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Bourse to launch commodity Murabahah product: Bursa Malaysia planned to launch two products, to be developed in the first quarter of 2009. The first product will be the Palm Oil-based Commodity Murabahah (POCM) — the first of its kind in Malaysia. The Murabahah received strong support from producers, who had committed around RM600 million (US$184 million) worth of crude palm oil to be used as the underlying commodity in this initiative. The amount was expected to reach RM1 billion (US$306 million) by December.
UOB signs agreement with as-Salihin: United Overseas Bank (UOB) (Malaysia) signed an agreement with as-Salihin Trustee to offer Islamic estate planning services to Muslim customers. The range of services offered would include will writing, estate administration and trusteeship provided by as-Salihin.
Alliance signs MoU with Okachi: Okachi Malaysia was appointed as the commodity trader of Alliance Islamic Bank’s new fixed deposit product, Alliance Fixed Investment-i (AFI). The product was the first in Malaysia to use commodities traded on the Tokyo Grain Exchange and Central Japan Commodity Exchange for deposit placement, said the bank’s CEO, Yahya Ibrahim.
Investors needed for Islamic hospital: The Kedah state government began its search for private investors to build an Islamic hospital in the state. State chief minister Azizan Abdul Razak said Kuwait Finance House had expressed its interest. It was also keen on working with the Kedah government in developing the agriculture segment, he added.
PLUS looks to raise US$300 million: PLUS SPV, the special purpose vehicle (SPV) of toll road operator PLUS Expressways, sought to raise RM1 billion (US$306 million) via Sukuk. This formed part of its RM4 billion (US$1.25 billion) Islamic medium-term note program and would be Musharakah-structured. The lead arranger was CIMB Investment Bank while CIMB and Bank Islam were the joint book runners.
The Islamic bond was to come in seven tranches with tenors from five to 11 years, and with a 2% coupon. PLUS SPV had the option to upsize the offering.
CIMB increases fund size to 1.35 billion units: The fund size of CIMB-Principal Asset Management’s CIMB Islamic DALI Equity Theme Fund was increased from 900 million units to 1.35 billion units. This marked the second time the fund size had been increased from an initial 600 million units since its launch in March.
Ninety-eight per cent of the fund’s net asset value would be invested in Shariah compliant equities listed on Bursa Malaysia.
TAIM expects 12% annual return: TA Investment Management (TAIM) expected its Shariah compliant trust fund, TA Dana Fokus, to give investors a 12% annual return. The fund aimed to tap the Malaysian stock market with a concentrated equities portfolio, said Choo Swee Kee, TAIM’s chief investment officer.
Zico establishes Islamic arm: Zaid Ibrahim & Co (Zico) formed an affiliate company, ZI Shariah Advisory Services, to provide legal and advisory services on Islamic law to local and international clients. The only such establishment in Malaysia, it had also been endorsed by Securities Commission Malaysia as the Shariah adviser for Sukuk issuances.
QIB signs MoU with Gulf Petroleum: Qatar Islamic Bank (QIB) and its affiliate Asian Finance Bank signed a memorandum of understanding with the Malaysian subsidiary of Qatar-based Gulf Petroleum to study the possibility of financing an oil and gas complex in the Malaysian state of Perak.
Kenanga to raise funds for power project: The Dubai unit of K&N Kenanga, MeNA Financial Group, was given the mandate to raise funds for a US$5 billion power project in Southeast Asia by Malaysia-based Transpower Energy Ventures.
Faisal Bank to use Malaysia as launch pad: Faisal Private Bank favored Malaysia to establish itself in the Southeast Asian region in the Islamic private banking market. Its investment banking head, Giovanni Perin, confirmed the opening of a representative office in the coming months, as a platform to enter markets such as Singapore and Indonesia.
Bank Muamalat launches products: Bank Muamalat launched its Muamalat General Investment Account (GIA) and ONEReach Savings Account-i. It expected to collect between RM300 million (US$92 million) and RM500 million (US$153 million) in deposits. The account’s four-month deposit drive began in early June.
IFSB, IIF co-organize conference: Bank Negara Malaysia is set to play host to a conference themed “Enhancing the Resilience and Stability of the Islamic Financial System”, co-organized by the Islamic Financial Services Board and the Institute of International Finance.
