America Movil plans to keep current KPN strategy - unions

The logo of America Movil is seen on the wall of the reception area in the company's corporate offices in Mexico City February 13, 2013.

Credit: Reuters/Edgard Garrido

BRUSSELS | Wed Aug 28, 2013 6:41pm BST

BRUSSELS (Reuters) - Mexican telecoms group America Movil (AMXL.MX) will keep KPN's (KPN.AS) current strategy if its proposed 7.2 billion euro ($9.6 billion) bid for the telecoms company is successful, the group told unions on Wednesday.

Mexican billionaire Carlos Slim's America Movil sent its CEO Daniel Hajj to meet with union representatives and Dutch economic affairs minister Henk Kamp to give more details about its planned bid for KPN.

"They made clear to us that the current strategy of the management in terms of investments and employment would be kept. There would be no changes in those matters in the short term," a spokesman for union Abvakabo-FNV said.

America Movil, which already owns close to 30 percent of KPN, did not give any job guarantees to the unions.

"I don't know whether America Movil will make any promises or give guarantees in the coming period ahead of the official bid. As a union we hope so because it would make it easier for us to be positive about the takeover," a spokesman for union Qlix said.

America Movil said earlier this month that its financing for the bid was in place and it expected the bid of 2.40 euros per share to proceed in September.

A spokesman for the Dutch economic affairs ministry said that the talks with America Movil were fruitful and that contacts between the minister and the Mexican group would continue.

A spokeswoman for America Movil did not comment on the meetings.

(Reporting by Robert-Jan Bartunek, additional reporting by Sara Webb; Editing by Louise Heavens)

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Exclusive: SocGen plans $300 million sukuk program in Malaysia - sources

A logo is seen is seen in front of French bank Societe Generale headquarters in La Defense near Paris, February 13, 2013.

Credit: Reuters/Christian Hartmann

By Al-Zaquan Amer Hamzah

KUALA LUMPUR | Sat Aug 24, 2013 3:42am EDT

KUALA LUMPUR (Reuters) - Societe Generale (SOGN.PA) will launch a 1 billion ringgit ($300 million) Islamic bond program in Malaysia, two sources familiar with the deal told Reuters, becoming the second major European bank to issue sukuk and the first to do so in Asia.

SocGen, France's second-largest listed bank, is planning to issue the first tranche of the sukuk by the year-end, said one of the sources, who declined to be identified as he was not authorized to speak on the matter.

Western banks looking to raise capital are increasingly drawn to the Islamic bond market as the cost of credit is lower than in conventional markets. The Middle East unit of HSBC Holdings (HSBA.L) tapped the market in 2011 with a five-year $500 million issuance.

The growing popularity of Islamic debt as a choice of investment among Muslim banks and funds is also buoying the outlook for sukuk, as Islamic bonds are known.

Issuers of sukuk do not pay interest, a practice forbidden in Islam. Instead, buyers of sukuk become co-owners of the debt and receive annual profits from the issuer.

Global sukuk issuance grew 54 percent to $131.2 billion last year, with Malaysia accounting for 74 percent of primary market issuances.

Saudi Arabia followed with a 8 percent market share, and the United Arab Emirates with 4.7 percent and Indonesia with 4.6 percent, according to KFH Research, an Islamic investment research firm.

Malaysia has emerged as the world's No.1 market for primary sukuk issuances, with its strong regulatory framework, low taxes and geographical proximity to expanding Asian wealth.

The Malaysian central bank last month implemented new laws to stress compliance with Islamic laws, introducing higher penalties and making sharia advisors legally liable for the first time.

Hong Leong Islamic Bank (HLCB.KL) is advising the SocGen deal, according to the source.

SocGen will soon seek approval for its issuance plans from Malaysia's Securities Commission, having already received the green light to become a bond issuer from the central bank, the source said.

The central bank did not immediately respond to a request for comment, while a Hong Kong-based spokesperson for SocGen declined to comment.

The funds raised will go towards buying assets in Dubai, where SocGen's Middle East private banking operations are headquartered, said the source.

"Everything is in place," the source said.

EYE ON MALAYSIA

The issuance will help SocGen diversify its funding sources while benefiting from attractive premiums.

In the past year, three-year AAA-rated sukuk have offered yields of 3.65 to 3.72 percent, while conventional bonds with a comparable tenor and rating have yielded 3.69 to 3.76 percent. The lower yield range for sukuk translates into higher savings for issuers.

SocGen's sukuk in Malaysia will carry tenors of up to 15 years, according to the second source.

"For European countries that have yet to develop a regulatory framework for Islamic finance, Malaysia is an attractive destination," said Baljeet Kaur Grewal, managing director and vice chairman of KFH Research.

