Malaysia

Sarawak welcomes Chinese investors to tap into Tanjung Manis #halal #hub

The #Malaysian government is encouraging investors from China to tap into the estimated USD3 trillion global demand for halal products by exploring business opportunities in Tanjung Manis Halal Hub (TMHH) in Bintulu, Sarawak. According to Second Minister of Resource Planning and Environment Datuk Amar Awang Tengah Ali Hassan, Malaysia is a pioneer in halal certification ensuring the integrity of halal products and services through strict compliance with Syariah requirements. Awang Tengah added that the Sarawak Government had established the TMHH which covers an area of 124,517 hectares making it the largest among all the other halal hubs in the region. Among the investment potentials in TMHH he revealed is the cultivation of food crops, aquaculture, poultry and livestock, food processing, cosmetics, and health products. On another note, Awang Tengah revealed that China has remained an important trading partner as well as a major source of Foreign Direct Investment (FDI) for Sarawak.

RHB Islamic To Disburse RM50 Million For #Entrepreneurs

RHB Islamic Bank is expecting to disburse at least RM50 million this year to facilitate the development of entrepreneurs. The fund is part of the Teras Fund programme provided via the Bumiputera Agenda Steering Unit (Teraju). According to RHB Islamic Bank's CEO Datuk Adissadikin Ali, the collaboration with Teraju had so far disbursed RM200 million as of 2016 from the total fund raised of RM400 million. He said the original fund for the programme was RM80 million, but RHB Islamic managed to raise the fund by leveraging on resources to RM400 million.

#Malaysia leads in #Islamic #banking assets in region, says World Bank report

Islamic finance has largely been a priority area in Malaysia for three decades and it is not about to slow down. The World Bank's recent Global Report on Islamic Finance highlighted Malaysia as having the largest Islamic banking assets in the region with US$156.7 billion (RM697.15 billion) as at 2013. Malaysia is also the second-largest economy in terms of total syariah-compliant financial assets. However, the report also suggested the need to address several challenges like the need for alternative investments. On a positive note, the report said the syariah governance framework was advanced in Malaysia. Within Asia, Malaysia has been dominating the sukuk issuance market. The US dollar-denominated sukuk have been growing, but sukuk denominated in Malaysian ringgit are growing even faster and dominate the market.

Islamic Banking M&A plausible, says AllianceDBS Research

According to AllianceDBS Research, a new wave of merger and acquisition (M&A) activities in the Islamic banking space is plausible, although the timing remains the key risk. Potential M&A candidates include the Malaysia Building Society (MBSB), and Bank Muamalat Malaysia (Muamalat). The research house added domestic Islamic financing growth was expected to continue outpacing conventional loans growth, driven by regulatory push for internationalisation of Islamic finance. This was mainly underpinned by a growing push by banks to fulfil Bank Negara Malaysia’s target of 40% proportion of Islamic financing. AllianceDBS predicts the big game-changer will be product innovation. The research house named the main Islamic banking proxy, the BIMB Holdings (BIMB) as the largest Shariah compliant financial institution with strong potential to lead product innovation.

#Malaysia chases the big money in #Islamic #finance

Islamic finance is the area where Malaysia leads the world. Malaysia has 54% of global sukuk outstanding, 314 Islamic investment funds worth RM100.6 billion ($22.7 billion), and an Islamic capital market that has tripled in size since 2005, accounting for 60.1% of the total Malaysian capital market. In August the Employees Provident Fund (EPF) launched its Shariah savings scheme to give members the option to convert their conventional account to an Islamic one. It has said it expects to invest an average of RM25 billion in Shariah assets every year and it intends to allocate a minimum of 45% of its assets into Shariah-compliant forms. Thus, EPF has sufficient scale to be very interesting to asset managers worldwide. Largely through that mechanism, there are now 20 fully fledged Islamic fund management companies operating in Malaysia.

Yinson converts US$780mil loan into Islamic financing facility

Yinson Holdings' subsidiary Yinson Production (West Africa) has converted its existing US$780mil conventional loan to an Islamic Murabahah term financing facility. Group executive chairman Lim Han Weng said this was the largest Islamic facility for floating production storage and offloading (FPSO) financing to-date. Maybank Investment Bank acted as the coordinating bank for the conversion while Maybank Islamic acted as the syariah adviser. Upon completion of the conversion, Yinson is expected to meet the debt over total assets financial ratio benchmark required by the Securities Commission for a syariah-compliant security.

Source: 

http://www.thestar.com.my/business/business-news/2017/01/27/yinson-converts-us$780mil-loan-into-islamic-financing-facility/

Bank Islam MD says unlikely to extend contract

Bank Islam's managing director Datuk Seri Zukri Samat said he would not extend his contract when his tenure ends in June this year. When asked on his successor, Zukri said there was still plenty of time to search for a successor since it was only January. On Bank Islam Visa Infinite MPN credit card-i, he said it was introduced in response to Bank Negara’s call for a cashless society. He said the collaboration with MPN was the bank’s continuous cooperation with the academic institutions starting with the introduction of the UniDebit card in 2012. Meanwhile, MPN chairman Professor Tan Sri Zakri Abu Hamid welcomed the strategic cooperation to strengthen the corporate image of both parties.

