MBSB, unit plans RM7b Sukuk programme

KUALA LUMPUR: Malaysia Building Society Bhd (MBSB) and its unit plan to undertake up to RM7bil Sukuk programme.

MBSB said on Monday it proposed to set up a 15-year structured covered Sukuk commodity Murabahah programme of up to RM3bil which is part of its fundraising exercise.

It also said its unit Jana Kapital Sdn Bhd proposed to set up a 16-year Sukuk commodity Murabahah programme of up to RM4bil.

MBSB said it holds the shares in Jana Kapital on trust for a charitable organisation.

“The proposed establishment of the Sukuk Murabahah programme is to facilitate the issuance of structured covered Sukuk under the structured covered Sukuk programme,” it said.

MBSB said the two programmes were approved by the Securities Commission via its letters dated Oct 25.

(The Star Online / 28 Oct 2013)

---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Malaysia's Maybank launches Islamic asset management unit

The Islamic asset management sector is gradually making a comeback after years of stagnation, having seen a total of 88 funds liquidated globally in the past two years as slumping equity markets reduced investor interest.

Firms such as Britain's Threadneedle Investments, which set-up in Malaysia this month, now plan Islamic funds that screen their portfolios following religious guidelines such as bans on tobacco, alcohol and gambling.

The new unit would leverage the Maybank group's network of business lines, which range from consumer banking to Islamic insurance, as well as its geographical presence across Asia.

"The missing link within the Maybank group is Islamic asset management," Nor Azamin Salleh, chief executive of Maybank asset management said on Tuesday.

The new unit aims to launch Asian-themed investment funds using a bottom-up investment strategy, with products to be marketed primarily in Malaysia and Indonesia, Salleh said.

"We are looking at trying to bring an ASEAN plus North Asia product. Our approach is more on the ground, a bottom-up approach," he said.

Earlier this month, Maybank acquired Indonesian asset management firm PT GMT Aset Manajemen, and it would also explore opportunities in the Middle East through Maybank Investment Bank's stake in Saudi Arabia's Anfaal Capital, Salleh added.

(Reuters / 29 Oct 2013)

---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Malaysia, UAE Tie Up To Boost Economic Ties, Islamic Finance

The central banks of Malaysia and the United Arab Emirates signed a pact on Friday to foster closer economic ties between the two countries, including in the area of Islamic finance.

The pact signals stronger cooperation between the two financial hubs, which held a combined $181 billion in sharia-compliant banking assets as of 2011, despite growing competition for a share of Islamic business.

Governors of both central banks signed the memorandum of understanding on the sidelines of the International Monetary Fund and World Bank annual meetings in Washington.

It follows stronger cooperation between the Islamic finance centres, in particular the Gulf and Southeast Asian regions, despite traditional differences in the design and implementation of sharia-compliant financial products.

Both central banks are key backers of the Malaysia-based International Islamic Liquidity Management Corp, an institution tasked with addressing a shortage of interbank lending products for Islamic banks.

Last year, Malaysia’s securities commission revised its guidelines for screening equities that qualify for Islamic investment, moving them closer to the approach used in the Gulf.

The global Islamic banking industry is expected to tip $1.3 trillion by year-end. It follows religious principles such as a ban on interest and pure monetary speculation.

(Gulf Business / 14 Oct 2013)

---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Malaysia: Islamic finance laws reviewed

KUALA LUMPUR: The Law Harmonisation Committee Report 2013 released yesterday documents the current phase of the committee’s initiatives since its inception in 2010.

The high-level committee has been set up to review, harmonise and further strengthen the legal infrastructure to facilitate the conduct of Islamic finance in a bid to reinforce Malaysia’s leadership role in building and maintaining a solid foundation for the development of Islamic finance.

The committee has a mandate to recommend legal reforms that will advance the development of Islamic finance and achieve greater certainty and enforceability of Islamic finance contracts domestically.

A total of nine issues concerning 17 laws were reviewed, it said in a press release. And after extensive consultation and research, recommended amendments were made on four issues, which have been escalated to the relevant Government ministries, departments and agencies.

The first recommendation is to introduce provisions in court rules on the imposition of late payment charges on judgement debts in Islamic financial cases as permitted by the Syariah Advisory Councils of Bank Negara and the Securities Commission.

Further, allowing better access to financing, particularly Islamic financing, for consumers where it involves the charging of reserve lands through recommended amendments to reserve land legislations at all states has also been recommended. Next, the committee will look into facilitating Islamic financing involving landed property through the recognition of Islamic finance in the National Land Code 1965.