The large number of industry players in Malaysia, including foreign institutions mandated to invest in Islamic instruments, creates a ready market with significant demand for sukuk, said Kaur.

"There are a number of corporations planning to raise funds in the Malaysian Islamic capital market, from Australia to the Middle East, and this trend looks set to continue."

Other foreign companies such as the National Bank of Abu Dhabi NBAD.AD and Singapore-based palm oil producer Golden Agri-Resources Ltd (GAGR.SI) have in the past year tapped Malaysia's sukuk market.

In the first seven months of this year, issuers in Malaysia raised 19.8 billion ringgit through 47 sukuk, according to Thomson Reuters data.

That was a decline of nearly a third from a year earlier due to uncertainties surrounding a May election in Malaysia and a dip in external demand.

However, demand from Malaysia's public institutional funds such as the Employees Provident Fund and Lembaga Tabung Haji has remained resilient.

($1 = 3.3 ringgit)

(Additional reporting by Bernardo Vizcaino in SYDNEY and Umesh Desai in HONG KONG; Editing By Stuart Grudgings and Ryan Woo)

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Exclusive: SocGen plans $300 million sukuk program in Malaysia - sources

A logo is seen is seen in front of French bank Societe Generale headquarters in La Defense near Paris, February 13, 2013.

Credit: Reuters/Christian Hartmann

By Al-Zaquan Amer Hamzah

KUALA LUMPUR | Sat Aug 24, 2013 3:42am EDT

KUALA LUMPUR (Reuters) - Societe Generale (SOGN.PA) will launch a 1 billion ringgit ($300 million) Islamic bond program in Malaysia, two sources familiar with the deal told Reuters, becoming the second major European bank to issue sukuk and the first to do so in Asia.

SocGen, France's second-largest listed bank, is planning to issue the first tranche of the sukuk by the year-end, said one of the sources, who declined to be identified as he was not authorized to speak on the matter.

Western banks looking to raise capital are increasingly drawn to the Islamic bond market as the cost of credit is lower than in conventional markets. The Middle East unit of HSBC Holdings (HSBA.L) tapped the market in 2011 with a five-year $500 million issuance.

The growing popularity of Islamic debt as a choice of investment among Muslim banks and funds is also buoying the outlook for sukuk, as Islamic bonds are known.

Issuers of sukuk do not pay interest, a practice forbidden in Islam. Instead, buyers of sukuk become co-owners of the debt and receive annual profits from the issuer.

Global sukuk issuance grew 54 percent to $131.2 billion last year, with Malaysia accounting for 74 percent of primary market issuances.

Saudi Arabia followed with a 8 percent market share, and the United Arab Emirates with 4.7 percent and Indonesia with 4.6 percent, according to KFH Research, an Islamic investment research firm.

Malaysia has emerged as the world's No.1 market for primary sukuk issuances, with its strong regulatory framework, low taxes and geographical proximity to expanding Asian wealth.

The Malaysian central bank last month implemented new laws to stress compliance with Islamic laws, introducing higher penalties and making sharia advisors legally liable for the first time.

Hong Leong Islamic Bank (HLCB.KL) is advising the SocGen deal, according to the source.

SocGen will soon seek approval for its issuance plans from Malaysia's Securities Commission, having already received the green light to become a bond issuer from the central bank, the source said.

The central bank did not immediately respond to a request for comment, while a Hong Kong-based spokesperson for SocGen declined to comment.

The funds raised will go towards buying assets in Dubai, where SocGen's Middle East private banking operations are headquartered, said the source.

"Everything is in place," the source said.

EYE ON MALAYSIA

The issuance will help SocGen diversify its funding sources while benefiting from attractive premiums.

In the past year, three-year AAA-rated sukuk have offered yields of 3.65 to 3.72 percent, while conventional bonds with a comparable tenor and rating have yielded 3.69 to 3.76 percent. The lower yield range for sukuk translates into higher savings for issuers.

SocGen's sukuk in Malaysia will carry tenors of up to 15 years, according to the second source.

"For European countries that have yet to develop a regulatory framework for Islamic finance, Malaysia is an attractive destination," said Baljeet Kaur Grewal, managing director and vice chairman of KFH Research.

The large number of industry players in Malaysia, including foreign institutions mandated to invest in Islamic instruments, creates a ready market with significant demand for sukuk, said Kaur.

"There are a number of corporations planning to raise funds in the Malaysian Islamic capital market, from Australia to the Middle East, and this trend looks set to continue."