Fitch: #Malaysia's #takaful continues to enjoy higher growth than conventional peers

According to Fitch Ratings, Malaysia's takaful sector continues to enjoy higher growth than the conventional sector. This growth is driven by a low base, stable domestic consumption and increasing consumer awareness. The rating agency said that regulatory pressure would drive sector consolidation in the short term. As takaful operators realign their strategic focus and gradually retain more risks, Fitch expects some bottom-line volatility in the short term. For the first half of 2016 (1H2016), family takaful grew by 9.8%, while general takaful grew by 5.8%. This compared to 8.2% growth in conventional life and 2.6% in general insurance.

#Fund to spur foreign investment in Islamic finance

#Malaysia’s securities regulator has proposed establishing a fund to invest in the country’s Islamic finance funds and make them more attractive to institutional and foreign investors. The proposed fund is part of an Islamic fund and wealth management blueprint launched on Thursday. It would invest in multi-currency Islamic investment products managed by Malaysian-based asset managers. The fund could address challenges that Islamic funds have faced so far. Few Malaysian-managed funds are offered overseas but this is starting to change. CIMB Islamic Asset Management, for example, this week launched an Ireland-domiciled dollar-denominated sukuk fund. The Employees Provident Fund is launching a RM111.45 billion shariah-compliant retirement fund this month, which could serve as a boon to asset managers in the field.

SC unveils five-year blueprint to further strengthen #Malaysia as a leading Islamic investment hub

The Securities Commission Malaysia (SC) has launched a five-year Islamic Fund and Wealth Management Blueprint designed to drive further development and growth of Malaysia's Islamic capital market. The Blueprint aims to establish the country as a leading international centre for Islamic fund and wealth management. It was launched by Datuk Johari Abdul Ghani, Second Finance Minister of Malaysia, on behalf of Prime Minister Dato’ Sri Mohd Najib Tun Razak, at the International Fund Forum 2017. To be implemented on a phased approach, initial work programmes will include the formulation of a framework for SRI funds, the setting up of a global centre for Islamic capital market and the introduction of a digital investment services framework.

Major #Fintech #Achievements in Islamic Finance in 2016

The year 2016 records quite remarkable achievements in terms of financial technology (fintech). The Investment Account Platform (IAP), Malaysia’s first multi-bank platform for financial intermediation in the Islamic financial system, was launched on the 17th February 2016. The IAP serves as a central marketplace to finance small and medium enterprises (SMEs) with initial funds of RM 150 million. Eight Islamic Crowdfunding Platform operators from across the globe clicked together to form Islamic Fintech Alliance (IFT Alliance) and launched it on the 1st April 2016. Then, on the 26th September 2016, New York-based Wahed Invest launched Wahed, the world’s first automated Islamic investment platform. Two months later, the Kuala Lumpur-based Faringdon Group announced that it would be launching Asia’s first Shariah compliant Robo Advisor. The online tool called Algebra will provide automated portfolio management advice. Further progress of these initiatives and new innovative entrants will position 2017 for more excitements.

SCC ups #Sukuk scheme to RM3.5 billion

Sabah Credit Corporation (SCC) increased the size of its Sukuk Musharakah programme from RM1.5 billion to RM3.5 billion. According to CEO Datuk Vincent Pung, the move will allow SCC to consolidate outstanding Sukuk issuance and generate an additional RM1 billion for the corporation to plan its future loans growth. Pung also announced i-Cash, a personal loan facility, offering borrowers simplified and online loan processing and the flexibility of drawing the loan. Finance Minister Datuk Seri Musa Aman noted that SCC had anticipated a significant drop in profits of RM16 million initially to RM54 million for the year 2016, but instead reported a beyond expectation pre-audited profit of over RM60 million as of December 2016. He said the corporation has also donated over RM23 million through more than 150 Corporate Social Responsibility projects such as rural hostels, orphanages, half-way homes and centres for single mothers.

#Innovation in #Islamic #finance

Although Malaysia is a leader in Islamic finance research, very few of the research papers published have translated into feasible innovations, until recently. To help push the sector forward and bring the research and ideas to fruition, International Centre for Education in Islamic Finance, with the support of Bank Negara Malaysia, the Association of Islamic Banking Institutions Malaysia and the Malaysian Takaful Association, recently held the Islamic Finance InnoFest 2016. For this festival, INCEIF accepted idea submissions from all over the world, including Japan, Australia and Pakistan, to promote inclusiveness.

“We believe that to really push for innovation, we cannot be stuck in a silo. That is why it is not limited to only Malaysians,” says Associate Professor Dr Baharom Abdul Hamid, director at INCEIF’s Centre of Research and Publication and InnoFest chairman.