And finally, it recommends facilitating the introduction and usage of innovative and more globally accepted Syariah-compliant product structures for the Islamic money market through appropriate modifications in the Companies Act 1965 that would enable a more efficient conduct of collateralised commodity murabahah transactions.

The first recommendation has been fully implemented, while the remaining are in the process of being implemented.

The committee is headed by the former chief justice Tun Abdul Hamid Mohamad.

( The Star Online / 08 Oct 2013)

---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Singapore and Malaysia urged to collaborate on Islamic financing

SINGAPORE: Singapore and Malaysia should look for more cross-border opportunities to collaborate on Islamic financing.

This is according to speakers at the inaugural Islamic Finance Services Conference on Tuesday.

Experts said Singapore should also widen its breadth of Islamic finance products to cover the areas of retail, real estate and equities, in order to spur growth in this area.

Malaysia is the world leader in terms of Islamic financing, making up about 30 per cent of the more than US$1 trillion worth of global assets in Islamic finance.

As for Singapore, the growth momentum in Islamic financing continued unabated even when certain tax incentives expired earlier this year.

In Budget 2013, the Singapore Government said it will tax Islamic finance business at the standard 12 per cent rate instead of 5 per cent, the current rate, when the incentive expires on March 31.

Nazmi Camalxaman, associate director of Group Islamic Banking at CIMB, said: "I think Singapore has a lot of potential, especially in terms of Islamic asset management. It is untapped in Singapore. So I think if Singapore plays its cards right and chooses the products and services wisely, it will become a strong player in terms of asset management."

CIMB Singapore has secured about S$400 million worth of Islamic commercial and corporate banking deals this year.

This is almost three times the amount of Shariah-compliant deals the bank transacted last year.

Experts said Singapore must continue to play to its strengths.

Zainul Abidin Rasheed, advisor of the Middle East Business Group at the Singapore Business Federation, said: "Singapore does not have to emulate the kind of moves that Malaysia has because Singapore by itself is a very strong financial sector and we have our own strengths, but there is still room for us to see how we can best tap the growing market in terms of finance, whether from Southeast Asia or the Middle East."

Other ASEAN players are also keen to tap into that growth.

Ariff Sultan, regional director (Asia) at Ideal ratings, said: "Governments and the exchanges have worked together in trying to find a more sustainable growth of Islamic finance in ASEAN.

"There is a common working platform that ASEAN exchanges are coming together to be able to inter-trade within ASEAN and in that space, both also looking at creating Shariah-compliant equities."

Other analysts are anticipating the likes of Singapore, Thailand and Indonesia pushing out such Islamic equities through the ASEAN exchanges platform in the near future. 

(Channel News Asia / 01 Oct 2013)

---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Malaysia Remains Forerunner In Global Sukuk

KUALA LUMPUR, Sept 24 (Bernama) -- Malaysia remains a forerunner in global sukuk with the global outstanding sukuk amounting to over US$148 billion (RM474 billion) as at June 2013, which represents 60.4 per cent of the total global sukuk.

Deputy Prime Minister Tan Sri Muhyiddin Yassin (pix) said the number reflected Malaysia's rapid growth in sukuk compared with its number of only US$1.5 billion (RM5 billion) of global sukuk in 2001.

"Being a conducive environment for sukuk transactions, I certainly believe that Malaysia has what it takes to attract more institutions from all regions of the global aiming to tap Malaysia's Islamic finance marketplace and the pool of liquidity," he said at the opening of the 10th Kuala Lumpur Islamic Finance Forum (KLIFF 2013) in the capital, Tuesday.

He said credit must be given to Bank Negara Malaysia, the Securities Commission Malaysia, Shariah scholars and the Islamic financial industry community for their efforts to bring Malaysia's Islamic finance marketplace to the current level of sophistication.

He said this was in line with the vision for a comprehensive and progressive Islamic finance marketplace, which has grown from strength to strength for over 30 years.

Muhyiddin said as Malaysia continued to grow its Islamic finance industry, there was a need to revisit and review any particular areas of divergence in order to come up with a better and more acceptable solution.

"Integrity, credibility and competency are the key success factors in developing the Shariah framework and governance. Albeit divergences of Shariah rulings, there should not be a major issue so long as they are backed by sound arguments and recognised legal methodologies," he said.

Muhyiddin, who is also Education Minister, also pointed out that shortage of qualified experts in Islamic finance was the constraining factor for the innovation of new products and services in most countries.

"Therefore, investment in developing the key resources of the industry must be further enhanced. Heightened market awareness of the huge potential that Islamic finance offers is also urgently needed, and this can be done through research, education and training," he said.