Other foreign companies such as the National Bank of Abu Dhabi NBAD.AD and Singapore-based palm oil producer Golden Agri-Resources Ltd (GAGR.SI) have in the past year tapped Malaysia's sukuk market.

In the first seven months of this year, issuers in Malaysia raised 19.8 billion ringgit through 47 sukuk, according to Thomson Reuters data.

That was a decline of nearly a third from a year earlier due to uncertainties surrounding a May election in Malaysia and a dip in external demand.

However, demand from Malaysia's public institutional funds such as the Employees Provident Fund and Lembaga Tabung Haji has remained resilient.

($1 = 3.3 ringgit)

(Additional reporting by Bernardo Vizcaino in SYDNEY and Umesh Desai in HONG KONG; Editing By Stuart Grudgings and Ryan Woo)

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Exclusive: SocGen plans $300 million sukuk program in Malaysia - sources

A logo is seen is seen in front of French bank Societe Generale headquarters in La Defense near Paris, February 13, 2013.

Credit: Reuters/Christian Hartmann

By Al-Zaquan Amer Hamzah

KUALA LUMPUR | Sat Aug 24, 2013 3:42am EDT

KUALA LUMPUR (Reuters) - Societe Generale (SOGN.PA) will launch a 1 billion ringgit ($300 million) Islamic bond program in Malaysia, two sources familiar with the deal told Reuters, becoming the second major European bank to issue sukuk and the first to do so in Asia.

SocGen, France's second-largest listed bank, is planning to issue the first tranche of the sukuk by the year-end, said one of the sources, who declined to be identified as he was not authorized to speak on the matter.

Western banks looking to raise capital are increasingly drawn to the Islamic bond market as the cost of credit is lower than in conventional markets. The Middle East unit of HSBC Holdings (HSBA.L) tapped the market in 2011 with a five-year $500 million issuance.

The growing popularity of Islamic debt as a choice of investment among Muslim banks and funds is also buoying the outlook for sukuk, as Islamic bonds are known.

Issuers of sukuk do not pay interest, a practice forbidden in Islam. Instead, buyers of sukuk become co-owners of the debt and receive annual profits from the issuer.

Global sukuk issuance grew 54 percent to $131.2 billion last year, with Malaysia accounting for 74 percent of primary market issuances.

Saudi Arabia followed with a 8 percent market share, and the United Arab Emirates with 4.7 percent and Indonesia with 4.6 percent, according to KFH Research, an Islamic investment research firm.

Malaysia has emerged as the world's No.1 market for primary sukuk issuances, with its strong regulatory framework, low taxes and geographical proximity to expanding Asian wealth.

The Malaysian central bank last month implemented new laws to stress compliance with Islamic laws, introducing higher penalties and making sharia advisors legally liable for the first time.

Hong Leong Islamic Bank (HLCB.KL) is advising the SocGen deal, according to the source.

SocGen will soon seek approval for its issuance plans from Malaysia's Securities Commission, having already received the green light to become a bond issuer from the central bank, the source said.

The central bank did not immediately respond to a request for comment, while a Hong Kong-based spokesperson for SocGen declined to comment.

The funds raised will go towards buying assets in Dubai, where SocGen's Middle East private banking operations are headquartered, said the source.

"Everything is in place," the source said.

EYE ON MALAYSIA

The issuance will help SocGen diversify its funding sources while benefiting from attractive premiums.

In the past year, three-year AAA-rated sukuk have offered yields of 3.65 to 3.72 percent, while conventional bonds with a comparable tenor and rating have yielded 3.69 to 3.76 percent. The lower yield range for sukuk translates into higher savings for issuers.

SocGen's sukuk in Malaysia will carry tenors of up to 15 years, according to the second source.

"For European countries that have yet to develop a regulatory framework for Islamic finance, Malaysia is an attractive destination," said Baljeet Kaur Grewal, managing director and vice chairman of KFH Research.

The large number of industry players in Malaysia, including foreign institutions mandated to invest in Islamic instruments, creates a ready market with significant demand for sukuk, said Kaur.

"There are a number of corporations planning to raise funds in the Malaysian Islamic capital market, from Australia to the Middle East, and this trend looks set to continue."

Other foreign companies such as the National Bank of Abu Dhabi NBAD.AD and Singapore-based palm oil producer Golden Agri-Resources Ltd (GAGR.SI) have in the past year tapped Malaysia's sukuk market.

In the first seven months of this year, issuers in Malaysia raised 19.8 billion ringgit through 47 sukuk, according to Thomson Reuters data.

That was a decline of nearly a third from a year earlier due to uncertainties surrounding a May election in Malaysia and a dip in external demand.

However, demand from Malaysia's public institutional funds such as the Employees Provident Fund and Lembaga Tabung Haji has remained resilient.

