In its latest move to support economic growth amidst the COVID-19 pandemic, the Government of Indonesia has announced its plans to provide cash transfers and working capital loans for micro, small and medium-sized enterprises (MSMEs).  Last week, the Head of the National Economic Recovery Task Force (NERTF), Budi  Gunadi Sadikin, stated that the Government would facilitate IDR 2.4 million for 10-12 million MSMEs, and also provide up to IDR 2 million in working capital loans for MSMEs. In addition, Budi stated that low-interest working capital loans wou...

At the state Sukuk (SBSN) auction held on the 4th of August 2020, the Government of Indonesia absorbed IDR 11 trillion, exceeding its indicative target of IDR 8 trillion. The auction which was held through the Directorate General of Financing and Risk Management (DJPPR) of the Ministry of Finance, attracted IDR 39.77 trillion in bids, lower than the IDR 40.2 trillion reached at the previous auction on the 21st of July 2020.  Of the five series issued, the PBS027 series, carrying an average yield of 5.14% and set to mature on the 1...

Indonesia’s Manufacturing Purchasing Managers Index came in at 46.9 points in July 2020, an increase from the 39.1 points recorded for June 2020. According to Industry Minister, Agus Gumiwang Kartasasmita, this improvement was an affirmation and an indication that the economy was starting to “bounce back”.  According to Minister Kartasasmita, Indonesia would need to focus on increasing the demand side of the economy in order for the PMI to return to its pre-pandemic level recorded at 51.9 points in February 2020.  However, the Industry M...

In its latest survey in July 2020, IHS Markit noted a continued recovery in Malaysia’s manufacturing sector, with the headline IHS Markit Malaysia Manufacturing Purchasing Managers’ Index (PMI) recorded at 50.0 in July 2020, down marginally compared to 51.0 recorded in June 2020. IHS Markit stated that July’s reading was well above the indices recorded during the height of the COVID-19 pandemic, and was also above IHS Markit’s long-run average index of 49.0. With the increase in manufacturing output in July 2020 marking the second...

RAM Ratings (RAM) has reaffirmed Sabah Credit Corporation (SCC)’s outstanding Sukuk ratings at AA1/Stable/P1. According to RAM, the reaffirmation is based on the expectation of available financial support for SCC from the Sabah State Government (State) when required. SCC, which is wholly-owned by the State, plays a key role in the socio-economic development of the State of Sabah.  The above-mentioned support has been demonstrated via the subordination of SCC’s state government borrowings to SCC’s Sukuk, the conversion of SCC’s s...

In a statement issued to the press on the 3rd of August 2020, PT Mora Telematics Indonesia (Moratelindo) reported that it is in the process of conducting its Sustainable Public Offering of its Sukuk Ijarah I Phase II of 2020 (Sukuk Ijarah). With a maximum compensation of IDR 277 billion, the offering will be open until the 6th of August 2020. Moratelindo’s Sukuk Ijarah has been issued without scrip and offered at 100% value, divided into two series. Although not covered with a specific guarantee,...

In a Bourse filing released on the 3rd of August 2020, Bahrain-based Khaleeji Commercial Bank (KCB) reported the successful issuance of USD 159 million worth of Sukuk. This issuance is subject to approval from regulatory authorities as well as the shareholders at an Extraordinary General Meeting.  According to the filing, shareholders support the build-up of KCB’s capital base, by backing the issuance of Additional Tier 1 Capital Sukuk of up to USD 200 million. The issuance is anticipated to significantly strengthen KCB’s financ...

Islami Bank Bangladesh Limited (IBBL), Bangladesh’s private commercial bank, has announced plans to develop its Fintech platform to raise IBBL into a Fintech-based bank adhering to global standards.  Currently, IBBL uses its Fintech platform to authorise advances from branches to headquarters to provide better services to clients. By the end of 2020, management has planned the launch of real time online investment banking services for IBBL. In this regard, the Chief Executive Officer of IBBL, Md Mahbub-ul-Alam, explained that&nbs...

Official data from the Turkish Statistical Institute (TURKSTAT) showed that Turkey’s Economic Confidence Index (ECI) inched upwards for the third month in a row, reaching 82.2 points in July 2020, up 11.8% month-on-month.  The ECI reached a low of 51.3 points as Turkey implemented restrictive measures to curb the impacts of the COVID-19 pandemic in March and April 2020. With restrictions gradually eased in May 2020 and mostly lifted in June 2020, the ECI started its recovery, reaching 73.5 points in June 2020.   The rise in the index for July 2020 w...

Fitch Ratings (Fitch) expects Qatar’s Islamic banking sector to be impacted by lower oil prices and the COVID-19 pandemic, with profitability seen to be taking a hit in 2020. According to Fitch, the Islamic banking sector will see lower profit rates, lower business volumes, as well as higher financing impairment charges in 2020. A weakening in asset quality will be masked in the short-term, by financing deferral programmes and banks having regulatory flexibility with regards to the recognition of impairments. Fitch notes that continued economic disruptions will see weaker ass...