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Thursday, 29 August 2019

Islamic finance is alive and kicking in Malaysia, says BNM Governor

BERNAMA (29 August 2019)

KUALA LUMPUR (Aug 29): Malaysia’s Islamic banking industry is not phasing out of the limelight but is very much alive and kicking, gaining maturity and poised for further growth.
This is evident from statistics which shows that Islamic financing currently accounted for 34.1% of total financing (2008: 14.9%) while Islamic banking assets stood at 31.4% against a meagre 14% in 2008.
Going forward, further development of Islamic finance will increasingly be industry-driven.
“Islamic banking is not slowing down; rather, it has been growing. The industry is propelling growth on its own, penetrating new markets and increasing market share,” said Bank Negara Governor Datuk Nor Shamsiah Mohd Yunus in an exclusive interview with Bernama recently.
In response to comments of late that there was a lack of really solid development and momentum in driving Islamic finance, she reiterated that the industry not only continues to record healthy growth but is integrating social-finance in its product offerings.
This is to leverage the strengths of Islamic banking for greater accessibility, governance and transparency.
“So, there is a lot of merits to ‘marry’ or merge these two. In Islam, we have ‘sedekah’ (voluntary charity) and zakat. Islamic banking can help intermediate these contributions to promote socio-economic development in the country,” she said.
By leveraging on Islamic banking and socio-finance, some of the product offerings such as sedekah, wakaf and zakat can be used to improve the livelihood of the marginalised or underserved groups, she pointed out.
In future, development initiatives for Islamic finance will focus on quality growth and value adding to improving the livelihood of the people.
RAM Rating Services, in its latest edition of the “Islamic Banking Insight” publication released recently, said the Islamic banking sector was expected to grow between 10% and 11% this year, which is pretty much the same as the growth rate achieved in 2018.
The local rating agency said Islamic banking continued to expand at a much faster pace than conventional loans last year, coming in at 11% compared with the latter’s 3.3% growth. It grew at 10.3% in 2017.
For 2019, RAM is maintaining a stable outlook for the Malaysian Islamic banking sector in line with its positive view of the overall domestic banking system.

Tuesday, 27 August 2019

Malaysian government sets up special committee on Islamic Finance

BERNAMA (27.8.2019)

PUTRAJAYA, Aug 27  -- The Ministry of Finance (MoF) has announced the establishment a Special Committee on Islamic Finance (JKKI) to promote and encourage development of Islamic Finance.

The committee, chaired by Deputy Finance Minister Datuk Amiruddin Hamzah, comprises nine regulators and Islamic finance experts, MoF said in a statement today.
The setting up of JKKI, first announced in Finance Minister Lim Guan Eng's 2019 Budget speech, is aimed at firming up the direction for promoting Malaysia as a global leader in Islamic finance, especially in the sukuk market.

"It is also to strengthen efforts towards turning Malaysia into a centre of excellence in Islamic finance as well as a leading provider of support services for Islamic finance globally,” it said. 

JKKI would coordinate the roles and responsibilities of stakeholders to enhance the Islamic finance industry in Malaysia while strengthening the public sector's role as the driving force in the industry and promoting efforts to increase public awareness in Islamic finance, MoF said.

Committee members include Datuk Dr Mohd Daud Bakar, chairman of Bank Negara Malaysia's (BNM) Shariah Advisory Council and the Securities Commission (SC) as well as president of the International Islamic University of Malaysia.

Other members are Association of Islamic Banking and Financial Institutions Malaysia president and RHB Islamic Bank managing director Datuk Adissadikin Ali, Maybank Islamic Bhd chief executive officer and Islamic Banking and Finance Institute Malaysia chairman Datuk Mohd Rafique Merican Mohd Wahiduddin Merican, Employees Provident Fund syariah committee member Dr Zaharuddin Abd Rahman, Majlis Amanah Rakyat chairman Hasnita Datuk Hashim, SC deputy director (Islamic capital market development) Dr Md Nurdin Ngadimon, BNM director of Islamic banking and takaful department Madelena Mohamed, Islamic Development Department of Malaysia director-general Datuk Mohamad Nordin Ibrahim, Malaysian Takaful Association president and Sun Life Malaysia Takaful Bhd chief executive officer Muhammad Fikri Mohamad Rawi.
MoF's strategic investment division serves as JKKI's secretariat.
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