SERVING OUR COMMUNITY SINCE 1987
YEAR END REPORT 1999
February 29, 2000
are pleased to announce that Mr. Mike Maguid Abdelaaty has been appointed by the
Board of Directors as President of American Finance House – LARIBA. Mr.
Abdelaaty brings to your company a significant banking experience of over 20
years at increasing levels of management with Bank of America, Sanwa Bank and
Saudi Investment Bank. Please welcome Mr. Abdelaaty by calling to meet him
and/or visiting him at your company’s offices.
are pleased to announce that your company’s Board of Directors has voted to
grant the year 2000 LARIBA Award for Excellence in Islamic Banking, Finance and
Economics, as follows: Academic Division - to Mr. Thomas Mullins, Harvard
University. Mr. Mullins played a pivotal role in the start up and development of
the Harvard Islamic Finance Information Program, (“HIFIP”). This has added a
tremendous credibility and a large volume of research and development in Islamic
Banking in the United States. The Board has also voted to grant the
Practitioner’s Division award to Mr. Iqbal Khan, Managing Director, Islamic
Banking Services, Hong Kong and Shanghai Banking Corp. – HSBC, London, UK. Mr.
Khan played an important role in developing the Islamic Capital Market that
resulted in the financing of major projects that started the process of joining
Muslim countries economically and financially. Mr. Khan has also been an
important factor in communicating the concepts and principles of Islamic Banking
to leading Central Bankers in the United Kingdom and the United States. The
Awards will be handed out during the Seventh Annual LARIBA Awards Symposium and
Dinner to be held on Saturday April 29, 2000 at the Pasadena Convention Center
starting at 12:00 noon. The registration fee including dinner
and a copy of LARIBA Bank Book is $50 per person. PLEASE
MARK YOUR CALENDAR for APRIL 29, 2000 to join us. The symposium will feature
Messrs. Thomas Mullins, Executive Director, Harvard Islamic Finance (Harvard
University), Mahmoud Elgamal (Rice University), Bill Maurer (Univ. Calif.
Irvine), Nejatullah Siddiqui (Aligarh University and King Abdul-Aziz
University), Stephen Ross (MIT), Saleh Malaikah (CEO of Albaraka Investments),
and Mohammad Fadil, Esq. (Attorney in Georgia).
Many other scholars with significant contributions in the field are also
expected to attend. The Symposium & Awards Dinner will be attended by the
Mayor of Pasadena, political leaders in the California State Assembly, newspaper
and TV reporters, and community leaders.
were invited to present a paper at the Third Annual Harvard University Forum on
Islamic Finance held on October 1, 1999. We presented a paper entitled “The
Challenges of Offering LARIBA Products and Services in an American Bank”.
also participated in the organization and preparation of the Second Annual ISNA
Conference on Islamic Banking and Finance held on October 2 & 3, 1999. We
participated in the “Providers Forum” to introduce LARIBA’s products and
company is now registered to conduct business in 12 states including Arizona,
California, Colorado, Georgia, Illinois, Maryland, Massachusetts, Michigan,
Minnesota, New Jersey, Texas and Virginia.
company has become a real LARIBA.com company. We receive up to ten requests for
application, inquiries and LARIBA Bank book orders on our site daily from the
United States and many parts of the world. Approximately 1800 visitors a month
visit our site and the rate is growing.
company financed 31 projects totaling approximately $1.7 million from July 1999
until end of December 1999 consisting of single family homes, autos, equipment,
trade finance and construction financing.
The Board of Directors has approved the distribution to investors of approx. 6.5% for the third quarter and approx. 6.75% for the fourth quarter of 1999. This brings total distribution for the year 1999 to approx. 6.56%.
INTERNATIONAL ECONOMIC and FINANCIAL DEVELOPMENTS
THE UNITED STATES:
Gross Domestic Production (GDP) is expected to have grown at approximately 4% in
1999 and is projected to grow at a slower rate ranging between 3% and 3.5% in
the year 2000. Productivity of American labor increased by 2.9% in 1999, the
highest rise in 7 years. Rising productivity means less pressure on wage
Federal Reserve Board has increased the Discount rate by 0.25 percent and is
expected to follow up with another increase of 0.25 percent before May 2000 in
an effort to curb inflation. The Fed has also been active in curbing money
supply growth rate. Main sources of inflation are higher wages, due to historic
declines in unemployment, and sharp increase in oil and gas prices. The other
source of fear by the Fed has been the “wealth effect” prevailing in America
due to record stock market rise in the last five years.
US dollar has risen sharply against the Euro. This has reduced US exports and
sharply increased US imports. The result has been record current account deficit
and more export growth in Euroland. On the other hand, the dollar has declined
sharply against the Japanese Yen. This situation, if continues, may hurt the
hopeful recovery and growth of the Japanese economy.
at the Group of Seven meeting fear that a “hard landing” in US
economy may be caused by increases of interest rates by the Fed.
