Moody’s Investors Service has today upgraded to Baa3 from Ba1 the long-term foreign and domestic currency ratings of DP World Limited, the Dubai-based real estate firm that defaulted on its sukuk (Islamic bond) payments a few years ago… http://www.zawya.com/story.cfm/sidZAWYA20110411064120
Moody’s downgrades Kuwaiti Sukuk Issuer, NIG
Moody’s Investors Service has downgraded to B2 from B1 the Corporate Family Rating (CFR) and Probability of Default Rating (PDR) of National Industries Group S.A.K. (“NIG”), as well as the instrument rating for the $475m sukuk issued by NIG Sukuk Ltd. The outlook on the ratings remains negative. http://www.ameinfo.com/258031.html
Sukuk defaulter Nakheel to issue new sukuk
Dubai property developer Nakheel, whose mammoth default on Sukuk payments two years ago stung creditors around the globe, illustrating an overall high default rate in the sukuk category, is now coming back for more. Of course, Nakheel claims that all is well now. The sukuk issue is expected in this quarter. Details as they become […]
Demand for Islamic bonds from the Middle East will return to “pre-crisis” levels by the end of the third quarter as companies restructure debt and higher yields lure investors, according to Citigroup Inc. Defaults by companies in the Gulf have increased concern about risks associated with Islamic bonds. http://www.businessweek.com/news/2010-10-25/citigroup-sees-sukuk-demand-recovery-in-a-year-islamic-finance.html
Nakheel PJSC, the developer of palm- shaped islands off Dubai’s coast, is in preliminary talks with Nasdaq Dubai to list Islamic bonds. Nakheel was the debtor involved in the multi-billion dollar Dubai World Sukuk debacle in late 2009 in which creditors were asked to “stand still” and extend maturities on Islamic bonds (Sukuk). The Dubai […]
There is something about Sukuk (Islamic Bonds) which must make them more susceptible to default than conventional financing instruments. Since the outset of 2009, there have been no fewer than 34 defaults by Sukuk issuers. Keep in mind that this rash of defaults comes from an industry that touts itself as a form of “ethical […]
Nakheel PJSC’s proposed sukuk to settle trade creditor claims is estimated to have a fair value in the low 60 cents to the dollar, JPMorgan Chase & Co. said. The property company, controlled by state-owned Dubai World, will be able to make almost all coupon payments on the five-year Islamic bonds although “we are less […]
Concerns are surfacing that DIFC Investments of Dubai will struggle to make payments on its $3 billion debt financed by Sukuk (Islamic bonds)… “The source of that sukuk repayment is going to be asset sales. So, as much as there is uncertainty in their asset- sale plan, obviously there will be concern on their sukuk […]
The recent notification by Kuwait’s International Investment Group (IIG) KSCC that it was not in a position to make the periodic payments due on July 12, 2010 on its $200 million exchangeable Sukuk (Islamic bond) issued in 2007 and which matures in 2010, once again turns the spotlight on the troubled market. This is the […]
Here we have a marketing piece by Reuters (whose parent company is thoroughly involved in Shariah Finance) masquerading as a news story. In what other industry or financial sector could a rash of defaults–combined with high fees and conflicts of interest–prompt a wave of faux optimism as expressed in this Reuters fluff piece? Recent sukuk […]
The lure of Islamic bonds appears to be wearing off for borrowers in the Persian Gulf region, with high-profile defaults and rising costs souring their appeal. “Dealing with Sukuk defaults, standardizing Shariah interpretation, and increasing Sukuk liquidity, we believe, are at the root of issues that could curb future growth,” said Mohamed Damak, analyst for […]
International Investment Group (IIG) of Kuwait said it is unable to pay $152.5 million to sukukholders who demanded immediate repayment after the Kuwaiti finance company defaulted on its $200 million Islamic bond. In April, IIG became the second Kuwait-based firm in a year to miss a sukuk payment. Investment Dar Co., owner of half of […]
The Sukuk (Islamic bond) market has yet to recover from the rash of defaults which hit Shariah Compliant Finance starting with the 2008 financial crisis… http://www.zawya.com/story.cfm/sidZAWYA20100718112801/IFIS%20releases%20H1’2010%20Global%20Sukuk%20Market%20Report%20
Beleaguered UAE mortgage lender, Tamweel may be acquired by Dubai Islamic Bank, the UAE’s largest Shariah-compliant lender. http://www.kippreport.com/2010/06/dubai-islamic-bank-may-acquire-tamweel/?