($1 = 3.3 ringgit)

(Additional reporting by Bernardo Vizcaino in SYDNEY and Umesh Desai in HONG KONG; Editing By Stuart Grudgings and Ryan Woo)

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Exclusive: SocGen plans $300 million sukuk programme in Malaysia - sources

A logo is seen is seen in front of French bank Societe Generale headquarters in La Defense near Paris, February 13, 2013.

Credit: Reuters/Christian Hartmann

By Al-Zaquan Amer Hamzah

KUALA LUMPUR | Sat Aug 24, 2013 8:43am BST

KUALA LUMPUR (Reuters) - Societe Generale (SOGN.PA) will launch a 1 billion ringgit ($300 million) Islamic bond programme in Malaysia, two sources familiar with the deal told Reuters, becoming the second major European bank to issue sukuk and the first to do so in Asia.

SocGen, France's second-largest listed bank, is planning to issue the first tranche of the sukuk by the year-end, said one of the sources, who declined to be identified as he was not authorised to speak on the matter.

Western banks looking to raise capital are increasingly drawn to the Islamic bond market as the cost of credit is lower than in conventional markets. The Middle East unit of HSBC Holdings (HSBA.L) tapped the market in 2011 with a five-year $500 million issuance.

The growing popularity of Islamic debt as a choice of investment among Muslim banks and funds is also buoying the outlook for sukuk, as Islamic bonds are known.

Issuers of sukuk do not pay interest, a practice forbidden in Islam. Instead, buyers of sukuk become co-owners of the debt and receive annual profits from the issuer.

Global sukuk issuance grew 54 percent to $131.2 billion last year, with Malaysia accounting for 74 percent of primary market issuances.

Saudi Arabia followed with a 8 percent market share, and the United Arab Emirates with 4.7 percent and Indonesia with 4.6 percent, according to KFH Research, an Islamic investment research firm.

Malaysia has emerged as the world's No.1 market for primary sukuk issuances, with its strong regulatory framework, low taxes and geographical proximity to expanding Asian wealth.

The Malaysian central bank last month implemented new laws to stress compliance with Islamic laws, introducing higher penalties and making sharia advisors legally liable for the first time.

Hong Leong Islamic Bank (HLCB.KL) is advising the SocGen deal, according to the source.

SocGen will soon seek approval for its issuance plans from Malaysia's Securities Commission, having already received the green light to become a bond issuer from the central bank, the source said.

The central bank did not immediately respond to a request for comment, while a Hong Kong-based spokesperson for SocGen declined to comment.

The funds raised will go towards buying assets in Dubai, where SocGen's Middle East private banking operations are headquartered, said the source.

"Everything is in place," the source said.

EYE ON MALAYSIA

The issuance will help SocGen diversify its funding sources while benefiting from attractive premiums.

In the past year, three-year AAA-rated sukuk have offered yields of 3.65 to 3.72 percent, while conventional bonds with a comparable tenor and rating have yielded 3.69 to 3.76 percent. The lower yield range for sukuk translates into higher savings for issuers.

SocGen's sukuk in Malaysia will carry tenors of up to 15 years, according to the second source.

"For European countries that have yet to develop a regulatory framework for Islamic finance, Malaysia is an attractive destination," said Baljeet Kaur Grewal, managing director and vice chairman of KFH Research.

The large number of industry players in Malaysia, including foreign institutions mandated to invest in Islamic instruments, creates a ready market with significant demand for sukuk, said Kaur.

"There are a number of corporations planning to raise funds in the Malaysian Islamic capital market, from Australia to the Middle East, and this trend looks set to continue."

Other foreign companies such as the National Bank of Abu Dhabi NBAD.AD and Singapore-based palm oil producer Golden Agri-Resources Ltd (GAGR.SI) have in the past year tapped Malaysia's sukuk market.

In the first seven months of this year, issuers in Malaysia raised 19.8 billion ringgit through 47 sukuk, according to Thomson Reuters data.

That was a decline of nearly a third from a year earlier due to uncertainties surrounding a May election in Malaysia and a dip in external demand.

However, demand from Malaysia's public institutional funds such as the Employees Provident Fund and Lembaga Tabung Haji has remained resilient.

(Additional reporting by Bernardo Vizcaino in SYDNEY and Umesh Desai in HONG KONG; Editing By Stuart Grudgings and Ryan Woo)

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Disaster plans the magical answer

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U.S., Japan fiscal plans escape mention in G20 communique

G20 finance ministers and central bank governors pose for a family photo as they meet in Moscow, July 20, 2013.

Credit: Reuters/Grigory Dukor

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