Islamic stocks on the rise: Securities Commission Malaysia (SC) reported an additional 23 Shariah compliant stocks were listed on Malaysia’s stock exchange. The stocks included top mobile-phone company TM International and energy company Dayang Enterprise. The market regulator said the listing, which took effect on the 30th May, accounted for 85% of the securities listed on Bursa Malaysia.
KFHM concludes deal: Kuwait Finance House Malaysia (KFHM) closed a deal for financing a biogas green power project with the Bell Group of Companies, the first local renewable energy project developer, to capture waste by-products and convert them into green energy that would be linked to the national electricity grid.
Enhancement for IDB: The Islamic Development Bank (IDB) needs to be repositioned and exploit the current subprime crisis to further develop Islamic finance and capital markets, said Ahmad Husni Mohamad Hanadzlah, Malaysia’s deputy finance minister.
He advised the bank to take advantage of the fact that investors were shying away from complicated products, preferring the more transparent and secured ones available under Shariah compliant finance.
INCEIF, ICMA sign agreement: The International Center for Education in Islamic Finance (INCEIF) and the ICMA Center signed an agreement to offer a Master of Science in Investment Banking and Islamic Finance program at the ICMA Center in the University of Reading.
Islamic debit card launched: EONCAP Islamic Bank launched its Shariah compliant debit card. CEO and executive director Fozia Amanulla said the bank intended to issue up to 70,000 cards within a year. Because of its Islamic nature, the card could not be used to purchase alcohol or for gambling purposes.
MRCB Southern Link proposes Sukuk: MRCB Southern Link planned to issue RM845 million (US$258.33 million) secured senior Sukuk and RM199 million (US$60.83 million) junior Sukuk. Funds raised would be used to develop the proposed Eastern Dispersal Link Expressway (EDL) toll-road project.
The proposed senior and junior Sukuk were assigned ratings of “AA3” and “A2” respectively by RAM Ratings.
TAKAFUL
Takaful Malaysia denies privatization plan: Takaful Malaysia denied the finalization of any plans involving the firm’s privatization. The statement was in response to a query by Bursa Malaysia after a news report in June, which stated that Takaful Malaysia would be privatized.
Takaful Malaysia, however, affirmed discussions on a proposed strategic alliance with “relevant parties”, with its outcome to be announced in due course.
The statement was in light of Bank Negara Malaysia’s go-ahead to Takaful Malaysia to discuss partnership opportunities with Abu Dhabi-Kuwait-Malaysia Strategic Investment Corp and SALAMA.
Gross distribution for stakeholders: MAAKL Mutual announced a 6.74% yield for the MAAKL Al-Umran fund for the financial year ended the 31st May 2008. CEO Wong Boon Choy said the gross distribution per unit for the fund was RM0.02 (US$0.006).
The Shariah compliant MAAKL Al-Umran fund sought a balance between equities and bonds to maximize income, he added. The distribution was for unit holders who had maintained their stake in the fund at the end of the financial year period.
MNRB pumps in US$6.17 million: Takaful Ikhlas received a capital boost amounting to RM20 million (US$6.17 million) from parent company, MNRB Holdings, thereby increasing the paid-up capital to RM195 million (US$60 million).
“This will give us sufficient basic capital to continue with our expansion strategies,” said the CEO of Takaful Ikhlas, Syed Moheeb Syed Kamarulzaman.
At the time, the Islamic insurance company had launched more than 77 family and general Takaful products for individual and group customers, which totaled more than 600,000 policyholders.
Etiqa to educate in cyberspace: Etiqa Takaful is focusing on cyber communities to grow its local Takaful penetration, be it consumers or agents. Vice-president Izzudin Shah Othman said Etiqa was working with the energy, water and communications ministry to establish a community center in cyberspace to educate the public on Takaful products.
Etiqa was offering general insurance products online such as personal accident, motor and travel, but will offer a wider range once the cyber community is in place.
“We will try to move to life products eventually, but they are more complicated and we need to emphasize on educating the cyber community first,” he said.
PruBSN aims for growth: Prudential BSN Takaful (PruBSN) aimed to grow its contribution by 40% in 2008 from the RM150 million (US$45 million) it collected in its first year of operations. The company, launched in August 2006, had so far garnered RM288 million (US$86.2 million) in contributions.
CEO Mohammad Salihuddin Ahmad was confident that the company would maintain its pole position in new business contributions, noting the large room for growth due to the low take-up rate of 7.7% by Muslims, compared with 40% for conventional life products.
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