Islamic Bond market forecast to ride “rough patch”
FT’s Robin Wigglesworth continues to exhibit a lack of curiosity when it comes to Shariah finance… http://www.zawya.com/Story.cfm/sid20100414_8473_283
Though The Economist continues to actively ignore many of the fundamental concerns surrounding Shariah-Compliant Finance, the article linked below about the Sukuk market is actually fairly well done, especially when one considers that The Economist has basically been nothing but a shameless cheerleader for Shariah Finance heretofore… The article points out many of the problems […]
Linked below is an article written in a journal of the Wharton school of business at the University of Pennsylvania. It appears to address an issue which is indeed a huge problem in Shariah-Compliant Finance: Lack of Transparency. But appearances can be deceiving. What the Wharton article, which has no author’s name associated with it, […]
Another UAE Sukuk Issuer Looks to “Restructure”
Over the past two years, there have been numerous defaults on Islamic bonds (better known as Sukuk). In fact, default rates on Sukuk are apparently higher than those of conventional bonds. This is likely due to the higher fees associated with Sukuk which are arrived at from a series of convoluted machinations designed to keep […]
Dow Jones has been shilling for Shariah-Compliant Finance for some time now. After all, the Dow Jones Islamic Index employed the Jihadist Shariah scholar Taqi Usmani as chair of its Shariah advisory board for a long time before rival Investors Business Daily exposed them. Now the flagship Wall Street Journal has published a piece on […]
Sales of bonds that comply with Islamic laws will remain “weaker” this year as investors shun riskier, higher-yielding assets on concern governments will struggle to repay debt. Sales of the bonds known as sukuk have totalled $564 million so far this year, compared with $2.5 billion for the first quarter last year, according to data […]
Standard & Poors Predicts Steady Growth in Islamic Bond Market
In a report published last week, Standard & Poors predicted steady growth in Islamic bond issuance in 2010, with about $20 billion of Sukuk publicly announced in the past likely to come to market if conditions permit. “In addition, we understand from unofficial market sources that about $10 billion more could potentially enter the pipeline. […]
Moody’s Downgrades ANOTHER Sukuk Issuer
Last week reported that Moody’s Investor Services had downgraded a Kuwaiti firm that had issued Sukuk (Islamic Bonds). https://shariahfinancewatch.org/2010/01/27/another-sukuk-issuer-in-deep-trouble/ This weekend we were greeted with the news that Moody’s had downgraded yet another Sukuk issuer, this time a real estate development firm out of Abu Dhabi. If this is a harbinger of things to come, […]
Moody’s Investors Service has downgraded the Corporate Family (CFR) and Probability of Default Ratings (PDR) of Kuwait-based National Industries Group Holding S.A.K. (NIG) and the debt ratings on the USD 475 million sukuk issued by NIG Sukuk Limited to B1 from Ba3. These sukuk are basically “junk Islamic bonds.” So much for the idea that […]
As we reported not long ago, one of the oldest banks in Kuwait, BKME, will soon complete the conversion process from legitimate, civilized finance to Shariah Compliance. Now we learn that in justifying this move, they are making claims about the durability of Shariah-Compliant financial institutions in the face of economic crisis: “Islamic banking is […]
The total debt of cash-strapped Dubai could be as much as 170 billion dollars, much higher than earlier reported, according to a report by EFG-Hermes regional investment bank. This could result in a default from real estate property firm Nakheel on $4.1 billion in sukuk (Islamic bonds). http://uk.biz.yahoo.com/19012010/323/photo/property-giant-nakheel-default-4-1-billion-dollars-islamic-bonds.html? http://www.google.com/hostednews/afp/article/ALeqM5iD24lBQsNXlQXMjk51XSkF3WTdtA
Qatar Islamic Bank, the Gulf state’s second largest lender by market value, saw fourth-quarter net profit drop 23 percent on Monday, falling shy of analysts expectations. Not long ago, Qatar Islamic Bank revealed that it had an exposure in the Dubai default debacle. http://www.reuters.com/article/idUSLDE60H14K20100118?rpc=401&feedType=RSS&feedName=hotStocksNews&rpc=401 This is but the latest in a series of disappointing reports […]
Moody’s Downgrades Qatar Real Estate Sukuk Issuer
Moody’s Investors Service has downgraded Qatar Real Estate Investment Company, which has issued $300 million in Sukuk (Islamic Bonds) from A2 to Baa1. Moody’s also issued an advisory for possible additional downgrading in the future. The move was prompted by the announcement that Qatar Real Estate Investment Company would become a wholly owned subsidiary Barwa […]
Dubai Debts Prompt Review of Shariah Finance
SFW has long maintained–and pointed out–that Shariah-Compliant Finance is in now way immune to market and economic forces and thus cannot provide a safe haven in the event of economic or financial crisis. We point this out because so many financial jihadists routinely commit fraud by claiming that Shariah Finance is protected by the principles […]
In the civilized world, this would be referred to as a “default.” But in the world of Shariah, it’s simply called a “standstill.” Creditors have little choice but to go along with the swindle that Dubai has perpetrated on them. Sooner or later, maybe Western financiers will discover that all of the added but often […]
Money Fleeing Malaysia
Here on Shariah Finance Watch we have documented that Malaysia is ground zero in the Pacific Rim for Shariah Finance: https://shariahfinancewatch.org/category/malaysia/ Almost all of the financial news out of the Malaysian capital of Kuala Lumpur over the past year has been centered around “Islamic” finance and banking. The country’s prime minister and other cabinet members […]
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