that will highlight their performance compared to their peers in aggregate. Major CSR accomplishments of the Industry will also be recognized by the introduction of Maqasid Al-Sharia CSR Awards.
Please find the PDF version of the survey attached which can also be downloaded here. You may fill in this form electronically or print and send it back to us as a scanned copy by email. Also, you can fill in this survey online if you so wish.
For and on behalf of Sayd Farook
Stock Market Volatility Transmission in Malaysia: Islamic Versus Conventional Stock Market
Rosylin Mohd. Yusof and M. Shabri Abd. Majid
Islamic Economics Research Centre
King Abdul Aziz University, Jeddah, Saudi Arabia
Abstract: "This study attempts to explore the extent to which the conditional volatilities of both conventional and Islamic stock markets in Malaysia are related to the conditional volatility of monetary policy variables."
"The study finds that interest rate volatility affects the conventional stock market volatility but not the Islamic stock market volatility. This highlights the tenet of Islamic principles that the interest rate is not a significant variable in explaining stock market volatility."
OIFI is produced by leading alternatives publisher Opalesque Ltd. and Amsar Partners LLP (select "Opalesque Islamic Finance Intelligence" for our FREE monthly premium subscription, and "Islamic Finance Briefing" for FREE daily news updates).
It speaks about AAOIFI standards, the question of legitimacy of purchase undertakings, and most importantly, whether the current debate and stalemate will jolt the market into an demand for actual compliance.
Definitely worth a read.
Thanks to Juweria Amin of IBFNet.
The Islamic Financial Services Board (IFSB)
28-29 September 2009, Bank Negara Malaysia, Kuala Lumpur
The Seminar programme is designed to focus on the following areas:
- Duties and responsibilities of Sharī`ah Boards from a legal and regulatory perspective;
- IFSI insolvency and asset recovery framework - Gaps and challenges;
- Interlink/interface between civil law systems and Sharī`ah rules and principles and effective dispute resolution mechanism; and
- Challenges in managing legal risks in Islamic financial services
To download the registration form directly click here.
The National Bureau of Asian Research
"Islamic finance must be recognized as a parallel system that will augment, and be augmented by, a deeper knowledge and experience of the conventional financial system. As such, the industry’s long-term growth and sustainability depend on: (1) how Islamic finance interfaces with and benefits from complementing and supplementing the conventional system, and (2) how Islamic finance adapts and conforms to international regulations and supervision while remaining aligned with the technicalities and nuances of Islamic financial instruments and their associated risks. Properly exploiting the unique features of Islamic finance with appropriate adaptability, and without compromising principles of sharia (Islamic law), will be critical to the growth and promising future of the Islamic finance industry.
Touching on some of these debates, the essay begins by addressing trends in Islamic finance, then turns to lay the case for the sustainability of Islamic finance, and concludes with a discussion of some key prospects and challenges facing the industry."
Enhancing Interlinkages and Opportunities: The Role of Islamic Finance
Zeti Akhtar Aziz
Bank Negara Malaysia
"Five years ago discussions regarding Islamic finance focused on the challenges of developing an efficient and robust Islamic financial system. Today the Islamic financial system has evolved significantly to become a dynamic and competitive form of financial intermediation in the global financial system. This essay addresses the transformation and innovation that have taken place in these five years in both the national and international Islamic financial systems and concludes with an examination of necessary elements for sustaining the systems’ growth. Most significant have been the development of the Islamic financial markets, the growth in the range of financial products and services, the increasing significance of the international dimension of Islamic finance, the development of an international Islamic financial architecture, and the enhanced international interlinkages that have been brought about by these developments."
Trends in Islamic-Finance Regulation
US Department of Commerce
International Trade Administration
Many other sources are available only in hardcopy (e.g., Sh Yusuf Talal DeLorenzo's books from IIBI, Dr Wahbah al Zuhayli's two volumes on Islamic Finance, the AAOIFI Shariah Standards), but there are still some very good sources of fataawa available online and Insh'Allah this offers readers some benefit.
Fataawa Banks for Fiqh Al Mu'amalat
- Al Baraka Group Fatwa Bank (Product-Specific Fatawa)
- Assembly of Muslim Jurists of America
- Bank Negara Malaysia
- Fatwa Management System: World Fatwa Mgt and Rsrch Inst, Universiti Sains Islam Malaysia
- Harvard Islamic Finance Information Program (HIFIP) (Free Login Needed)
- International Shari'ah Research Academy for Islamic Finance (ISRA)
- IIBF Shariah Advisory Unit Fatwas
- IslamQA Principles of Fiqh-Transactions
- IslamWeb Fatwa Center (Transactions and Inheritance)
- Monzer Kahf Fatawa Listing
- Malaysia International Islamic Financial Centre (MIFC) (see The Shariah Resolution Book, for product-specific fataawa/resolutions)
- Securities Commission Shariah Advisory Council Resolutions
Lists of Links to Fataawa Banks (Many out of date)
- Fatwa Resources, Konsultasi Muamalat
- Fatwa Resources, Muslim Investor.com
- Rulings on Islamic Banking, IslamicBanking.com
- Mejelle (Ottoman Codification of Hanafi Fiqh)
- Risala (Maliki Fiqh)
Please send in comments and updates. The only way we can keep this "fresh" is if you help alert us of bad links and new developments! JAK!
The notion of a standalone Islamic stock exchange (as opposed to having conventional and Shariah compliant products side by side) is debatable due to issues relating to implementation and practicality. However, the paper's focus is on how to restrain/control gharar.
It proposes two "Shariah restraints":  "calling for the provision of relevant information on one hand, and  the analytical ability to estimate true exchange values on the other. These two main restraints are intended to attack the problem of gharar, or to put it differently, they are intended to account for closer convergence of the actual share’s price with its true expected economic value."
The paper inlcudes a curious quote from John Maynard Keynes:
Keynes, it seems, would have made for a great scholar!
“The spectacle of modern investment markets has sometimes moved me towards the conclusion that to make the purchase of an investment permanent and indissoluble, like marriage, except by reason of death or other grave cause, might be a useful remedy for our contemporary evils" (1970)
Structured products have become popular as a wholesale fund product and a popular deposit instrument for Islamic Banks as well as an investment linked product for takaful.
Mark this event in your diary now. For further details please email email@example.com
- Topics will address the landscape and current views on Shariah-compliant structured products and hedging tools, an examination of the building blocks in constructing these products, the approach and philosophies in regulating the Islamic capital market in Malaysia and case studies.
- A panel of speakers will deliberate on the resilience of Islamic finance, factors which are curtailing its further expansion and the development of Islamic finance products in achieving Shariah harmonisation.
- A face-to-face deliberation with renowned practitioners, Shariah scholars as well as regulators.
Note: for those who cannot attend, we will spend some time surveying the landscape of structured product from Himalayas to Perfect Asset Allocation/Rainbow Options to TARNs to LIFTS to Range Accruals to Expert Trader Options, etc. Some are possible in Shariah-compliant format, some less easily so, and some with obvious benefit to investors, and some only with obvious benefit to issuers/investment banks (Caveat Emptor, i.e., buyer beware!). Expect some serious debate.