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World Islamic Fintech Awards

IFN Annual Guide 2020

Darkest before dawn

As we were wrapping up 2019, the editorial tone was rather optimistic. After a year of what many would have described as challenging, it was encouraging to see challenges in 2018 being turned into opportunities in the following year, translating into positive developments for the global Islamic finance landscape as the industry experienced a stronger Sukuk market, a banking sector which was becoming more streamlined, the introduction of a number of supporting regulations and the increasing proactive alignment of the Shariah finance community with the principles of sustainability, and of course, the tantalizing promise of greater convergence between the Islamic finance sector and the Halal industry.

Such progress was rooted mostly in stronger energy prices and some semblance of stability or at least, less uncertainty, as the US and China finally settled on a ‘phase one’ agreement which would ease some trade war tensions. Demand for Sukuk rose by 6% to US$130 billion according to Moody’s Investors Service after a 10% volume contraction in 2018, as issuers and investors alike breathed a sigh of relief at the conclusion of the Dana Gas Sukuk scandal which shook market confidence the year before. The scandal, which was one of the most significant internal challenges the industry faced in recent years, drove home the urgent point for Shariah standardization and stronger governance models for Islamic banking and finance. As Islamic financial organizations revised their procedures, markets such as Morocco and the Philippines also took the steps to introduce new Islamic finance frameworks in 2019 while industry stalwarts Malaysia and the UAE confirmed intentions of enhancing Shariah oversight and Indonesia released its five-year Shariah economy masterplan.

2019 also witnessed high-profile Islamic banking consolidations which resulted in more robust operations in an overbanked GCC market. Abu Dhabi Commercial Bank, Union National Bank and Al Hilal merged; Dubai Islamic Bank acquired Noor Bank; Abu Dhabi Financial Group concluded its amalgamation with SHUAA Capital; and Barwa Bank combined with the International Bank of Qatar; while Kuwait Finance House agreed to buy Ahli United Bank.
The US$2 billion green sovereign Sukuk by the Indonesian government and the world’s first dollar benchmark green Sukuk by a corporate — the UAE’s Majid Al Futaim — were vindication of the Islamic finance industry’s sustainability and ethical DNA. And with Indonesia, Malaysia and the UAE aggressively pushing to integrate Islamic finance into their larger Halal economy to create end-to-end Shariah compliance for the Halal supply chain, Islamic financial institutions have been jumping to meet the Halal finance gap.

All these laid the foundation for a rather upbeat outlook for 2020. Then the coronavirus hit. And the effects of COVID-19 began to cripple economies. Wildly unprepared for a global pandemic which has been spreading at unprecedented levels, governments across continents began to close their borders as many entered into lockdown mode as they attempt to flatten the infection curve and not overburden their healthcare system, while struggling to strike a balance between keeping its economy alive, collective safety and individual freedom.

With millions infected and deaths in the hundreds of thousands in less than six months, the paralyzing financial and economic impacts of the novel coronavirus are likely to last many months after the situation has stabilized. The equity markets have been greatly affected, and banks are already making provisions preparing for steep losses as businesses come to a grinding halt. The upbeat outlook was overturned.

It will be a challenging 2020.

But the Islamic finance industry is no stranger to challenges. Ups and downs are characteristics of the financial markets and any economy. The Islamic finance community is responding swiftly, adapting and adopting new strategies — anchored in technology — to overcome the barriers imposed by the pandemic. New solutions are in the pipeline — after all, it is said that necessity is the mother of invention.
The industry is not oblivious to the herculean task of recovery and the challenges that lie ahead. Remaining pragmatic, many are looking for a silver lining during this dark storm. The industry will be tested yet again. But as you read this year’s annual guide, you will notice a thread of cautious realistic optimism as industry participants continue to keep their heads up high — as they have done through countless moments of economic troughs.
On that note, I sincerely hope that the IFN Annual Guide 2020 would be read as a sign of our industry’s resilience as we go through such troubled times together.

