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Sunday, January
05, 2020 / 03.00PM / Bukola Akinyele for Proshare WebTV / Header Image Credit: Meda Week
As the new year 2020 enters its first full
week, a review of developments that shaped Islamic Finance in Nigeria in the
year 2019 appears below:
Islamic Finance Global
Asset Size
According to the Islamic Financial
Industry Stability Report, the current global size of the market is
$2.19trn, which attests to a remarkable growth post-2008 financial
crisis.
Malaysia Leading
Global Hub For Islamic Finance
Malaysia is currently the leading hub for
Islamic Finance globally. At the end of 2017, it
continued to be the main driver for both Sukuk outstanding and issuance for the
year, with a global market share of 51% and 36.2% respectively, according to
the Malaysian Reserve Bank report.
Also, Thompson Reuters' Islamic Finance
Development Report 2018 showed that Malaysia remains a leader among 56 countries
for Islamic Finance Institutions.
Africa and Nigeria's
Potential Size
Africa's market size for
Islamic Finance as of 2011 was $18bn, while the potential for Nigeria since
then is over $17bn. Nigeria and Africa are the new frontiers for the growth of
Islamic Finance globally.
2019
Review
SEC
Commitment To Developing Nigeria's Non-Interest Finance Market
The apex regulator of the
capital market, the Securities and Exchange Commission (SEC) restated its
commitment in 2019 to provide the regulatory framework that will support the
growth and development of the non-interest finance market.
The Acting
Director-General of SEC, Ms. Mary Uduk, assured the market that it was
committed as a regulator to enabling the full implementation of the provisions
for a non-interest finance market contained in the 2015 to 2025 capital market
masterplan.
NSE
Listing Of Second N100bn Sukuk Ijara
The Debt Management Office of Nigeria on
July 23rd, 2019, listed the Second N100bn Sukuk Ijarah on The Nigerian Stock
Exchange.
The seven-year FGN Sukuk is due to mature
in 2025. The Sukuk had a rental rate of 15.743%, a 73-basis point discount from
the 16.47% rental rate of the maiden issuance listed in April 2018.
The Inaugural NSE
Islamic Finance Forum
The Nigeria stock exchange hosted the
inaugural Islamic Finance Forum in June 2019, which was an opportunity for
stakeholders to explore how the industry can boost liquidity and deepen the
capital market.
It had in attendance the Director-General
of the Debt Management Office Ms. Pat Oniha, the Divisional Head, Trading
Business, Nigeria Stock Exchange and the CEO of Lotus Capital Mrs. Hajara
Adeola amongst other personalities.
FMDQ Securities Exchange
Support
The FMDQ Securities Exchange also continued
its support for the growth of the Islamic Finance market, since the pioneer
listing of the FGN Sukuk Bond in 2018.
It continued to engage the Debt Management
Office and other key stakeholders on the prospects of further listings of
Sukuks in the market, which should see more activities occur in 2020.
NAICOM and Takaful
Insurance Companies
In 2019 the National Insurance Commission
(NAICOM) licensed two new Takaful Insurance Companies, namely; Cornerstone
Takaful Insurance Limited and Salam Takaful Insurance Limited.
The licensing of the new Takaful insurers
took the number of Takaful Insurance Companies in Nigeria to 4 with the first
two Noor Takaful Insurance and Jaiz Takaful Insurance, operating since 2016.
4th Africa International
Conference on Islamic Finance
Nigeria, for the first time, hosted the 4th
edition of the Africa International Conference on Islamic Finance, AICIF in
Lagos from November 4th to 5th, 2019. The
conference focused on the theme "Infrastructure Financing, Sustainability and
the Future of African Markets."
It had as keynote speakers His Royal
Highness Muhammad Sanusi II the Emir of Kano and Mr. Oussama Kaissi, the CEO of
the Islamic Corporation on Insurance Export Credit, ICIEC.
The event featured panel sessions that
discussed how Islamic Finance could support Nigeria and Africa's economic
development, as a veritable source of financing.
Watch Video
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