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Facts about International Islamic Liquidity Management Corp (IILM)

with one comment

27 October 2010
 
What?
  • The International Islamic Liquidity Management Corp (IILM) is a collaborative effort by 11 central banks or monetary agencies, as well as two multilateral organisations to assist institutions offering Islamic financial services in addressing their liquidity management. The initiative will also facilitate greater investment flows for the Islamic financial services industry. The IILM will also be part of their efforts to enhance cross-border flows and also as part of an initiative to facilitate the growing significance of the international dimension of Islamic finance and its increased role in the international financial system
  • The IILM is expected to be operational within the first half of next year and be based at Petronas’s Twin Tower, Kuala Lumpur.
  • 

Who?

  • Shareholders – The regulators collaborating with Bank Negara Malaysia for the setup of IILM would be the shareholders of the initiative, as well as sit on its board whom each would contribute US$5 million (RM15.5 million) as their capital for IILM.
  • Signatories- 13 signatories for the setup of IILM such as BNM, the central banks of Indonesia, Iran, Luxembourg and the United Arab Emirates, and multilateral organisations such as The Islamic Development Bank and the Islamic Corporation for the Development of the Private Sector

How?

  •  The IILM will issue short-term papers in international reserve currencies, such as the US dollar and the euro
  • The initial ones will be in major currencies because it is to facilitate cross-border liquidity management
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Written by Suapi Shaffaii

October 28, 2010 at 11:26 am

One Response

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  1. Best wishes for the Islamic Banking Liquidity Managers. Regionwise/citywise Inter bank (Islamic)groups need to be formed to facilitate lending/borrowing of ‘Halal’ funds on need. A monthly/fortnightly settlement session may be organized for payment of profit on borrowed funds. The rate payable may be arrived at on the average rate of profit earnings among the islamic banks in the city/region. The feasibility, mechanism, other related details may be worked out by the decision making Islamic bankers locally with active involvement of Sharia scholars. This way we can form a Islamic INterbank Market and improve fund management.


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