Latest from GIFC

Wednesday, 7 November 2007

HSBC says wins Malaysian Islamic bank licence

KUALA LUMPUR, Nov 7 (Reuters) - Global bank HSBC Holdings said on Wednesday it has won a licence to set up a standalone Islamic bank in Malaysia, in a move that could speed up the expansion of its local branch network.
Foreign banks are kept on a tight rein by Malaysia's central bank, which allows them to open only a few branches each year.
But standalone Islamic banks are treated as separate banks, with their own boards and balance sheets. HSBC is the first foreign bank in Malaysia to get an Islamic subsidiary licence.
"HSBC Amanah Malaysia will establish a dedicated network of Islamic branches in line with (central bank) guidelines," HSBC Malaysia said in answer to emailed questions about the licence.
"HSBC Amanah Malaysia will be able to service conventional customers, however, it cannot cross-sell conventional products through the Islamic network," it added.
Under Islamic or shariah law, interest is forbidden and Islamic banks instead offer finance that is more like equity or a rental agreement. Bank deposits pay a profit, not interest.
Malaysia, home to the world's largest Islamic bond market, aims to become an international hub for Islamic finance and has been encouraging local and foreign banks to put their Islamic banking businesses under standalone subsidiaries.
The future of foreign branch networks is a sensitive issue in Malaysia, where authorities have been reluctant to expose the domestic bank sector to a rapid increase in foreign competition until the local banks are in a better position to cope.
Foreign banks such as Citibank HSBC and Standard Chartered have captured a big chunk of consumer lending with just a few branches. Citi has seven branches yet around 8 percent of mortgages and a fifth of the credit-card market.

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

No comments:

Upcoming Events on Islamic Finance, Wealth Management, Business, Management, Motivational Alfalah Consulting, KL-Malaysia: www.alfalahconsulting.com

ISLAMIC FINANCE EVENTS KUALA LUMPUR MALAYSIA

ISLAMIC FINANCE EVENTS KUALA LUMPUR MALAYSIA
Register Online . Register Today

Islamic Financial Planning & Wealth Management by Ahmad Sanusi Husain