RIBA interest rate on US Government bonds are expected to reach seven to 7.25%
in the short-term. However, interest rates are expected to decline later to a
range of 5.75 to 6% in the long run.
the past decade, the United States has been experiencing the greatest and
longest bull market in history. Surprisingly, in terms of individual stocks, the
US market can be termed a bear market. If one looks at all stocks listed on the
New York Stock Exchange through end of November 1999, we find that over 60% of
these stocks have declined in 1999 and that includes over 50% of NASDAQ stocks.
It is believed that with the economy growing, corporate earnings rising and more
stocks down in 1999, there are many values remaining in the market. It is
believed that investment in US value stocks, and small- and mid- capitalization
stocks and in international markets may result in promising returns in 2000.
Please consult with your financial advisor to restructure your portfolio.
is expected to have reached 2% in 1999 and is expected to rise to 3% this year.
unified European currency, the Euro, weakened by 15% since its introduction in
January 1999. The main reason was the easy money policy implemented by the
European Central Bank, ECB. The lower Euro helped enhance exports from Euroland
and hence the economic growth in these 11 one currency zone.
RIBA interest rates are expected to rise by 0.5percent to 1.0 percent this year
in an effort by the ECB to combat inflation. The Bank of England raised rates to
6% for the second time this year.
is expected to experience a significant growth in the mergers and acquisition
activity in order to streamline markets, reduce overhead expenses, and enhance
efficiency along the same lines of what happened and is still happening in the
United States. However, the potential of stock appreciation of many of these
companies is very promising. Euroland may be a good place to look into for
diversification of your investment portfolio. Please consult with your adviser.
equity markets staged strong come back in the final two months of 1999.
grew by 1% in 1999 due to a 3.9% annualized decline in 3rd Q and
perhaps 4% in 4th Q and is expected to grow by 1.75% to 2.25% in
2000. This is mainly due to the huge monetary relaxation and pumping of money in
the economy through direct spending coupons to the citizens and government
financing of large public projects. Another reason has been the bank and
financial institutions restructuring efforts by the Japanese government. The 60%
rise in the share prices since1/99 suggests that investors agree with the
changes. Financial deregulation is forcing firms to focus on return on capital.
In some way, Japan looks like the US in the early 90’s when business engaged
in painful changes, and workers’ real income fell.
RIBA interest rates are expected to hold steady at around zero percent to help
the economy to grow further.
Japanese stock market was one of the real bright spots in the world market. The
market appreciated by 50% in U.S. dollar terms. Many portfolios investing in
Japanese stocks realized around 65 to 80% growth. Please consult with your
financial adviser about your portfolio diversification. It should be noted that
due to the 10-year bear market in Japan, equity ownership is currently at 6%,
which is a post war low. Japanese households are currently holding $11 trillion
in financial assets, 53% of which is in cash or cash equivalents. Part of this
money will soon come back to the market.
Asian markets grew at a significant rate of over 50% in 1999 on average. This
included the markets of South Korea, Thailand, Malaysia and Hong Kong. The
Indonesian market is still suffering from the excesses of ill-advised policies
and political instability. Malaysian independent economic policies were
vindicated. Many companies and private high net worth individuals reduced debt,
canceled many of their capital expenditure and purchases programs and increased
of the restructuring of the weakened “tigers” of Asia, many foreign
investors came back to take advantage of many of the operating areas that were
closed to multinational corporations. Mega-banks, insurance & finance
companies and investment banking firms came back with stronger presence in these
CRUDE OIL PRICES
oil prices rose sharply due to the decline of export from Iraq, the adherence of
OPEC producers to production quotas and increased demand due to economic
recovery in Asia and the developed countries. Oil prices reached over $ 30 a
barrel and are expected to stabilize in the range of $22-$24 a barrel by
PLEASE MARK YOUR
APRIL 29, 2000 at 12:00 Noon and Come to Pasadena
Pasadena Civic Center Auditorium, 300 E. Green Street,
Symposium on Islamic Banking and
Achievement Awards Dinner
Mr. Thomas Mullins, Harvard University, LARIBA
2000 Award – Academic Division
Founder of Harvard
Islamic Finance Information Program
Mr. Iqbal Khan, LARIBA 2000 Award –
Kong and Shanghai Bank, London, UK
Registration for Symposium & Dinner, $50 per Guest
Call Us at 424-449-4401, or 1-888-LARIBA-1 &/or
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Are you looking to finance real estate, home improvements, automobile, or equipment?
For more information, please call 1-888-LARIBA-1 )1-888-527-4221
Our professional staff will be delighted to serve your financial needs.
Please refer us to your friends.
THIS IS NOT A SOLICITATION TO BUY,SELL, &/OR SOLICIT BUSINESS AND FINANCING
IT IS A PROGRESS REPORT ON THE DEVELOPMENT OF THE COMPANY.