Malaysia

Exclusive - #Malaysia's Maybank prepares to spin off and list #insurance unit: sources

Malayan Banking (Maybank) is preparing to spin off and list its Etiqa insurance arm on the local stock exchange. Etiqa operates in Malaysia, Singapore, the Philippines and Indonesia and is estimated to be worth at least $1 billion. As part of the transaction, Maybank’s investors are expected to receive shares in the insurance company in proportion to their existing holding in the bank. Etiqa provides life and general insurance as well as family and general takaful. In 2017 Eitqa reported a record revenue of 6.2 billion ringgit ($1.6 billion). Profit before tax rose 18.5% to 1 billion ringgit last year. In March, Etiqa said it maintained its top position in Malaysia’s general insurance and general takaful segment with an 11.8% market share. It was ranked fourth in the life and family segment, with an 8.9% market share.

MBSB starts afresh as a full-fledged Islamic bank

MBSB Bank, the result of a merger between Malaysia Building Society and Asian Finance Bank, starts afresh as a full-fledged Islamic bank. According to group CEO Datuk Seri Ahmad Zaini Othman, the bank intends to differentiate itself in the area of transactional banking, as well as in digital capabilities. One of the key targets in MBSB Bank’s three-year business plan is to have fee-based income account for at least 25% of its total income by the end of 2020. The bank hopes that its approach towards customers will also set it apart from other lenders. MBSB Bank is starting out with total assets of RM43.7 billion, making it the second largest standalone Islamic bank after Bank Islam Malaysia (RM57.7 billion). Personal financing constitutes the biggest portion of the bank's gross financing and is extended mainly to civil servants. MBSB plans to make a stronger push in the industrial hire purchase segment, which involves SME financing. Zaini plans to offer a lot more products and services for SMEs, especially in the area of current accounts.

Allianz still keen to acquire #takaful business

Despite a failed merger with HSBC Amanah Takaful a year ago, Allianz Malaysia is still keen to acquire a takaful business. According to Allianz CEO Zakri Khir, there is bright takaful business growth potential because the penetration rate in Malaysia is just 15%. Allianz Malaysia has recently sealed a partnership with insuretech start-up PolicyStreet to offer potential clients to purchase insurance policies online. Four Allianz digital products will be offered on PolicyStreet’s digital platform namely Enhanced Road Warrior, Smart Home Cover, Allianz Travel Care and Allianz Flight Care. In 2017, Allianz Malaysia's profits fell 7.7% to RM287.96 million from RM312.13 million on the back of 2.6% rise in revenue from RM4.68 billion to RM4.8 billion. Zakri said Allianz Malaysia was impacted by Bank Negara's detariffication of motor and fire insurances from July 1 2017.

Maybank Islamic to grow trade financing biz

Malaysian Islamic banks are boosting their trade financing market share with various measures. Maybank Islamic CEO Mohamed Rafique Merican said the bank intended to grow its trade facilities in line with growing demand for Islamic finance in Malaysia. Mohamed Rafique was speaking to reporters after a forum on "Islamic Trade Finance: Revitalising Trade and Unlocking New Potential". He said a lot more could be done to boost Islamic trade facilities, which stood at 1.5% out of US$50 billion. RHB Islamic Bank CEO Datuk Adissadikin Ali said Islamic banks would need to collaborate with the financial technology players to provide e-commerce trade financing. He added that RHB Islamic Bank was developing an e-commerce trade financing platform to enable companies to boost their working capital and the platform was likely to be implemented next year.

#Malaysia can be Islamic #fintech leader, says Fitch Group unit

According to research agency BMI, Malaysia has the potential to be a world leader in Islamic financial technology (fintech). The research firm said Malaysia’s Islamic banking sector was worth US$202 billion last year, while its Islamic loans also more than doubled to 30.2% the same year, compared to just 7.8% a decade ago. BMI noted Malaysia has a developed infrastructure, an increasingly affluent and tech-savvy population, and high mobile and broadband penetration rates coupled with fast internet speeds. The Memorandum of Understanding between MIMOS and the International Center for Education In Islamic Finance (INCEIF) has laid down the foundation for the development of Islamic fintech in Malaysia.