The #growth of #Islamic #financing in #Africa's #infrastructure

Funding Africa’s huge development needs has long represented a big challenge. This has spawned all kinds of innovative financing mechanisms in the past and could spell an opportunity for Islamic finance, notably haria-compliant bonds, or Sukuk. Still in an embryonic state in Africa – but growing nonetheless – these instruments could play a potential role in delivering large infrastructure projects, from building new airports to constructing power plants and building roads. While it is early days for Africa, on a global scale Islamic finance is not a new concept.
A longstanding feature of the financial markets of Malaysia – a world leader in the field – and across the Middle Eastern Gulf, its spread now encompasses non Muslim-centric territories worldwide. This is a pattern that is catching on, albeit slowly, in Africa. While northern Africa has provided a natural entry point for Islamic products, current activity now focuses on sub-Saharan markets, notably in West Africa.

‘Why #Nigeria #cannot #shun #islamic #financing #market’

A Chartered Accountant and Tax Administrator, Mr. Bicci Alli has said that the federal government as well as states cannot shun Islamic financial instruments whose market is valued at over $2.6 trillion, because it has the capability to bridge the infrastructure deficit in the country.
The federal government is presently looking for financial and legal advisers and trustee firms to organise its first Islamic bond in the domestic market, the Debt Management Office (DMO) said on Monday. Nigeria is working on a debut sovereign sukuk but has yet to determine the size of a potential deal. Issuance of a sovereign sukuk is part of a plan by Nigeria’s debt office to develop alternative sources of funding and to establish a benchmark curve.

MBSB gets nod for talks on proposed #merger with Asian Finance Bank

#Malaysia Building Society Bhd (MBSB) has received Bank Negara’s approval for talks on a proposed merger with Asian Finance Bank (AFB). MBSB will soon start negotiations with the existing Middle Eastern shareholders of AFB, namely Qatar Islamic Bank (66.67%), RUSB Investment Bank (16.67%), Tadhamon International Islamic Bank (10%) and Financial Assets Bahrain (6.67%), for the merger. The negotiations are to be completed within the next six months. For the nine months ended Sept 30, 2016, AFB reported a net profit of RM4.54 million, an 18.8% drop compared with RM5.58 million in the same period last year. MBSB has a goal to become an Islamic financial institution by 2020 through merger with an Islamic lender. It centres his business efforts on six areas, namely, business focus, right pricing, asset quality, cost cutting, retail collection and information technology initiatives.

Maybank sets up RM10 billion #sukuk programme

Malayan Banking (Maybank) has established a sukuk programme of up to RM10 billion in nominal value under the syariah principle of Murabahah. According to Maybank's announcement, the sukuk programme will provide the bank the flexibility to raise funds for its Islamic financial instruments and its business activities. The sukuk programme has been assigned a long-term rating of 'AAA' for issuances of senior sukuk Murabahah and 'AA1' for issuances of subordinated sukuk Murabahah by RAM Rating Services. Maybank IB is the principal adviser, lead arranger and manager, and book runner for the programme.

RHB aims to be among top three in Islamic banking

RHB Bank is eyeing the top three spot in the Islamic banking space for its syariah complaint unit. RHB Islamic Bank CEO Datuk Adissadikin Ali said growth in the recent past years had been strong and that the bank could continue riding on this growth. He said the contribution of Islamic banking assets to the group’s total assets is 25% and that the aim was to grow this figure to 40% by the year 2020. The group syariah business is identified as one of RHB’s key growth areas under its Ignite 2017 transformation programme. The bank intends to achieve by 2017 a return on equity of more than 14%, double contributions from Singapore to 10%, have 30% in overseas contribution, scale growth in small and medium enterprises, and have Islamic banking accounting for 30% of its assets.

#Malaysia-#Bahrain Should Lead World's Islamic #Fintech

Malaysia and Bahrain should take the lead in exploring the potential of introducing the world’s first Islamic financial technology (fintech). According to Bahrain Economic Development Board (EDB) Director David Parker, the favourable initiatives undertaken by regulators from both countries provide a positive edge for Islamic fintech. In Malaysia, Bank Negara Malaysia Governor, Datuk Muhammad Ibrahim said a regulatory framework to enable the adoption of fintech would likely be announced by year-end. During the 23rd Annual World Islamic Banking Conference held here, Bahrain Central Bank Governor Rasheed Mohammed Al Maraj hinted that the bank would soon issue regulations to facilitate fintech solutions. Bahrain Islamic Bank CEO Hassan Amin Jarrar described the need to introduce Islamic fintech to the world Islamic financial market as "critical" and if Malaysia and Bahrain do not take the first step, other big countries will snatch away the advantages.

Online #gold platform HelloGold endorsed as Shariah-compliant

#Malaysian fintech HelloGold is the first online gold platform to be endorsed as Shariah compliant by the Shariah Supervisory Board of Amanie Advisors. CEO Robin Lee showcased the savings platform at the global launch of the Shariah Standard on Gold at the World Islamic Banking Conference. According to Lee, with this platform everyone can buy gold and users are able to buy investment grade gold easily through their smartphones. He added that gold is a particularly good safe haven investment against foreign exchange risk and market shocks. Over the last 12 months, gold has risen by 17% against the Malaysian ringgit, 10% against the Thai baht, 9% against the Indonesian rupiah, 17% against the Philippine peso and 12% against the Singapore dollar. The HelloGold app is now available for use in Malaysia and is currently available on Google Play.

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