Malaysia

Malaysia’s commodity murabaha push still has a way to go

Academics and industry participants in Malaysia are advocating further developments of treasury and money market products, notably via a new exchange initiative. But commodity murabaha structures developed to facilitate liquidity management by banks based on palm oil have attracted criticism from some quarters.
That’s why the Malaysian authorities are pushing ahead with efforts to make the country a world-leading Islamic financial hub. One of its latest initiatives has been to establish interbank money market instruments based on palm oil to satisfy the treasury needs of Islamic financial institutions.

Gulf Investment Corp issues its first local currency sukuk amounting to RM600m

Gulf Investment Corporation GSC Kuwait (GIC) had on Tuesday, March 1 issued its first local currency Sukuk amounting to RM600 million in the Malaysian market.
The GIC stated that this would be its third bond offering in Malaysia.

A new M'sian benchmark for sukuk investments

Referred to as the Bursa Malaysia Sovereign Shariah Index (BMSSI), the new Malaysian ringgit sukuk index was developed with the help of the Association of Islamic Banking Institutions Malaysia (Aibim) and will form part of Bloomberg's Islamic Finance Platform which seeks to leverage on the growing demand for information for syariah-compliant products and services.

Cross-border sukuk on the rise

Cross-border sukuk originations into and out of Malaysia are set to increase as the global sukuk market continues its rebound. Investors are looking for better and more diversified returns, as the Malaysian government’s policy of encouraging government-linked companies (GLCs) and local financial institutions and corporates to increase their cross-border exposure to Islamic capital market instruments start to take effect.

Huge potential for sukuk in Saudi and Gulf market: Al-Jasser

Al-Jasser had earlier delivered a “tour de force” lecture titled “Macroeconomic Management in an Oil Economy: the Case of Saudi Arabia” in the historic Examinations Hall at Oxford University in the presence of Adrian Wood, professor of International Development at Queen Elizabeth House, Oxford University; Farhan Nizami, director of the Oxford Centre for Islamic Studies (OCIS), and Nazir Tun Abdul Razak, chairman and CEO of Malaysia’s CIMB Bank Group and younger brother of Malaysian Prime Minister Najib Tun Abdul Razak.
The fact that Al-Jasser included Islamic finance as one of four main challenges of managing the Saudi economy going forward is a welcome departure from previous governors of SAMA who dare not speak the name of Islamic banking.

Islamic megabank gets Bahrain, Malaysia approval

A long-touted Islamic megabank has received approval from Bahrain and a preliminary green light from Malaysia to begin operations.
Saudi Arabia's Sheikh Saleh Kamel said the venture is still in discussions with Qatar to obtain a licence.

Retakaful firm Best Re sees growth in Africa, South America

Sharia-compliant reinsurer Best Re will grow its business in Africa and eventually expand into South America to diversify its sources of income which is mainly derived from Asia.
Asia, specifically countries such as China, Indonesia and Malaysia, accounts for three-quarters of Best Re's income and the company wants to bring this share to about 60 percent within five years.

Amanah Raya to help set up Islamic bank in Kazakhstan

Malaysian trustee company Amanah Raya Berhad is joining forces with Fattah Finance and the state-owned Development Bank of Kazakhstan to conduct a feasibility study to establish the second Islamic bank in the CIS country. Their purpose is to submit an application for an Islamic-banking license later this year under new legislation introduced by Kazakhstan in 2009 to facilitate the establishment of Islamic banks and the introduction of Islamic financial products in the country.

Arcapita to conduct rights issue

The investment firm Arcapita has said it is conducting a rights issue to raise fresh funds from shareholders, as it prepares to refinance a $1.1bn loan due next year.
The firm also plans to market the rights issue to new institutional investors in the Gulf region, Malaysia and other parts of Asia.

Elaf Bank to arrange sukuk in Southeast Asia

Jamil El-Jaroudi, chief executive of Bahrain-based Elaf Bank, has unveiled plans to arrange Islamic bonds in South East Asia.
The Islamic investment bank won a mandate to act as financial advisor on sukuk issues in Malaysia and Indonesia.

Prominent Saudi scholar warns on agenda against Shariah advisories

Malaysia adopted on Jan. 1 a new Shariah Governance Framework (SGF) for Islamic financial institutions (IFIs) that supersedes the Guidelines on the Governance of Shariah Committees of IFIs introduced by Bank Negara Malaysia (BNM).
One prominent international Shariah advisory to the Islamic finance industry, Muhammed Elgari of Saudi Arabia, agrees that Malaysia’s Shariah Governance Framework for IFIs could become a blueprint for other countries to follow.