#Malaysia remains lead in Islamic finance

Malaysia has great potential to broaden its market share and strengthen its leadership in Islamic finance. According to the latest report by the Malaysia International Islamic Financial Centre, Asia’s Islamic financial assets amounted to US$528.7 billion (RM2.05 trillion), or 26% of the world’s Shariah-compliant financial assets as at end-2017. Malaysia continued to be the main driver for both sukuk outstanding and issuance for the year, with a market share of 51% and 36.2% respectively as at end-2017. The country also led in the Islamic wealth management industry with US$28.3 billion (36.5% global share). It also ranked first in terms of number of funds with a total of 394 funds and 27.9% global share, followed by Pakistan with 147 funds and Indonesia with 143. In the banking sector, Malaysia ranked third globally after Iran and Saudi Arabia with a total Islamic banking assets of US$204.4 billion as at end-2017.

Syed Alwi is Agrobank’s new CEO

Agrobank has appointed Syed Alwi Mohamed Sultan as its new president and CEO. The appointment has received approval from Bank Negara Malaysia and the Ministry of Finance. Previously, he had held several senior management positions with various banks such as Bank Muamalat Malaysia, BNP Paribas, Standard Chartered Saadiq, The Islamic Bank of Asia and HL Bank Singapore. Syed Alwi has a bachelor’s degree in Accounting and a first-class master of business administration in Islamic finance from the International Islamic University of Malaysia. Agrobank became a full-fledged Islamic bank in 2015. It provides Shariah-compliant banking products and funding to cater for the halal food industry and agriculture-related activities.

Public Mutual launches e-Islamic flexi allocation #fund

Public Mutual has on Tuesday launched an e-series fund called Public e-Islamic Flexi Allocation Fund (PeIFAF). The fund's objective is to achieve capital growth over the medium to long-term by investing up to 98% of its net asset value in Shariah-compliant equities or sukuk. Public Mutual CEO Yeoh Kim Hong said PeIFAF has a flexible fund mandate that enables the fund managers to capitalise on investment opportunities. The minimum initial and additional investment amount is only RM100 and the sales charge is up to 3.75%. The initial issue price for PeIFAF is 25 sen per unit during the 21-day initial offer period from Tuesday to April 23. To coincide with the launch of this fund, it is holding a campaign during the initial offer period. The campaign offers 203 prizes. The grand prize is RM3,000 of money market fund units.

MBSB rebrands AFB as MBSB Bank

Malaysia Building Society Bhd (MBSB) has rebranded its recently acquired Asian Finance Bank Bhd (AFB) as MBSB Bank. MBSB Bank's CEO Datuk Seri Ahmad Zaini Othman said the bank would provide Shariah-compliant products and services, such as consumer banking, business banking and trade financing. He added that the bank would also focus on developing its financial technology capabilities to attract more customers. The lender has already embarked on several digitisation initiatives, including big data projects started in June 2017. MBSB Bank plans to launch its fintech capabilities for wealth management and trade facilities by the third quarter of this year, and to have Internet banking facilities ready by end-2018. MBSB finalised its acquisition of AFB in February for RM644.95 million with the latter becoming a wholly owned subsidiary of MBSB. With the transfer of all MBSB’s Shariah-compliant assets and liabilities to AFB, MBSB Bank is the second-largest full-fledged Islamic bank in the country.

#Malaysia central bank to launch revised #takaful operational framework

Bank Negara Malaysia (BNM) plans to revise its takaful operational framework. Governor Tan Sri Muhammad Ibrahim said the revised framework would be published for consultation before the middle of the year. He said it would strengthen the governance of takaful operators, including how takaful funds are managed, to further safeguard the interest of takaful participants. On the objective of 25% family takaful penetration by 2020, he said it was ambitious, but achievable. Muhammad noted that the industry was lagging in terms of migration to e-payments. He added that another area that is wide open for innovation was the integration of takaful with elements of waqf, sadaqah and zakat.

Bank Rakyat to continue Islamic Banker Programme for the second edition

Bank Rakyat has recently launched its second edition of the Islamic Banker Programme which aims to produce future leaders for the banking industry. The programme recently received recognition from the 26th World HRD Congress 2018 by winning three top awards: Innovation in Recruitment, Best Apprenticeship and Usage of Digital Media in Recruitment. Throughout the training period, each trainee will be assigned to a mentor from the senior management team. Initially, each trainee will go through a two-month training program before they undergo job rotation across the key business units within the Bank for 10 months. Then, they will be placed in a particular sector based on their respective strengths and interests for a year. At the end, their performance will be assessed before being offered permanent placement at Bank Rakyat. At the end of the two year internship, participants will also be awarded with the Chartered Professional in Islamic Finance (CPIF) certificate from the Chartered Institute of Islamic Finance Professionals (CIIF).

