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BNP Paribas, a pioneer in Islamic Banking

02 Août

BNP Paribas Islamic Banking

Backed by the strong expertise of its Business lines and the long-term relationship built with financial institutions across the world, by its dedicated coverage team, BNP Paribas has extended its capabilities in order to broaden its offer in Sharia-Compliant products.

Indeed, on June 17th 2003, BNP Paribas officially announced the set up of a specific Islamic Banking Unit. In late 2006, the Unit was renamed to BNP Paribas NAJMAH to reflect the leadership and the innovations Islamic solutions that this division could offer to its clients throughout the world with such type of investments.

Due to the pioneer position of Bahrain Financial Centre in the Islamic Banking world, BNP Paribas has decided that its global platform for Sharia-compliant products would be based in the Kingdom of Bahrain, and would focus mainly, but not only, on Middle Eastern and South East Asian markets.

Given the steady growth of the past decades, it became strategically clear that a dedicated division is needed to be set up in order, first of all, to combine BNP Paribas’ in-house Islamic capabilities and second, to expand the already broad range of products available.

BNP Paribas, active and seen as a pioneer in this domain since 1985, by being one of the first to structure Murabaha deposits, and later in 2006 , by introducing an innovative Islamic Certificate Programme, enabling BNP Paribas to provide a wide range of underlying assets and pay-offs, in a streamlined manner, to a larger Islamic investor base.

In this respect, BNP Paribas has developed strong credentials along the years.

1985: First Murabaha Deposits / Lending structured providing Islamic banks with short-term liquidity placement / lending opportunities.

1996: Caravan Fund: BNP Paribas launched one of the first Islamic Global Equity Fund.

1999: Faysal Shield Fund: First Equity linked Capital Protected Fund.

2002: Al Hidd project: The Al Hidd transaction (Bahrain), lead arranged by BNP Paribas, proved a milestone for the region. It was the first time a transaction of this nature successfully integrated an Islamic tranche into a financing package also containing an export credit agency covered tranche.

2004: Eitsalat: Etisalat (Saudi Arabia) appointed BNP Paribas as a financial advisor to raise US$2.35 billion to finance the cost of the license. BNP Paribas successfully raised the funds in 3 weeks from being mandated. This makes this Islamic loan not only the largest Islamic loan ever in the MENA region, but the largest Islamic financing ever in the world at that time.

2005: Dolphin US$1 billion Istisna’a & Ijara facility. BNP Paribas takes a leading role by acting as Mandated Lead Arranger and Documentation Bank in this strategic transaction. This represents the largest Islamic financing deal ever in the energy sector.

2006: Islamic Certificate Programme: BNP Paribas has introduced an Islamic certificate programme specifically dedicated to issue Islamic instruments. The programme is considered a milestone to the development of Islamic investment structured products where it provides a wider range of underlying assets and pay-offs. BNP Paribas’ Islamic Banking Products

Combining its capabilities with its Sharia expertise BNP Paribas offers a broad range of high added value Islamic investment products, bringing new and innovative solutions to its clients’ specific needs.

Asset-Liability Management & Treasury: Provide short-term placement / borrowing opportunities for Sharia compliant institutions with excess / shortage of liquidities: Murabaha Deposits Murabaha Lending.

Fixed Income : DCM Origination: engineer, structure, and distribute all sort of Islamic bonds on the behalf of Sovereign, Financial Institutions and Large Corporate issuers. Islamic Bonds: Sukuk Al Ijara, Sukuk Al Salam, Sukuk Al Murabaha, Sukuk Al Musharaka, Sukuk Al Mudaraba.

Interest rate-like & Currency hedging: Provides protection against interest rate variations and / or currency exposures.

Receivables Securitization: Either structured as an investment instrument for Islamic investors or as a way to meet capital adequacy ratio contraints.

Credit derivatives: in order to provide Islamic counterparties with either an additional risk management/hedging tool (as protection buyer) or new unfunded credit exposure (protection seller).

Equity: Provide plain Equity Brokerage on Sharia compliant stocks as well as capital protection of a single stock or a basket of equities structured as a fund.

Project Finance & Export Finance: Islamic Project finance Tranches: structures and arranges project finance deals including Sharia-compliant tranches.

Export Credit facilities & Islamic L/Cs.

Structured Finance: Asset Financing (Ijara): Aircraft, Shipping, Equipment, Real Estate.

Commodities Pre-financing based on Salam contacts.

Stock refinancing based on Murabaha contacts.

Asset Management: Dow Jones Equity Fund

Money Market Fund

Balanced Fund

FX Fund

Exchange Traded Fund

Sharia ComplianceAll BNP Paribas Islamic products and investments are Sharia compliant and are reviewed and approved by our distinguished in-house Sharia Supervisory Committee (SSC).

Source: BNP Paribas Bahrain

 
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Publié par le août 2, 2007 dans France

 

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