INCIEF, which produces high-calibre practitioners and professionals in Islamic finance as well as specialists and researchers in the disciplines of Islamic finance, has so far enrolled 2,224 students from 83 countries as at July 2013, he said.

Muhyiddin reminded Islamic banks to not be complacent and continuously strive to be the best banking system in order to attract the public, Muslims and non-Muslims alike.

"To remain relevant, Islamic banking must be robust and resilient and should continuously reposition itself if it desires the respect and recognition from the rest of the world," said the deputy minister.

KLIFF 2013, which is a two-day conference, saw about 400 delegates comprising industry players, policy makers as well as academics.

(National News Agency Of Malaysia / 24 Sept 2013)

---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Malaysia: Waqf Is Missing Piece In Islamic Financial System, Says CIMB Islamic

KUALA LUMPUR, Sept 24 (Bernama) -- Waqf (Wakaf) is the missing piece in Malaysia's Islamic financial system despite the country being the market leader with various sophisticated products and services.

CIMB Islamic Bank Chief Executive Officer Badlisyah Abd Ghani said: "Malaysia has from the simplest saving products to sukuk as well as many different sophisticated products for institutional investors, corporate clients, small medium entrepreneurs and individuals.

"(But) what is missing in the market today is waqf in a commercial manner," he told reporters on the sidelines of the 10th Kuala Lumpur Islamic Finance Forum (KLIFF 2013) here today.

Waqf is an Islamic endowment of property to be held in trust for religious or charitable purposes.

Badlisyah said to have waqf in the financial market, there is a need for a conducive legal framework that will allow for its incorporation in an effective manner.

"If we have it, over time, waqf could be the bigger component of the Islamic financial market, as what was in the golden era of Islamic civilisation in the past," he added.

Badlisyah said in order to have that legal framework, there is a need for dialogues between the federal and state governments as the laws concerning waqf are currently under the jurisdiction of the state Islamic religious councils.

In his opening speech, he said the current legal framework for waqf does not allow for the proliferation of waqf across all areas of economy.

In the afternoon session, Badlisyah called on the government to provide incentives in the upcoming Budget 2014 to encourage industry players to list sukuk on Bursa Malaysia, a move which would further enhance the sukuk market.

"Of course, this need to be reviewed and studied by Bursa Malaysia and Securities Commission in terms of its viability but at the end of the day, it does create a good communication to the rest of the world that the market in Malaysia is significant because it is in the public domain," he said.

Badlisyah said, for example, on the London Stock Exchange, they have a few billion dollars worth of sukuk listed on the exchange and as a result, they claimed they are one of the largest sukuk markets in the world, despite some of these sukuk were issued outside London.

"It is the same in Malaysia. We already have the largest number of sukuk in the world, but it is just not listed and not in the public domain," he said.

With the listing of sukuk, overtime, it would encourage more trading of sukuk by individuals and the price discovery is also better as it is publicly available, resulting in a more vibrant sukuk market.

(National News Agency Of Malaysia / 24 Sept 2013)

---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Malaysia wants Islamic finance industry to ‘look West’

PETALING JAYA: With the backing of Maybank Islamic Bhd, the World Islamic Economic Foundation (WIEF) is working together with the Greater London Authority to boost trade and investment between Malaysia, the Association of South-East Asian Nations (Asean) and the UK.

The idea is based on the consensus of using Islamic finance as the platform for the transactions that will involve Malaysian investors and businesses in their efforts to diversify their portfolios into the UK, particularly in London, Maybank Islamic chief executive officer Muzaffar Hisham said last week in Kuala Lumpur.

“There is an increasing interest by Malaysian investors in diversifying their investment portfolios into the UK and particularly London. Maybank Islamic is well placed to encourage such opportunities”, Muzaffar said.

Muzaffar emphasised on the strategic importance of Islamic Finance for London as an opportunity to tap into a new source of capital, assets and liquidity in Islamic markets for London’s future growth and global ambitions.

Muzaffar has not only encouraged sovereigns but also UK corporate firms that are wishing to issue funds to consider Shariah-compliant instruments as they expand to new frontiers, especially in the Gulf Cooperation Council (GCC) and Asean/Malaysia.

“The deal will most probably be announced during the 9th WIEF in London in October,” Muzaffar told reporters after the soft launch of its new retail mortgage product at the WIEF headquarter in Kuala Lumpur.

Maybank Islamic has recently secured pound sterling cross border financing, making it the first Malaysian bank to have such financing instruments in London, Bernama reported.

Also present during the event were deputy mayor of London Sir Edward Lister and WIEF managing director Syed Abu Bakar Almohdzar, who both reiterated the importance of boosting trade, investments and business between Malaysia, Asean and London through Islamic Finance.

