Malaysia

i-VCAP Receives Securities Commission approval to be a full-fledged Islamic Fund Management Company

i-VCAP Management Sdn Bhd announced it has received approval from the Securities Commission to operate as an Islamic fund management company. The firm is doing Islamic fund management under the general licence for some time.

Zainal Izlan Zainal Abidin is the CEO.

Global sukuk sales to fall again in 2009

Experts are expecting further drop in Sukuk isssuance in 2009. Local currencies help to support the markets, K. Salman Younis, head of Kuwait Finance House's Asian operations was cited.

Malaysia’s capital market fundamentals stronger: Securities Commission

Malaysia’s capital market is fundamentally and prudentially stronger than during the 1997/98 financial crisis, according to the Securities Commission (SC). The market’s exposure to the current global financial turmoil is indirect, the commission said in its Annual Report 2008 released yesterday.

The country also guarantees 100 % of bank deposit until 2010, it said.
The Malaysian Islamic capital market also proved to be relatively resilient with 47 sukuk issues worth RM 43.2 bn approved by the SC last year, which accounted for 31 % of all corporate bonds approved.

Malaysia's PLUS issues RM 745 mn Sukuk

Malaysia's PLUS Expressways issues additional RM 745 mn via a specical purpose company, PLUS SPV Berhad based on Musharaka to investors identified via a book building process. The size of the book was successfully increased from RM 400 mn to RM 745 mn under the Sukuk program.

Malaysian bourse to launch Commodity Murabaha platform in June

Liau Y-Sing reported on Reuters, 5 March that Malaysia's stock exchange will launch in June a platform to allow banks to execute Commodity Murabaha transactions, a popular but controversial Islamic contract with a market worth more than USD 100 bn according to the International Islamic Financial Market. Any tangible asset that is sharia-compliant can be used in commodity murabaha transactions and palm oil is one obvious example. Malaysia is the world's No. 2 palm oil producer.

But some religious scholars have criticised the structure, saying it resembles conventional-based lending instruments. The Accounting and Auditing Organisation for Islamic Financial Institutions is of the view that the contract, while not invalid, is not ideal.

Malaysian banks remain well capitalised

Malaysia is well placed to weather the global financial crisis, well capitalised and with adequate liquidity, Bank Negara Malaysia governor Tan Sri Dr Zeti Akhtar Aziz told the Oxford Business Group (OBG), a global publishing, research and consultancy firm. She said several years of reforms, institutional development and capacity building, continuous efforts to enhance corporate governance and risk management standards and practices had significantly strengthened Malaysia’s banking system.

OBG is to publish The Report: Malaysia 2009, the latest of its annual business guides, with a comprehensive review of the country’s economy.

Sharia scholar accepts fee for Guarantee

Liau Y-Sing reported via Reuters on 4 March that Mohd Daud Bakar, a renown Malaysian Sharia scholar, says banks may charge fees for guarantees but cannot sell the risk to a third party.

Etiqa Takaful Bhd crossed RM 1 bn in premiums

Etiqa Takaful Bhd recorded for the financial year ended June 30 last year a premium of RM 1.044 bn. It is the first takful company to cross this level and the largest in the world. Currently, the company has about a million policy holders.

Mohd Tarmidzi Ahmad Nordin is Chief Executive Officer.

Deloitte sets up KL Islamic Finance Centre of Excellence

DELOITTE is setting up an Islamic Finance Centre of Excellence in Kuala Lumpur. This is Deloitte’s only such centre in the region and one of three globally, alongside London and Dubai.

EONCAP Islamic Bank Bhd is eyeing 8 % growth in financing

EONCAP Islamic Bank Bhd is eyeing an 8 % growth in financing despite the economic slowdown. The bank has deposits and financing worth RM 4.3 bn and RM 4.8 bn respectively.

Malaysia: BNP Paribas Islamic targets USD 500 mn this year

Ellina Badri & Racheal Lee Mei Nyee reported on 16 February that BNP Paribas Islamic targets USD 500 mn assets this year.

