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FTSE introduces Shariah series: FTSE hosted a luncheon in Kuala Lumpur to introduce the FTSE Shariah Global Equity Index Series to Malaysian Islamic product issuers. Those presenting were Majid Dawood, CEO of Yasaar; Dr Mohd Daud Bakar, who sits on the Yasaar Shariah Board, and Charlene Low, senior sales manager for Asia-Pacific, FTSE.
Cagamas Sukuk debut: Cagamas issued its first Sukuk via its Islamic financing facility arrangement with Bank Kerjasama Rakyat Malaysia in March. Under the agreement, the range of asset classes that could be sold or transferred to Cagamas would be expanded to its personal financing I-Aslah and pawnbroking ArRahnu/Az-Zahab businesses.
Bank Islam’s first advisory deal: Bank Islam Malaysia secured its first corporate advisory deal, a mandatory takeover offer by Akarmas for PK Resources worth RM37 million (US$10.73 million).
SC geared to develop markets: The Securities Commission Malaysia (SC) planned to undertake three new initiatives in the development of the Islamic capital market, said its chairman, Zarinah Anwar. The first step was via the formation of an international advisory committee, which would provide guidance on matters related to the ICM. The second was to have two ICM forums a year while the third was to solidify partnerships.
Muhibbah Sukuk: Malaysian builder Muhibbah Engineering expressed its intention to sell up to RM400 million (US$116 million) in Sukuk. The proceeds would be used to finance working capital commitments.
Third rating agency approved: Malaysian Rating Corporation (MARC) and Rating Agency Malaysia would soon be joined by a third rating agency, which would be allowed to have 49% international share. It was reported that Moody’s Investors Service was in the running to be the third agency’s international partner.
Tabung Haji goes low risk for the long term: Lembaga Tabung Haji aimed to strengthen its financial position by investing in the low-risk, long-term returns sector. At the time, 67% of Tabung Haji’s earnings were derived from stock market investments.
The recovery of the US and European economies had also changed global market sentiment, allowing Tabung Haji to take a closer look at the investment trends.
Forum on opportunities in Labuan: A forum on investment opportunities in Labuan International Business & Financial Centre (Labuan IBFC) was held in Dubai. Panel members from Labuan IBFC presented investment opportunities on a comprehensive range of products and services such as offshore company registration, Islamic banking, leasing, Takaful and reTakaful products, Islamic capital market, fund management, Islamic trust administration and the Labuan International Financial Exchange.
Islamic money market fund makes debut: CIMB-Principal Asset Management launched the CIMB Islamic Money Market Fund, a Shariah compliant fund that invests in short-term money market instruments maturing in less than a year. As a tax-efficient alternative to traditional bank deposits, the fund sought to provide potentially higher returns and allowed investors to withdraw their cash anytime without penalty.
StanChart receives Islamic license: Standard Chartered Bank Malaysia received approval for its application to set up a stand-alone Islamic banking license to expand its Islamic banking business. Despite the bank’s focus on attaining organic growth, it was open to merger and acquisition opportunities.
Bourse expects Mideast listings: Bursa Malaysia expected its first listing by a foreign company this year, and Middle Eastern firms were among the top candidates, said Bursa Malaysia CEO Yusli Mohamed Yusoff. According to him, one company that had approached the exchange was already listed in Iran.
Litrak mulls debt refinancing plan: Lingkaran Trans Kota Holdings (Litrak) mulled the possibility of returning RM1 (US$0.31) per share through a capital repayment exercise after it refinanced existing debts to free up more cash flow for shareholders.
Analysts said the proceeds from the Sukuk issue would fully retire Litrak’s existing debts that were taken to fund the construction of the Damansara-Puchong Expressway. Given the strong traffic flow at the LDP, the Sukuk bond issue would allow Litrak to extend the repayment tenure of its debts, while freeing up more immediate cash flow for shareholders.
Telekom to retain control of mobile unit: Telekom Malaysia would retain control of its wireless business in any stake sale, dimming the appeal for potential buyers including Orascom Telecom Holding, reported a newswire. Insisting on control might hamper Telekom’s ability to reap a premium for the business, which it estimated to be worth RM28 billion (US$8.7 billion).
Orascom, the biggest mobile carrier in the Middle East and North Africa by users, said it was interested in bidding for joint control of Telekom.