“Developing trade and investment links with Malaysia is a key priority for London and Maybank’s initiative significantly broadens the range of Shariah-compliant investment opportunities. Hosting the world,” Lister said.

The WIEF will showcase London’s role as the leading Western hub for Islamic Finance and lay the foundation for strengthening our bond with the Islamic world, Lister added.

London has taken proactive measures to grow Islamic Finance in an attempt to attract more investment from the Middle East and other Muslim countries in the Asean region, believing these are essential to further boost London’s standing as an important centre for the industry.

There is a growing appetite for Shariah-compliant investments in London as it grows in Malaysia and Asean, the Maybank Islamic feels that it is well placed to bridge prospective clients in facilitating their aspirations.

In addition, Maybank Islamic is also actively expanding its foreign currency business in the retail banking space.

The bank is in the final stage of launching an Islamic foreign currency property financing product for London properties due to be launched in fourthquarter of 2013.

On the other hand, Syed Abu Bakar said Malaysia will continue to play a leading role in Islamic finance, through the WIEF, with London as a new global centerpoint.

“As Malaysia continues to play a leading role in Islamic finance, the World Islamic Economic Forum continues to be a strong advocate of Islamic Finance in Muslim and non-Muslim communities around the world,” Syed Abu Bakar said.

(F.M.T News / 23 Sept 2013)

---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Telekom Malaysia’s (TM) proposed RM3bil Sukuk gets favourable RAM ratings

KUALA LUMPUR: RAM Ratings has given the AAA/Stable/P1 ratings to Telekom Malaysia’s (TM) proposed Sukuk Wakalah Programmes with a nominal value of up to RM3bil.

According to RAM, a plus factor in its assessment was the high likelihood of “extraordinary government support” for TM, given the Malaysian Government’s 68.6% share in the group, ownership of a special rights redeemable preference share and 33% representation on the board.

It said TM’s ratings were also anchored by its dominant position in the domestic fixed-line telephony sector, as well as its strong position in the fixed-broadband market with 89% of subscriber base.

“The group’s ratings are also supported by its healthy financial profile, which is characterised by stable earnings, a steady cash flow-generating ability and moderate balance sheet.

TM’s proposed Sukuk will comprise the Islamic Commercial Papers Programme (commencing in 2013 and maturing in 2020) and the Islamic Medium-Term Notes Programme (2013/2033).

(The Star Online / 06 Sept 2013)

---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Strong Malaysian capital market seen, SC says Malaysia has good fund-raising track record

KUALA LUMPUR: The local capital market is expected to be “reasonably strong” based on the pipeline of capital raising, Securities Commission (SC) chairman Datuk Ranjit Ajit Singh said.

“We are not targeting any specific number but we have said (based on projections) that the capital raising figures for the local (market) are reasonable. However, it would depend on how the market condition would pan out for the rest of the year,” he told reporters after delivering a public lecture on Islamic Wealth Management co-organised by BNP Paribas Malaysia Bhd and the International Centre for Education in Islamic Finance.

He said Malaysia had a fairly successful fund-raising track record for the last few years. Notably, RM146bil was raised from the Malaysian market last year, of which RM124bil was through the bonds market and RM22bil through the equities market.

Ranjit also said the regulator was targetting to position the country as an Islamic wealth management centre, following Malaysia’s success in other areas of Islamic financial services such as Islamic banking, sukuk and takaful.

“Malaysia has a large pool of savings worth some RM1 trillion. The challenge we have is to ensure that some of these pools of savings are intermediated through the capital markets, so that you create scales in terms of those intermediaries to address Malaysians’ needs, and then to position yourself outside,” he said.

One of the strategies was for foreign asset management units to enter the country, he said, adding that the regulator had issued 19 licences to Islamic fund management firms to-date.

He pointed out that such companies got to enjoy tax incentives.

According to Ranjit, of the US$25 trillion (RM82 trillion) worth of mutual funds in the world, the demand for Islamic funds was only US$60bil to US$70bil (RM197bil to RM230bil), which showed that there was still lack of demand for the product, prompting him to urge fund managers to participate in Islamic fund management to create more awareness.

Notably, Malaysia was home to the world’s largest unit trust industry, with 169 Syariah-compliant funds, he said.

Assets under management (AUM) for Islamic funds stood at approximately RM80bil last year, up RM32bil or 66.7% from RM48bil in 2010, he added.

He also said the RM80bil represented about 16% of the total funds industry.

“By 2020, the SC has projected the Islamic fund management industry’s AUM to expand to RM322bil,” he said.

(The Star Online / 05 Sept 2013)

---
Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com