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Thursday, 20 September 2007

BNM Eyes Islamic Financing Products For Construction Sector

KUALA LUMPUR, Sept 19 (Bernama) -- Bank Negara Malaysia (BNM), in consultation with the Master Builders Association Malaysia (MBAM), aims to come up a guideline on Islamic financing products for the construction sector.MBAM president, Patrick Wong, said BNM's move to promote Islamic financing for the construction sector was good and would give the industry a boost."The association is expected to hold further discussions with BNM today," he told reporters at the International Construction Conference 2007 here Wednesday.Early this month, BNM said international Islamic banks under the Malaysian International Islamic Financial Centre initiative, would be allowed to offer Islamic banking services for non-residents in local and foreign currencies."The advantage of Islamic financing to the industry players is that the cost of fund is capped and it offers easier repayment as it is not an interest-centred funding. It is more a profit-sharing funding," he said.Wong said Islamic banking was good for the construction players because it capped the cost and the risks were much lower."We are optimistic of the move because BNM invited us to get our views and feedback on how it can formulate certain Islamic financing products to be introduced to the construction sector," Wong said, when asked on the association's expectations at the meeting today.On whether the financing was for both local and overseas projects, Wong said: "We don't know whether we will talk about overseas or not, but I think it is more local at this moment. But once BNM takes the lead, then this can be recognised everywhere in the world." - (Bernama, 19 Sep 07)

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