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Archive for November 28th, 2008

Islamic Development Bank Plans to Issue Sukuk

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Points of Essence:

  • IDB will issue sukuk to source aid funds for crisis affected member countries. For this purpose, a team has been set up to address the impact of the global financial crisis and identify investment projects in Muslim countries. Another team was was also established led by the Malaysian former premier, Tun Dr Mahathir Muhammad to set the new vision for the IDB to better assist Muslim countries and coordinate the cooperation among them for their mutual benefits. Zawya has the report.

JEDDAH – The Islamic Development Bank (IDB) will issue Sukuk (Islamic bonds) in order to collect funds from the international market place so as to support member countries affected by the global financial crisis.

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Written by Suapi Shaffaii

November 28, 2008 at 11:43 pm

Posted in General Issue

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Dr. Zeti: Sustaining Malaysia as a Platform for International Islamic Finance

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Points of Essence:

  • The Islamic banking in Malaysia continued to record growth with assets size stood at RM234.9 billion, a jump of 23 % from the previous year. The industry accounted for 16.7% of total assets in the industry.  With a total deposit of RM180.4 billion (27.7%  increase from last year) and a hike of 24.5%  in total financing to RM143.4 billion together with 93 new full-fledged Islamic banking branches opened this year, Malaysia is expected to maintain its lead in Islamic finance.
  • On the capital market side, the Malaysian sukuk market had a comfortable average annual growth of 22 % since 2001. Building up its niche in structuring innovative Islamic financial instruments, a slump in the sukuk issuance had no effects on Malaysia as the demands for more innovative products like Sukuk Musharakah had increased to 84% surpassing 58% mark of the total sukuk issuance in 2007. More new products have been churned out including residential mortgage backed securities, Commodity Murabahah deposit products, commodity based financing, credit card based on ujrah, as well as, structured products based on Musharakah, Mudarabah and Ijarah.
  • A conducive environment for innovative advancement that is supported by a regulatory framework will always be the hallmark of lslamic finance in Malaysia. as that ensures not only the stability of the system but also promotes the active and vibrant functioning of the system. The liberalization of the Islamic finance industry with the setting up of foreign Islamic subsidiaries in its Islamic financial system will enhance the outreach of Islamic finance and strengthen Malaysia’s international linkages. With all the framework put in the right places, Malaysia is set to sustain its status as an Islamic finance leader. Read the full speech by the Malaysian central bank’s governor when opening HSBC Amanah Malaysia in Kuala Lumpur recently.

Governor’s Address at the Launching of HSBC Amanah Malaysia Berhad: “Sustaining Malaysia as a Platform for International Islamic Finance”

Speaker : Governor Tan Sri Dato’ Sri Dr. Zeti Akhtar Aziz
Venue : Kuala Lumpur, Malaysia
Date : 25 November 2008
Language : English

It is my pleasure to be here today at this official launch of “HSBC Amanah Malaysia Berhad” (HSBC Amanah). This launch is significant in a number of respects. It reflects the continued expansion of Islamic finance in Malaysia , taking place at a time of great uncertainty in the global financial system. The launch of HSBC Amanah, as an Islamic subsidiary of an international financial group, is also significant as it will contribute towards enhancing further the international dimension of Islamic finance in Malaysia , thus strengthening our international financial and economic linkages with other parts of the world.

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Written by Suapi Shaffaii

November 28, 2008 at 4:35 pm

Brunei approves Islamic Banking Order 2008

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Points of Essence:

  • Brunei has undertaken a massive revamp of its Islamic finance regulation and supervision. Islamic Banking Order 2008 and Takaful Order 2008 were introduced as part of the legislative reforms. This set of legislation aims at better regulating and supervising of Islamic finance. It is uncertain whether Brunei will also come up with a legislation on Islamic investment and capital market.  Apart from providing condusive environment for enhancing the growth of Islamic finance business in Brunei, the two Orders will encourage competition among Islamic finance players. Brunei Times has the report.

Order to expand and strengthen Islamic banking and takaful

Minister of Finance 2, Pehin Orang Kaya Laila Setia Dato Seri Setia Awang Haji Abd Rahman Hjai Ibrahim

BRUNEI MUARA
Tuesday, November 25, 2008
Focus will be on captive insurance, re-insurance centre takaful & re-takaful

BY THE consent of His Majesty the Sultan and Yang Di-Pertuan of Brunei Darussalam, the Ministry of Finance recently introduced the Islamic Banking Order 2008, aimed at expanding the Islamic banking sector in Brunei at the same time increasing the competitiveness among players by creating a level playing field as well as strengthening the supervision and regulation of Islamic banking activities.

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Written by Suapi Shaffaii

November 28, 2008 at 11:24 am