Malaysia Debt Ventures to focus on Islamic finance

MALAYSIA Debt Ventures Bhd (MDV) will focus more of its activities on Islamic financing this year
The company was determined to support the government's effort to promote Islamic finance and use the funds raised from sukuk issues to finance development projects.

Amanah Raya plans Kazakhstan Islamic bank in 2012

Malaysian trustee firm Amanah Raya Bhd expects to obtain licences to set up Kazakhstan’s second Islamic bank in the second quarter of 2011 and begin operating the lender within a year.
Amanah Raya would have a 55 per cent stake in the joint venture company to be set up, state-run Development Bank of Kazakhstan will own 40 per cent and brokerage Fattah Finance the balance.

Gulf borrowers tap Malaysia for sukuk sales

Arabian Gulf borrowers are selling ringgit-denominated Islamic bonds at a record pace in Malaysia to raise funds for expansion and take advantage of demand in the world’s biggest market for Shariah-compliant bonds.
Dubai’s government is “likely” to sell bonds next year and a Malaysian offering is a possibility.

BNM consults market on Shariah parameter for Istisna contracts

Bank Negara Malaysia (BNM) published last week the draft of its latest Shariah consultation on Islamic financial products, the "Concept Paper of Shariah Parameter Reference 5: Istisna Contract (SPR5)". SPR5 is aimed at becoming the true source of reference on the nature and features of the Istisna contract for the Islamic financial services industry and to facilitate the consistent implementation of the contract in the Malaysian financial market.

Female Shariah Scholars See Gender Gap Closing

Asian Islamic financial institutions are attracting more female executives and scholars to fill a shortage of talent, setting a precedent for companies in the Middle East.
In November Malaysia’s Shariah Advisory Council appointed a second female scholar to its 11-member board. Indonesia has six women on its panel of 35 experts.

Tatarstan set for debut sukuk

Work on the feasibility study on the sukuk origination is set to start this month, after the President Rustam Minnikhanov of the Russian republic of Tatarstan has visited Malaysia in December and the signing of a memorandum of understanding (MoU) in Kuala Lumpur between the Tatarstan government, the local IFC Linova, Malaysia's Amanah Raya Berhad Group and Kuwait Finance House Malaysia (KFH Malaysia).

'M’sia has a clear lead in Islamic capital market’

The nation’s Islamic capital market is seen as being intelligently positioned within the evolving Islamic financial-services industry.
As one of the panel members at the 17th Annual World Islamic Banking Conference 2010 (WIBC 2010) in Manama, Bahrain, Zakariya cited two key factors that must be taken into consideration when tackling legal constraints namely the competency of the civil courts in hearing Islamic banking and finance cases, as well as the adherence to a recognised body such as the Syariah Advisory Council of Bank Negara, or Securities Commission of Malaysia.

Malaysia's central bank still reviewing Islamic mega bank bids

Bank Negara Malaysia is offering up to two new Islamic banking licences to foreign firms to set up banks with at least $1 billion of paid-up capital. The industry hopes that this will spur more lending and create bigger Islamic banks that can compete with global lenders.
Bankers say the bid to create a well-capitalised Islamic bank has been fraught with difficulties such as a struggle to raise sufficient capital and disagreement as to where the lender should be located.

Malaysia, Yemen, Gulf Investment, France: Islamic Bond Alert

The following borrowers are expected to sell Islamic bonds: MALAYSIA, YEMEN, DUBAI, GULF INVESTMENT CORP., FRANCE, SAUDI INTERNATIONAL PETROCHEMICAL CO., GENERAL ELECTRIC CO., PALESTINE MONETARY AUTHORITY, NAKHEEL PJSC, SABAH CREDIT CORP., CREDIT AGRICOLE SA, NOOR ISLAMIC BANK, NATIONAL COMMERCIAL BANK, KPJ HEALTHCARE BHD., EMIRATES TELECOMMUNICATIONS CORP., SENEGAL, ALBARAKA BANKING GROUP., ISLAMIC DEVELOPMENT BANK, THAILAND, KNM GROUP BHD., CAGAMAS BHD., SAUDI ARABIAN OIL CO., GAMUDA BHD., EGYPT, PT BANK MUAMALAT INDONESIA, SENAI-DESARU EXPRESSWAY BHD., MALAYSIA DEBT VENTURES BHD, INDONESIA, TURKEY, KAZAKHSTAN, PHILIPPINES, SAUDI ELECTRICITY CO., EMIRATES INTEGRATED TELECOMMUNICATIONS CO., LAFARGE MALAYAN CEMENT BHD..

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