Islamic finance making strides in Canada

2020/02/12 Leave a comment

Relatively less coverage in Canadian media although there are a number of players.

One of the more recent stories I have seen in “mainstream” media is www.cbc.ca › news › canada › toronto › 2-men-acquitted-of-all-fraud…2 men acquitted of all fraud, theft charges in Shariah … – CBC.ca:

Although currently not quite in the very centre of attention of the global Islamic finance industry, the Canadian Islamic finance scene in the recent past has experienced growing interest from domestic and international investors, as it developed a rising number of Shariah-compliant investment and financing offerings. The reason is that more Muslims are seeking halal banking and finance products and – in general – an open-minded and progressive society is looking for alternative and socially conscious ways of investing.

Canada is home to an estimated 1.5mn people following the Islamic faith, or around 4% of the population, which makes Muslims the second largest religion in the country, while it is also the fastest-growing. Most of them are immigrants, but there is also a growing percentage of Muslims born in Canada and a smaller, but increasing number converting from other religions to Islam. Most of them live in the Greater Toronto and Greater Montreal area and are generally middle-class and well educated with considerable grades of financial literacy. Overall, it is estimated that the number of Canadian Muslims will double in the coming decade. Besides, the Muslim community in Canada is quite young, so there is definitely a large potential for mortgage, car, house and personal insurance, credit cards and consumer loans. Multiple-language offerings, personalised services and modern technology-based banking and investment products further create demand in Islamic banking.

These facts, paired with Canada’s global competitiveness and ease of doing business, its AAA credit rating, its well-supervised financial market with strong risk management mechanisms, a sound banking system and a financial regulatory regime which has shown to be compatible with many Islamic finance instruments make a solid background for a thriving Islamic banking and finance landscape.

This situation, together with open-minded non-Muslims on the outlook for ethical and sustainable investment, has raised particular demand for halal mortgages and sukuk and Islamic mutual funds, Islamic insurance, or takaful, as well as commodity- and infrastructure-backed investment. Notably, Canada’s wealth in natural resources, which ranges from mining to hydrocarbons, combined with its ambitious infrastructure development agenda provide countless investment opportunities for investors looking for Shariah compliance in accordance with the asset-backed product requirements of Islamic finance.

There are already a number of Islamic finance players, with the most established being United Muslim Financial, Habib Canadian Bank, Al-Ittihad Investment, Al Yusr, Manzil Bank, Ijara Community Development Corp, Islamic Co-Operative Housing Corp, Ansar Co-operative Housing Corp, Qurtuba Housing Co-op, An-Nur Housing Cooperative, Amana Auto Finance Canada, Assiniboine Credit Union, newer players such as Iana Financial, Wealthsimple Halal, ShariaPortfolio Canada, Global Iman Fund, as well as a number of other medium-sized and smaller player and mortgage cooperatives. Besides, there are a growing number conventional banks and financial institutions opening Islamic windows or planning to do so, among them Canadian Imperial Bank of Commerce or the Canada Mortgage and Housing Corp.

According to the Toronto Financial Services Alliance, a public-private entity seeking to turn Toronto into a global financial center, the Canadian banking sector currently has around $18bn worth of Shariah-compliant mortgages, while international sukuk could generate $130bn in domestic infrastructure investment managed using a combination of both Islamic and environmentally and socially responsible investing methodologies.

Another area where Canada is likely to expand its Islamic finance sector is takaful. Large insurance companies such as Manulife Financial and Sun Life Financial are currently gaining experience from their takaful-based insurance subsidiaries they have opened in Malaysia and Indonesia and are also developing ethical mutual insurance products bearing in mind that mutual insurances policies are very similar to takaful as they provide a fair and transparent relationship between policyholders and insurer.

In a nutshell, three are plenty of opportunities for Islamic banking in Canada with a Muslim population that will increase substantially in the future and with a growing interest of foreign investors noticing that Canada is developing into an Western hub for Islamic investment and finance, following the footsteps of the UK.

Source: Islamic finance making strides in Canada

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This Is What Racism Looks Like in the Banking Industry

2019/12/12 Leave a comment

Good long read and good to see that this was documented:

Jimmy Kennedy earned $13 million during his nine-year career as a player in the National Football League. He was the kind of person most banks would be happy to have as a client.

But when Mr. Kennedy tried to become a “private client” at JPMorgan Chase, an elite designation that would earn him travel discounts, exclusive event invitations and better deals on loans, he kept getting the runaround.

At first, he didn’t understand why. Then, last fall, he showed up at his local JPMorgan branch in Arizona, and an employee offered an explanation.

“You’re bigger than the average person, period. And you’re also an African-American,” the employee, Charles Belton, who is black, told Mr. Kennedy. “We’re in Arizona. I don’t have to tell you about what the demographics are in Arizona. They don’t see people like you a lot.” Mr. Kennedy recorded the conversation and shared it with The New York Times.

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There is nothing Orwellian about collecting accurate, real-time data: Barrie McKenna

2018/11/05 Leave a comment

Good commentary. Given the Conservatives legacy in downgrading the Census to the less accurate National Household Survey in 2011, their record on these kinds of issues is suspect.

And, as McKenna notes, “Worse than Big Brother is Blind Brother:”

To hear Conservatives spin it, Statistics Canada’s plan to gather the banking and spending records of hundreds of thousands of Canadians is akin to “Big Brother on steroids” and an “Orwellian intrusion into the lives of Canadians.”

The truth isn’t nearly as sinister. Rest assured, the government is not plotting a massive surveillance campaign to find out what you ate for lunch or your monthly mortgage payment.