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Content in IFN Annual Guide 2020

2020: Doing finance differently

IFN Annual Guide 2020 | Features

How family offices can employ the advantages of Islamic finance in the current uncertain environment

IFN Annual Guide 2020 | Features

Sukuk market continues to grow

IFN Annual Guide 2020 | Features

Technology in Islamic finance

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US online dispute resolution mechanism for global Islamic finance industry

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Equipping the workforce toward the three Ps

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The UK: A continued evolution

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UAE: Adopting the green finance

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Islamic finance continues to be strategic area for Turkish financial system

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Islamic finance landscape in Tunisia: More fear than pain

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Taiwan’s inaugural Formosa Sukuk reaches new level of Islamic finance development

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Reviewing the Islamic market development through the lens of indices

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Syrians trust in Islamic banks

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Institutional asset management: ESG the ticket to exponential growth

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Legal and regulatory aspects of Islamic finance and banking

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Sri Lanka: A pearl of the Indian Ocean

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Islamic leasing: Opportunities and challenges

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Shining a light on Shariah investing

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Liquidity management in Islamic banks

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Diagnosis of the Islamic financial industry in Senegal

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M&A trend continues among Islamic banks

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Social and economic reforms at lightning speed

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Islamic microfinance: Small but with mighty potential for the next decade

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Halal activities growing in Russia

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Evaluation of Islamic pension

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A handover year for Qatar

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The Philippines: An exponential growth of Islamic banking and finance

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Islamic finance in Pakistan: Marching toward sensible and stable growth

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Successes, challenges and expectations in Omani Islamic finance market

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Sustainability and digitization taking the wheel in Islamic economy

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The Islamic project and infrastructure finance market

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Islamic real estate industry continues to have much to contribute to investors

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Islamic banking and finance regulations – critical element for industry development

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Islamic retail asset management: A time for resilience

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Islamic retail banking is the best example of ‘inclusivity in the financial landscape’

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Complex risk parameters mandatory for 2020

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Secondary markets for Islamic finance revisited

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Shariah and corporate governance: Promising progress

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Islamic financing for SMEs: Then, now and in the future …

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Sovereign Sukuk issuance to grow modestly in 2020 on greater financing needs

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Islamic finance industry needs to hasten pace and leverage impact as competitive advantage

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Narrowing the gaps: Moving toward Islamic finance standards and standardization

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Offshore centers continue to be domiciles of choice for establishing vehicles for Sukuk issuance

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Nigeria — a dynamic Islamic finance space

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New Zealand: A year of reflection and renewal

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Islamic finance ecosystem still under implementation

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Islamic finance in Malta: A need to shift from awareness to advocacy

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Prosperous year for Islamic capital market in the Maldives

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Luxembourg to witness solid growth in Islamic finance in 2020

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Lebanon’s crisis and the role of Islamic banks

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Kuwait: Unexploited potential

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Islamic finance in Kenya: More work needs to be done

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Kazakhstan: First steps to becoming a regional hub for Islamic finance

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The rise of Japanese investors in broadening the Sukuk investor base

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The Ivory Coast strengthens Islamic finance regulatory framework

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Opportunity knocks in Ireland

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Hong Kong needs a Sukuk fintech key

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Germany’s Islamic finance market awakens

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France: White label platform the new name of the game

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Egypt — a potential gateway for Sukuk issuances in Africa

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Structured Islamic finance as a viable economic solution for today and future

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The pursuit of Islamic finance in Djibouti

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Islamic syndications pre and post COVID-19 era

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China upholds ‘One Belt, One Road’ initiatives while developing Islamic finance

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Takaful in Asia on a continued growth path despite difficult circumstances

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More Shariah compliant funds expected in Canada

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Brunei’s Islamic finance industry builds future capacity

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The crossing of the Takaful paths in Europe

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New opportunities for Islamic business in Brazil

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Bosnia and Herzegovina: The future is certainly client-centric

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Australia: More financial services regulation and slower economic growth

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What’s next for Islamic finance in Algeria

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Development of Islamic trade finance products key to unlocking regional potential

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Afghanistan: What to expect in 2020?

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The revolution of trading and brokerage with Islamic finance

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Islamic treasury — issues in interbank commodity Murabahah as a liquidity management tool

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Islamic wealth management: A review of the industry

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Digital and sustainable transformation of an industry

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Islamic banking supports advancement of Bangladesh’s economy

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A glance at Islamic financial institutions in India

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Good prospects for development of Indonesia’s retail-based Islamic investment products

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Iranian capital market looking for more developments

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Government-backed infrastructure projects to dominate Sukuk issuance in 2020

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Singapore: Harmonizing Islamic finance with Halal businesses

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The development of Islamic fintech will lead to better financial inclusion

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Equity capital markets amid coronavirus pandemic

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Market outlook of Islamic accounting

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Islamic finance industry’s growing influence in agriculture

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Sukuk as a vehicle for airlines’ recovery plan

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Cautious optimism for Islamic cross-border financing

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Islamic fintech and crowdfunding

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New technologies the way forward for financial crime

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Islamic debt capital market: Anticipation builds

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Benefits of hedging using bitcoin futures

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Islamic finance education mapping analysis

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Overview and outlook of the global Halal industry

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