BBK launches Islamic investment banking arm

By Andy Sambidge

The Bank of Bahrain and Kuwait (BBK) has announced the launch of Capinnova Investment Bank, its Shari’a compliant investment banking arm.

A wholesale Islamic investment bank, Capinnova is licensed by the Central Bank of Bahrain and has an authorised capital of $500 million and paid-up capital of $125 million.

Capinnova’s chairman A. Karim Bucheery said: “The growth of Islamic banking industry in particular has been remarkable in recent years and it is expect to reach$4 trillion in the next five years according to the recent Standard and Poor rating agency.

"Capinnova Investment Bank aims to leverage on this exponential growth and further strengthen the Islamic Banking industry in Bahrain and across the region."

Capinnova’s core areas of business will include private equity, asset management and corporate finance.

“Capinnova’s vision is to be a world class Islamic investment bank offering a range of high quality products and services to a diverse clientele,” added Capinnova’s CEO Jamal Hijres.

Capinnova will provide a variety of products, including murabaha, ijara, mudaraba, musharaka, al Salam and istitsna'a, restricted and unrestricted investment accounts, syndications and other structures used in conventional finance, which have been appropriately modified to comply with Shari’a principles.

In recent years, Bahrain has rapidly become a global leader in Islamic banking, playing host to the largest concentration of Islamic financial institutions in the Middle East.

In addition, Bahrain is at the forefront in the market for Islamic securities (Sukuk), including short-term Government Sukuk as well as leasing securities.

BEST ISLAMIC FINANCIAL INSTITUTIONS IN INDIA (GLOBAL FINANCE 2008) : Kotak Mahindra

Kotak Mahindra is one of India's leading financial conglomerates, offering complete financial solutions that encompass every sphere of life. From commercial banking, to stock broking, to mutual funds, to life insurance, to investment banking, the group caters to the financial needs of individuals and corporates.

The group has a net worth of over Rs. 6,184 crore, employs around 20,000 people in its various businesses and has a distribution network of branches, franchisees, representative offices and satellite offices across cities and towns in India and offices in New York, London, San Francisco, Dubai, Mauritius and Singapore. The Group services around 5.6 million customer accounts.

Kotak Mahindra, one of India's largest financial conglomerates, has paved the way for Middle Eastern and other foreign investors to enter India's equity markets through shariah-compliant offshore funds. The firm's UK subsidiary was the first Indian institution to set up operations at the Dubai International Financial Center. Kotak Mahindra (International) has had a branch in Dubai for more than a decade. Despite its large Muslim population, India has been slow to introduce Islamic banking services, which are mainly limited to the cooperative sector.

Kotak Mahindra ( UK ) Limited (KMUK), has been licensed by the Dubai Financial Services Authority to conduct its operations from its branch in Dubai International Financial Centre.

It is the first Indian institution to set up at DIFC. This announcement was made by Mr Shyam Kumar, Director, KMUK in Dubai today.

Commenting on the initiative, Mr. Shyam Kumar said,

'Dubai International Financial Centre (DIFC) has created a global financial hub at Dubai. With its global infrastructure, DIFC is attracting most major international finance organisations to set up operations here. Kotak Mahindra has a strong commitment to be a part of this growing financial hub. We already have a presence in Dubai through Kotak Mahindra (International) Limited for over a decade now. The opening of the KMUK branch will further strengthen our presence here. '

Under the directions of His Highness General Sheikh Mohammed Bin Rashed Al Maktoum, Crown Prince of Dubai, UAE Defense Minister, and the President of the DIFC; a strategic Islamic Finance Advisory Council has been formed comprising key personalities from the industry to jointly work with the DIFC on matters relating to the development of Islamic Finance.