Swiss-based Islamic bank headed for KL: Switzerland’s only Islamic private bank, Faisal Private Bank, announced plans to set up its first overseas office in Malaysia. Fadhil Mansor, who was tipped to head the Kuala Lumpur office, said Swiss Federal Banking had approved the formation.
IDB’s MTN plans: Jeddah-based Islamic Development Bank planned to set up a RM1 billion (US$314 million) medium-term note (MTN) program, followed by the issuance of up to RM500 million (US$157 million) worth of Sukuk. This would be the third Sukuk issued by IDB, but the first denominated in a local currency.
TA Investment mulls Shariah funds: TA Investment Management revealed plans to introduce Shariah compliant and specialized funds to add to the 14 funds available, said chief investment officer Choo Swee Kee. Choo expected the market to pick up by mid-year, despite decreasing economic activities
in the US.
BNM forms research-based institute: Bank Negara Malaysia formed the International Shariah Research Academy for Islamic Finance (ISRA), which would be attached to the International Center for Education in Islamic Finance (INCEIF).
HLIB to arrange Sarawak Energy Sukuk: Hong Leong Islamic Bank (HLIB) won a deal to arrange a RM3 billion (US$949 million) Sukuk sale for Sarawak Energy, beating 13 other contenders, said HLIB managing director Khalid Mahmood Bhaimia. The Sarawak state electricity producer and distributor planned to use the money to finance the construction of a 900MW hydropower plant in Murum.
Khazanah Sukuk listed on LFX: Labuan International Financial Exchange listed its third exchangeable Sukuk by Khazanah Nasional. The US$550 million exchangeable trust certificates were issued via its Labuan incorporated special purpose vehicle, Paka Capital.
The Sukuk, due in 2013, was exchangeable into ordinary shares of Parkson Retail Group (Parkson), a company listed on the Hong Kong Stock Exchange and the largest department store operator in the People’s Republic of China.
TAKAFUL
Takaful Ikhlas targets US$3 million: Takaful Ikhlas expressed confidence in achieving a collection of more than RM10 million (US$3.14 million) through the strategic business partnership it had formed with Bank Muamalat Malaysia, said Takaful Ikhlas president Syed Moheeb Syed Kamarulzaman.
Takaful Ikhlas would provide the Takaful scheme for the Al-Istisna financing program and Ijarah financing program for Bank Muamalat. Bank Muamalat expected to offer the IKHLAS Comprehensive Perils plan, IKHLAS Fire Takaful, IKHLAS Marine Takaful, Workers Compensation and Contractors’ Risks.
MAA in talks with AmAssurance: Following approval from Bank Negara Malaysia, MAA Holdings began negotiations on the sale of a stake in its Takaful insurance business (MAA Takaful) with Malaysian lender AMMB Holdings, via its AmAssurance unit.
Apart from MAA Takaful, MAA also offered to sell a stake in its wholly owned insurance subsidiary, MAA Assurance Alliance.
Munich Re to make Malaysia global hub: German-based Munich Re is planning to penetrate the reTakaful market in Islamic countries in the Middle East and Asia. According to director Ludger Arnoldussen, the world’s second-biggest insurance company hopes that within five years, it will dominate up to 20% of the global reinsurance market.
He also said that Munich Re has chosen Kuala Lumpur as the sector’s main hub.
In a related report, CEO Ludwig Stiftl said the company has established their operations in Malaysia with a working capital of RM25 million (US$8 million). He also revealed that it was in talks with eight Malaysian companies to offer Munich Re’s general and reTakaful products. The group plans to widen the manpower within the Malaysian base.
Munich Re, whose local partner is MNRB Holdings, was the first international Takaful reinsurer to operate in Malaysia.
HLB targets premiums: Hong Leong Bank anticipated a good response to its bancassurance product, Hong Leong Cancer Protection Plan (HLCPP).
HLCPP provides continuous cover for cancer from the point of diagnosis in the early stage up to the advanced stage.
The protection plan offers 300% of the sum assured against cancer and 100% of the sum assured against death and permanent disability.
The group was targeting RM250 million (US$79 million) in conventional and Takaful
insurance premiums this year.
HLTMT Gulf Opportunities Plan: Hong Leong Tokio Marine Takaful (HLTM Takaful) became the first Takaful operator to launch a fully Shariah compliant Takaful plan linked to investment opportunities in the Middle East, utilizing the concepts of Wa’ad and Commodity Murabahah.
The plan, known as HLTMT Gulf Opportunities Plan (GOP), was its second Capital Protection Investment-Linked (CPIL) plan.
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