Media Teleconference: The Importance of International Standards in Managing Defaults in Islamic Finance

 - Tuesday, May 21st 2013 [ME NewsWire]

(BUSINESS WIRE)-- Please join Dr. Robert Shapiro for a teleconference as he releases a new report on the failure of two Saudi Arabian conglomerates, the Saad Group and the Algosaibi Group, and the management of their debt defaults and restructurings. Dr. Shapiro will assess a number of questions raised about the Saudi Government’s handling of the restructuring process and the impact on Islamic finance and the Saudi business climate.
       

WHO:
     

Dr. Robert Shapiro, Chairman of Sonecon, an economic analysis and advisory firm, an advisor to the IMF, and former Under Secretary of Commerce for Economic Affairs in the Clinton administration.
       

WHAT:
     

Media Teleconference: The Importance of International Standards in Managing Defaults in Islamic Finance
       

WHEN:
     

Wednesday, May 22, 2013 at 8:30 am EDT; 4:30 pm GST
       

NUMBERS:
     

+1 212 231 2912 or 800 745 8951 (U.S.); 8000175534 (UAE); 08004960827 (UK); 08001815851 (Germany); 0800914638 (France); 8001012054 (Singapore); 1800813989 (Malaysia); 0018030176654 (Indonesia)
       

The 2009 defaults by the two Saudi conglomerates left as many as 100 international and regional financial institutions holding unrestructured debts. Four years later, many of those debts remain unresolved, including debts represented by sukuk, an Islamic instrument for corporate borrowing. The Saudi Government appears to have helped to negotiate an agreement between the Saad Group and its local creditors, but many foreign holders of Saad Group debt have received virtually no information, much less offers, about the disposition of their loans to the Group.

Many observers have charged that throughout this process, the Saudi Government has failed to ensure equal treatment for foreign and domestic creditors, or provide even minimal transparency to the restructuring process. These shortcomings violate the standards set forth by the World Bank, the International Monetary Fund, the OECD, and other international institutions. The Saudi approach also contrasts sharply with the behavior of other Muslim governments with regard to defaults of Islamic financial instruments, including Malaysia, Kuwait and the UAE, which have overseen or handled restructurings in accordance with international norms and best practices.

The Saudi Government’s handling of these recent defaults also raise questions for global companies and lenders about that government’s capacity and willingness to ensure a transparent and fair process for resolving the claims of international creditors, which in turn could reduce foreign direct investments, trigger capital flight, and damage the country’s economic outlook.

Please RSVP to mwarren@dcigroup.com if you plan to attend.

Contacts

For Sonecon

Miriam Warren, 202-262-6529

mwarren@dcigroup.com