Morocco paves way for Islamic finance industry

The central bank said it was allowing five common types of transaction: Murabaha, Musharaka, Ijara, Mudaraba and Salam. (Reuters)
Updated 06 March 2017
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Morocco paves way for Islamic finance industry

RABAT: Morocco’s central bank has approved the use of five types of Islamic banking transaction, giving a final regulatory nod for the country to launch an Islamic finance industry.
Islamic banks and insurers are setting up in Morocco after new legislation allowed them into the market, and the central bank has set up a central Shariah board, a body of Islamic scholars, to oversee the sector.
The North African country long rejected Islamic banking because of concern about Islamist movements, but its financial markets lack liquidity and foreign investors, and Islamic finance could attract both of those.
In circulars published in the official bulletin over the weekend, Morocco’s central bank said any Islamic transaction would be subject to preliminary approval by the Shariah board, called the Shariah Committee for Participative Finance (SCPC).
The central bank said it was allowing five common types of transaction: Murabaha, Musharaka, Ijara, Mudaraba and Salam. It also set regulations for conventional banks to open windows selling Islamic products.
It had given regulatory approval to three major Moroccan banks to open Islamic subsidiaries: Attijariwafa Bank, BMCE of Africa and Banque Centrale Populaire, as well as to smaller lenders Credit Agricole and Credit Immobilier et Hotelier.
Subsidiaries of Societe Generale of France, Credit du Maroc and BMCI have also won permission to sell Islamic products.
The circulars lay down conditions and regulatory frameworks for banks to manage deposits, funds and investments under Shariah principles, which ban interest and pure monetary speculation.
Morocco’s government plans to issue its first Islamic bond in the domestic market in the first half of 2017; experts said that would stimulate business in the sector. However, the Parliament has yet to approve a bill regulating Islamic insurance.


Kuwait Projects Co. hires Goldman Sachs for sale of OSN — sources

Updated 21 November 2018
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Kuwait Projects Co. hires Goldman Sachs for sale of OSN — sources

DUBAI: Kuwait Projects Co. (KIPCO), the Gulf state’s largest investment company, has hired Goldman Sachs to advise it on the sale of its majority stake in pay-television operator OSN, sources familiar with the matter told Reuters.
OSN, which this year signed the first partnership deal in the region with Netflix, posted a 71 percent drop in income in the three months to Sept. 30, according to KIPCO’s latest financial results.
KIPCO and Goldman Sachs declined to comment.
KIPCO said in the results, released last week, that the company’s board had approved initiating a plan to divest its 60.5 percent equity interest in Panther Media Group, also known as OSN, and had engaged an international investment banker for the purpose. It did not disclose the name of the banker.
With the rights to broadcast into countries across the Middle East and North Africa, OSN has more than 180 channels, according to its website. Its other shareholder is Mawarid Group.
OSN faces subdued demand in its core markets due to piracy, geopolitical factors and fiscal reforms by governments which have led to sizeable expatriate populations leaving some of its core markets, said Anuj Rohtagi, director of group financial control at KIPCO in KIPCO’s third-quarter earnings conference call on Nov. 15. He added OSN was taking action to cut costs and attract new customers.
It is not the first time KIPCO has explored offloading at least some of its stake in OSN. In 2014, it said it planned to start the process for an initial public offering of OSN shares.