Showing posts with label goldman sachs. Show all posts
Showing posts with label goldman sachs. Show all posts
Monday, April 30, 2012
WORLD - REGULATONS - AAOIFI in wide review of Islamic finance standards
www.reuters.com - (Reuters) - Islamic finance may face its biggest shake-up in years as a top standard-setting body seeks to reform the way the industry does business, including the role of highly paid scholars in enforcing religious principles.
Khaled Al Fakih, the new secretary-general of the Bahrain-based Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI), outlined plans for a sweeping review of its guidelines in an interview with Reuters.
Some of AAOIFI's reforms may prove controversial by challenging entrenched interests in the fast-growing business. Islamic financial assets hit $1.3 trillion globally last year, a 150 percent rise in the past five years as the industry expanded beyond core markets in the Middle East and Malaysia, financial lobby group TheCityUK estimates. (source)
Friday, February 24, 2012
WORLD - FUNDAMENTAL DEBATE - Goldman Sachs : genuine or Ribawi Sukuk in the making?
A) The deal on paper : a plain vanilla Murabaha Facility
The above inserted graphic reflects the most used practice of the Murabaha-to-the-Purchase-Order. The reader will be familiar with this.
The Base Prospectus stipulates repeatedly: " whereby the Trustee will, at the request of GSI, use the proceeds of the issuance of the Series to purchase certain commodities from a third party Seller on immediate delivery and immediate payment terms and will immediately sell such commodities to the GSI on immediate delivery terms but with payment on a deferred basis." And further Mr. Asim Khan - MD and head of structuring for Dar Al Istithmar - stated that the paperwork "clearly shows that Trustee, as seller, sells the commodity to GSI, as purchaser. Thats it...." and further that: "Once the commodity is sold to GSI, its then at GSIs discretion to do what it wants to with the commodity". This looks like a plain, even boring Murabaha Facility. Yawn
Mr. Khan further states that: "the legal documents ... have been reviewed and approved by leading scholars in the Islamic finance industry ..." and suggests that Mr. Mohammed Khnifer did not fully read or grasp the contents of the available documentation. It is however clear that Mr. Khnifer did read the documentation sufficiently and that he did grasp the implications thereof very well. Actually, Mr. Khnifer voices a concern of a not unimportant part of the industry.
Simple review of legal documentation is hardly convincing. One must go have a look at the intentions of the parties concerned and their factual behavior. It was this look that originated the 'Tawarruq-debate' in the first place.
(Source) or (rest of story hereunder) (softcopy available on demand)
The above inserted graphic reflects the most used practice of the Murabaha-to-the-Purchase-Order. The reader will be familiar with this.
The Base Prospectus stipulates repeatedly: " whereby the Trustee will, at the request of GSI, use the proceeds of the issuance of the Series to purchase certain commodities from a third party Seller on immediate delivery and immediate payment terms and will immediately sell such commodities to the GSI on immediate delivery terms but with payment on a deferred basis." And further Mr. Asim Khan - MD and head of structuring for Dar Al Istithmar - stated that the paperwork "clearly shows that Trustee, as seller, sells the commodity to GSI, as purchaser. Thats it...." and further that: "Once the commodity is sold to GSI, its then at GSIs discretion to do what it wants to with the commodity". This looks like a plain, even boring Murabaha Facility. Yawn
Mr. Khan further states that: "the legal documents ... have been reviewed and approved by leading scholars in the Islamic finance industry ..." and suggests that Mr. Mohammed Khnifer did not fully read or grasp the contents of the available documentation. It is however clear that Mr. Khnifer did read the documentation sufficiently and that he did grasp the implications thereof very well. Actually, Mr. Khnifer voices a concern of a not unimportant part of the industry.
Simple review of legal documentation is hardly convincing. One must go have a look at the intentions of the parties concerned and their factual behavior. It was this look that originated the 'Tawarruq-debate' in the first place.
(Source) or (rest of story hereunder) (softcopy available on demand)
WORLD - FUNDAMENTAL DEBATE - Debate rages over Western role in Islamic finance
www.lse.co.uk - LONDON, Feb 23 (Reuters) - A controversial plan by Goldman Sachs to issue an Islamic bond has ignited a wider debate on whether conventional banks in the West should be allowed to engage in Islamic finance.
At a major conference of Islamic scholars and bankers in London this week, much of the public and private discussion was devoted to whether growing Western interest in Islamic finance could damage the industry by compromising its religious principles. (source) (see also)
At a major conference of Islamic scholars and bankers in London this week, much of the public and private discussion was devoted to whether growing Western interest in Islamic finance could damage the industry by compromising its religious principles. (source) (see also)
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