Bahrain-based Sakana Holistic Housing Solutions, the innovative Islamic mortgage finance provider was recently honored by the Indian Ladies Association (ILA) in Bahrain for their contribution to the annual Fundraiser “A Sixer For ILA ”-  a cricket tournament held among 20 teams from Bahrain that competed for the ILA Trophy. The funds collected from the event will be utilized towards running Sneha Recreation Center for children with special needs.
The appreciation ceremony was held under the patronage of His Excellency Dr George Joseph Ambassador of India on Saturday, 13th February 2010 at the Indian Ladies Association’s annual party and the award was accepted on behalf of Sakana by Mrs. Haya Ismail, Marketing Executive.
Commenting on the recognition, Mr. R Lakshmanan, CEO of Sakana said: “Sakana is pleased to support such charity events that have positive impact on the community. As a responsible corporate, Sakana is committed to contribute to the social and economic betterment of the society.”

Tough market conditions due to the financial crisis impacted the Bahrain real estate market and Sakana’s mortgage business, resulting in new customer approvals for the year being significantly lower than the previous year.  The mortgage assets for the year reduced from BD 32.12 Mil in 2008 to BD 28.43 Mil in 2009.  Accordingly, the total assets of the company reduced from BD 39.89 Mil in 2008 to BD 37.32 Mil in 2009. The company set aside BD 0.15 Mil towards impairment of mortgage assets.

Mr. Abdul Hakim Khalil Al Mutawa, Sakana’s Chairman commented: “Despite challenging market conditions, we have managed to post growth in net mortgage finance income and profits.   Our prudent mortgage underwriting and tight control of expenditure helped us to achieve these results.

Though we are seeing early signs of recovery in the global financial markets, the recovery is still fragile.  We are cautiously optimistic in terms of outlook for 2010.  The Government of Bahrain has included “housing” as a priority for citizens in its Vision 2030.  With a growing young Bahraini population and increasing per capita income, the long term outlook for residential property and mortgage is positive.

I take this opportunity to welcome Capinnova Investment Bank, the Shariah Compliant investment banking arm and fully owned subsidiary of BBK which has become Sakana’s new shareholder from early this year. Capinnova acquired the shares from BBK.”

Sakana’s Chief Executive Officer, Mr. R Lakshmanan said “Our challenge will be to obtain funding at reasonable cost which will enable us to offer competitive products to customers.  We achieved these results despite our funding cost increasing by 75%.

We are working in partnership with several leading developers and many of them have made considerable progress in terms of delivering the housing projects.  We will continue to make best efforts in achieving our vision of being a catalyst for the prosperity of the housing sector and the innovator of holistic housing solutions.”

Bahrain-based Sakana was a 50:50 joint venture between BBK and Shamil Bank. BBK took the decision to transfer the ownership of Sakana to Capinnova to strengthen and diversify the bank’s investments in the Islamic financial sector while complying with the principles of Islamic law.

Capinnova took this stake in Sakana this month and is in the process of completing all the legal formalities with regard to the transfer.

Sakana has been in commercial operations for three years and has an asset base on unaudited results of approximately $100m.

“Despite the depressed global market conditions in the real estate sector over the past year, Sakana continues to remain profitable, aims to be an innovator and catalyst,” said Capinnova chief executive officer Jamal Hijres.

The signing ceremony was held at BMI’s headquarters at the Bahrain World Trade Center and attended by Mr. R Lakshmanan - CEO, Sakana, Mr. Andrew Bainbridge - CEO, BMI, Mr. Fathi Ebrahim - Head Islamic Financial Services, BMI and Mr. Ajit Pai - Senior Manager Finance, Operations & IT, Sakana.

Commenting on the deal :

Mr. R Lakshmanan, CEO of Sakana said that “We are pleased to secure the trust and confidence of BMI during the midst of financial crisis and thank them for their support.  We are also impressed with BMI’s Islamic financing structuring capabilities, professionalism and speed of service in executing these deals”.

Mr. Andrew Bainbridge, CEO of BMI said that “We are pleased to further strengthen our relationship with Sakana. This facility demonstrates our commitment to actively pursue financing opportunities and provide funding to businesses that have good track records along with an acceptable risk profile, despite difficult economic conditions.  BMI offers its customers an extensive range of financial solutions to suit their Islamic and Conventional requirements”.

• Financial Results Q3 – 2009 (Reviewed)

• Financial Results Q2 – 2009 (Not reviewed)

• Financial Statements 2008 (Audited)

• Financial Statements 2007 (Audited)

• Financial Statements 2006 (Audited)

Mr. Lakshmanan’s presentation was on ‘Islamic Law & Finance – The new Silk Road to investment and business straddling Europe and MENA region’. The major focus of the presentation was on the rationale for trade and investment flows between the two regions - with GCC states buying bulk of their imports from Europe and EU being the main trade partner for Mediterranean countries.  Issues and challenges currently faced by MENA region was highlighted and the steps that have been taken to improve the regional economic integration in the Arab World.

Mr. Lakshmanan also discussed the current status of Islamic finance in Europe with UK being the gateway. He concluded by highlighting the opportunities by which a new Silk Road could be built to facilitate investment and business between the two regions particularly in alternative energy, infrastructure, education and health.  In addition Europe should make efforts to expand Islamic finance with inclusive approach by targeting non-Muslims with competitive product offerings.
Mr. Lakshmanan was also a panel speaker on ‘Islamic housing finance’ and ‘Comparative issues in structuring successful Islamic real estate transaction’.

The conference was part of the annual Barcelona Meeting Point International Real Estate Show & Symposium, one of the top three international realty events held in the European Union. The event was attended by large number of international delegates from both regions including members of the Arab Union for Real Estate Development (AURD).

The ten luxurious three-storey family homes have been designed to the highest standards of comfortable living.  The project is an arrangement which appeals to the long-held cultural preferences for housing which allows extended families to live “together”, while maintaining a degree of privacy. It is a sector of the housing market which has hitherto been largely untapped, and where there is strong sustainable demand, as seen in the number of families who opt to build on, or adjacent to existing properties.

Sakana’s CEO Mr. R Lakshmanan, said: “Sakana is intent on offering holistic housing solutions and ‘Sakana Busaiteen’ is the result of market research. Sakana as an innovator and catalyst has with pride taken this step forward to coin this development in keeping with the requirements of the contemporary family.  We are glad that Sakana as Bahrain’s leading market provider of mortgage finance has been able to develop such a niche concept and make our customers’ dreams a reality.”

“Sakana’s approach to property development is demand-driven, and the ‘Sakana Busaiteen’ “model” came about as we are intent on exploring untapped opportunities in Bahrain’s real estate market. This latest offering confirms our firm focus on offering a complete customer experience, in this case by providing a convenient and cost-effective alternative for families who wish to stay together,” he added.

At ‘Sakana Busaiteen’ each building is comprised of individual self-contained 3 bed room apartments, with shared common facilities.  All the ten heritage residences are individually created to incorporate touches of traditional architecture in their luxurious contemporary design.  The compound will offer a selection of facilities for each three-storey house, including parking, a swimming pool and garden area. Each home will be sold to a single buyer. The location offers an easy commute to Manama, as well as Muharraq’s commercial centre. Construction is expected to take approximately 14 months  with completion scheduled for March 2011.

Property development complements Sakana’s existing portfolio of Islamic property financing and property consultancy, and will add further value to its business offer, continuing its success of the past two years since start-up.

The Inter University Youth Festival, which is the first of its kind, aims to create an ideal platform for the youth of Bahrain to get closer to each other and provide the participating universities an opportunity to showcase their talent and take pride in their students.