Angelia Chin-Sharpe is BNP Paribas Investment Partners Malaysia and Brunei country head. Chin-Sharpe said that its current global assets under management and advisory for the Islamic business division stood at USD 500 mn. It intended to grow this to USD 2.5 bn in the next two years and is keen to work with takaful companies to provide them with investment solutions. Further BNP is planning an ETF.

Malaysia: Nomura Islamic Asset Management - strategy

Racheal Lee Mei Nyee reported on 16 February in The Edge Daily, that Nomura Islamic Asset Management Sdn Bhd plans to launch its first product by the second half of this year for the Malaysian market before venturing into the Gulf and other Asian regions, its managing director Toru Nakano said.

The company had set a rather conservative target of USD 1 bn (RM3.6 billion) worth of funds under management within five years. The conventional division currently manages more than USD 1 bn of funds, which are invested both locally and overseas. The Nomura Group had had a presence in the Middle East for 35 years, it was yet to be familiar with Islamic finance and asset management.

Malaysia: Aberdeen Islamic Asset Management - strategy

Racheal Lee Mei Nyee reported on 16 February in The Edge Daily, that Aberdeen Islamic Asset Management Sdn Bhd aims with the new licence to approach retail investors and launch funds, which it could not do under the conventional licence. The company is seeking seed funding from institutional investors first and look at retail funds only later.

Gerald Ambrose is managing director of Aberdeen Asset Management Sdn Bhd.

Bank Islam signs MoU with Bank Muamalat Indonesia for Estate Planning

Ellina Badri reported in The Edge Daily about the memorandum of understanding between Bank Islam Malaysia Bhd and Bank Muamalat Indonesia Bhd for the distribution of Islamic trust products.

Islamic trusts involve investments made following syariah principles and asset distribution according to Islamic rules of succession. The range of Islamic trust products include will-writing and estate administration services, and waqf, or a gift of property for religious or charitable purposes.

AmanahRaya-JMF looks into Islamic REITs

AmanahRaya-JMF Asset Management Sdn Bhd, which currently manages RM 7.5 bn in funds, is looking at going into Islamic real estate investment trusts (REITs) in the next two or three years, says managing director/chief executive officer Sharizad Jumaat, and exclude non compliant components by 2011.

Kuwait Finance House Malaysia more than doubles paid up capital

Kuwait Finance House Malaysia said last Friday it has received a USD 300 mn capital injection from its parent, increasing the paid-up capital to USD 500 mn.

PLUS plans RM 1 bn Sukuk sales to pay debt, fund projects

PLUS Expressways Bhd, Malaysia’s largest toll-road operator, plans to sell RM 1 bn, 5-year Sukuk to help repay maturing debt and finance expansion projects. Bank Islam Malaysia Bhd and CIMB Islamic Bank Bhd supports the sale of the Sukuk. The company aims to raise RM 350 mn in the coming months to refinance debt maturing in June and to raise another RM 200 mn in the second half of the year to fund a road project in Indonesia.

Asian Finance Bank may halve the size of its planned aviation fund

Loh Li Lian reported on 4 February on Reuters that Malaysian Asian Finance Bank may halve the size of its planned aviation fund to RM 500 mn (USD 138.2 mn) according to Mohamed Azahari Kamil, the chief executive officer of the bank.

PT Bank Negara Indonesia to sell sukuk in Malaysia

Business Times reported on 30 January PT Bank Negara Indonesia, the nation’s third-largest state financial services company, plans its first Islamic debt sale in Malaysia, president director Gatot Suwondo said.

Plans are about USD 50 mn, with a 5-year and 10-year maturity if the pricing is attractive.

Securities Commission, Malaysia Approves 3 New Foreign Islamic Fund Managers

News Agency Bernama reported on 29 January that 3 new foreign Islamic fund management companies (IFMCs) have been approved by the Securities Commission to start operations in Malaysia:

The new companies are Aberdeen Islamic Asset Management Sdn Bhd, BNP Paribas Islamic Asset Management Sdn Bhd and Nomura Islamic Asset Management Sdn Bhd; the others who have been approved to establish operations are Kuwait Finance House (Malaysia), DBS Asset Management, CIMB-Principal Asset Management, Global Investment House and Reliance Asset Management.

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