Guess what? Ottawa already has your social insurance number – because it gave it to you. And it has your tax returns.

The government does, however, need better data to provide a complete and accurate portrait of Canada’s economy and society, in real time. As part of a “modernization” of its operations, Statscan wants banks, cellphone companies, retailers and other companies to share more of the so-called big data they have, and leverage them for the collective public good.

As Canada’s chief statistician Anil Arora put it: “Traditional statistics gathering methods are no longer sufficient to accurately measure Canada’s economy and social changes.”

Yes, some of the information Statscan wants to gather is personal. But all personal identifiers, including names, addresses and social insurance numbers, would be removed before any of it is compiled and released to the public. That’s what the agency already does routinely with census data, the monthly household survey and vast amounts of competitively sensitive corporate information.

Statscan has been peeking into our lives for a long time. Unfortunately, response rates from the agency’s traditional surveys have been falling, leaving it with often suspect and outdated data to feed into its key reports. The agency says getting access to financial transactions is vital to producing a timely, accurate picture of the economy.

As it should, Statscan is working closely with the federal Privacy Commissioner Daniel Therrien to ensure personal data are not put at risk, or shared publicly. It’s up to Mr. Therrien, who last week launched an inquiry into Statscan’s big data pilot project, to set the rules, and then let the agency do its job.

Statscan is hardly unique. Statistics agencies around the world are similarly leveraging big data for public policy purposes. And that’s unambiguously a good thing, according to University of British Columbia economist Kevin Milligan.

“This research is vital to forming good government policy and providing good economic information to the private sector,” Mr. Milligan says. “Statistics Canada should and does work with the privacy commissioner to balance the good that comes from research to the potential challenges to privacy.”

It’s ludicrous to suggest Ottawa is spying on Canadians. What Statscan is doing is tapping into what the private sector already knows about all of us, and aggregating it for public consumption.

If you’re seriously concerned about letting others see your financial records, shopping habits and internet surfing behaviour, well, that horse left the barn a long time ago.

Just think for a minute what companies such as Toronto-Dominion Bank, Bell, Facebook, Google, Amazon or the operator of the Highway 407 toll road already know about what you did today, or in the past month. Stitch it all together, and it’s your life in bits and bytes.

Canadians should be more concerned that there are adequate controls over what these companies are doing with your data. Perhaps Canada’s big banks are resisting giving your data to Statscan because they are more interested in exploiting it themselves.

The more ominous privacy threat may not be Statscan. The greater risk may lie with the major private-sector collectors of big data, many of which are foreign owned and store it all far beyond the reach of the government. And they often operate with far weaker privacy constraints than government agencies.

Governments already know plenty about you. There are census data, passport photos and records, tax filings, municipal property records, health records, driving offences and court records. No reasonable person would suggest this is somehow part of a nefarious Big Brother spying plot.

The agency’s data-collection pilot is not the problem. It is part of the solution. For years, Statscan’s ability to do its job was eroded by steady budget cuts. The current Liberal government reinstated some that funding in this year’s budget, with an additional $41-million over five years to improve the agency’s ability to do its job.

Worse than collecting more data is having a data deficit. Governments, and businesses, risk making major mistakes without accurate, real-time data.

Worse than Big Brother is Blind Brother.

Source: There is nothing Orwellian about collecting accurate, real-time data: Barrie McKenna

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ICYMI: Moving past diversity: RBC’s journey to rid its upper ranks of ‘unconscious bias’

2015/02/04 Leave a comment

Good interview with outgoing RBC CEO Gord Nixon and taking diversity and inclusion to the next level and making people aware of unconscious bias. Well worth reading:

Diversity is about mix. Inclusion is really putting that mix to work for you. This unconscious-bias work, when we started last year, we had (esteemed scholar and co-author of Blindspot: Hidden Biases of Good People) Dr. Mahzarin Binaji come and speak with our senior leadership team and other employees. We really felt it was the next frontier of this work — trying to get to the more subtle issues and the more politically incorrect or more difficult to speak about (because bias is not an easy thing to talk about). We are working to really get people to become self-aware. And I think along with that it’s also realizing that having a bias doesn’t make you a bad person. We all have them. What’s important is recognizing them and then looking for ways to actually mitigate those biases. We’re doing this in a number of different ways. One is just for individuals — influential individuals (people who make important decision in the company). We really had a lot of our senior people go through this awareness building. I hear leaders say, “I was putting together a team to be working with this important client and as I was looking at people I was going to select, I realized that I was actually looking for somebody like me.” That’s often what your natural bias is.

I think maybe to provide a very practical example. Sometimes you find people assuming that a woman with young children won’t accept a promotion that involves travel because you heard about some woman who did it. The answer there is, don’t assume that. Ask the woman if she is interested in being a candidate for a role that involves travel. Our assumptions and our biases get us there automatically. Or, you think, “This is a new immigrant and why is it relevant to understand how they do banking in a different country?”. Actually, it’s very relevant because we have new immigrants coming to this country and understanding how they do banking allows us to serve them better. So, those are the practical aspects, practical issues that we try to address when they actually happen by having good processes.

You need somebody else to be there and stop you and say, “Hey, I think we might have a bias here” and by making this a more common language in our organization — by talking about it and by having the sessions — it gives you permission to have those conversations and it just makes it easier to go there where sometimes you’re not sure or you don’t want to offend people. This just makes it part of how we do business.

Moving past diversity: RBC’s journey to rid its upper ranks of ‘unconscious bias’ | Financial Post.

The report, by RBC and EY, also well worth reading:

Outsmarting our brains: Overcoming hidden biases to harness diversity’s true potential 

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