Nov 30 2008
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Dubai's Al Salam Investment links with top German bank to create regional Islamic finance powerhouse
Partnership with HSH Nordbank offers new model as experts look to Sharia principles to free stalled global liquidity
Dubai, November 30, 2008: Financial institutions in Dubai are gearing up for an Islamic finance-led upswing in the regional economy with Al Salam Investment (ASI), the Dubai-based investment company, the latest to launch a major initiative in the sector.
ASI has identified Islamic finance as the next big driver for the regional financial sector and today signed an agreement to partner with HSH Nordbank, a German financial institution and global leader in shipping and renewable energy finance, as it scales up to become a major player in the market.
The union of regional operator ASI with the conservative traditions of conventional global financier HSH Nordbank will create a strong player operating on Islamic principles initially in the GCC and in the medium term throughout MENA. Mr. Pegman Haghshenas, Chief Executive Officer of ASI, said: "The time is right for change and our expectations for this partnership, operating in line with Sharia principles, are high.
"Islamic finance offers a different model - one which could become the template for mainstream investment and funding. A new approach is needed and Islamic finance provides that."
Experts are convinced Islamic financial instruments can play a key role in freeing up the global financial system's stalled liquidity and have predicted that an increasingly prominent role for sukuks outside niche markets. These Islamic financial instruments have been part of a strong German trend towards Islamic finance that earlier saw the likes of the state of Lower Saxony issue its own sukuk. HSH Nordbank, a global player within its core sectors with a balance sheet of around 200 billion euros, is not merely maintaining Germany's interest in the market but is determined to take it further.
Mr. Michael Bresges, a director with HSH Nordbank, said: "This partnership with ASI opens the door to opportunities that cannot be found elsewhere at this time. There is real synergy between the traditional approach that has characterised HSH Nordbank's operations and culture and the low-risk, co-operative investment that are features of Islamic finance.
"We have received an enthusiastic response from institutions in the region and we are confident that we will see strong growth on the back of numerous opportunities."
The two partners are expected to formally set up a joint venture in 2009 to cement their partnership. Mr. Haghshenas said: "We are bringing something different to conventional methods of funding and investment. We believe this formula has the ability to make a genuine difference and our sphere of operation will eventually extend throughout the MENA region."
Al Salam Investment (ASI)
This Dubai-headquartered investment company focuses on the Middle East and North Africa region. Its asset classes include private equity, real estate and equity funds. Its main areas of operation are principal investing, asset management, and financial advisory. ASI was established in 2007 by a group of bankers and UAE national investors as a conventional Islamic investment company headquartered in Dubai and focusing on the MENA region.
HSH Nordbank is a strong commercial bank in Northern Europe. It is deeply rooted in its home market of Hamburg/Schleswig-Holstein and market leader in the corporate customer segment. To customers it offers an innovative range of products and services coupled with individual advice in all business areas, including Private Banking.
The bank operates at global level in selected growth markets. Its main focus is shipping, transportation, real estate and renewable energy. It is the world's biggest provider of ship finance and a leading provider of financial services in the transportation sector. HSH Nordbank is one of Germany's top three banks for real estate; on the international stage it focuses on the finance business involving top investors in the major property markets. It is represented at locations in Europe, Asia and America including the key international financial centres of New York, London and Luxembourg.
As an acknowledged partner in the international capital markets, it operates with specialist know-how in the handling of complex transactions and innovative capital market products. In addition it acts as a professional risk manager for customers.
Established on June 2, 2003, HSH Nordbank AG is the result of the merger between Hamburgische Landesbank and Landesbank Schleswig-Holstein (LB Kiel). It has total assets of some EUR 204 billion and some 4,900 employees around the world. HSH Nordbank has twin headquarters in Hamburg and Kiel.
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