Project Ar-Rahn 2 listing oversubscribed

Muamalat Venture, a wholly owned subsidiary of Bank Muamalat Malaysia had a second listing on Malaysia's Investment Account Platform. The investment book was oversubscribed by more than 1.05 times on the first day of its listing. Project Ar-Rahn 2 is an investment in a share of aggregate capital contribution of Muamalat Venture under the musharakah joint venture with Permodalan Kelantan, in selected branches of Islamic pawn broking (Ar-Rahn) business activities. The investment of RM20 million in Project Ar-Rahn 2 is for a tenure of one year and expected to generate a return of 7% per annum for investors.

MIMOS and INCIEF sign MOU for collaboration in the area of Islamic #Fintech

A Memorandum of Understanding (MoU) was signed by Malaysia’s Applied Research and Development Centre MIMOS and the International Centre for Education in Islamic Finance (INCEIF), to develop a blueprint for an Islamic finance-based investment technology platform. The MOU was signed by INCEIF President Dato' Dr Azmi Omar and MIMOS President Ahmad Rizan Ibrahim. Under the MOU, the two institutions will collaborate in research and development, in particular the areas of Big Data Analytics, Deep Learning and Fintech. Further, INCEIF and MIMOS may also cooperate in field-testing, technology transfer and commercialisation of technological products.

'Waqf' can boost science

#Malaysia hosted a conference in which experts considered the relevance of waqf and how it could be engaged to alleviate poverty. In his keynote address, Sultan of Perak Sultan Nazrin Muizzuddin Shah explained that the concept of waqf preceded trusts and endowments. A donor endows a waqf with an asset and the waqf institution then spends its revenue in perpetuity on the fulfilment of public needs. The law governing waqf was borrowed by the English following the Crusades in the Holy Land. For example, Merton College at Oxford University was established with a financial endowment in 1264. This endowment has facilitated centuries of scholarship, learning and teaching. Sultan Nazrin highlighted the need for a better system for the governance of waqf. He believes that digital connectivity will open up new opportunities for innovative business models, as well as research and development-related investments, to unlock the full potential of waqf assets.

HADA Coin Announces Listing on F1Cryptos Exchange, Partner Michael Buchbinder Offers Full Interview

Pioneering blockchain-based Islamic bank HADA DBank announced that its Hada coin will be listed on cryptocurrency trading platform F1Cryptos, following their token sale. F1Cryptos will be the first exchange to list the Hada Coin token. According to F1Cryptos partner Michael Buchbinder, HADA DBank's business model brings value and just interaction with the customer. The bank plans on engaging the age demographic between 20-30 that seems to be embracing blockchain and cryptocurrencies. After Discovering HADA DBank it was clear to the F1Cryptos team that the two companies shared the same vision. With F1Cryptos previous history as an FX brokerage, they are experienced to access the potential of HADA DBank. Hada DBank determines to fuse blockchain technology with Islamic Banking Module. The Pre-ICO is currently live, with an ongoing flash sale for the first one million tokens going up for sale at 1ETH = 4,000 HADACoin.

Hada DBank: A Blockchain-Based Islamic Bank

#Malaysia-based HADA Dbank is set to bring Islamic banking principles to the blockchain ecosystem. Hada DBank follows Islamic Financial Laws prohibiting risky ventures, having a maximum Liability to Asset ratio of 1:3. The bank allows users to have access to a full-feature personal banking service. This includes a free encrypted account and e-Wallet, a zero-fee charge on cryptocurrency exchanges and access to the financial advisor robot HUDA. Hada DBank will soon host a token generation event to raise funds for the full development of products and services. The native HADACoin will be a digital asset based on the Ethereum platform. HADACoin will be sold during the pre-sale at an increased rate adjusting to supply, starting at a rate of 1 ETH = 2000 for the first 10 million tokens, gradually reducing every 10 million tokens. Once the Hada DBank platform launches, HADACoin will be trading on the F1Cryptos exchange the first of many exchange platform partnerships in the pipeline.

Malaysian firm adds Islamic certification to #cryptocurrency

#Malaysia-based firm HelloGold has received a Syariah-compliant certification for its gold-backed cryptocurrency and plans to launch its online gold platform in Thailand. HelloGold's chief marketing officer Manuel Ho said the cryptocurrency product was named GOLDX and received certification from Amanie Advisors. GOLDX involves the issuance of a token backed by physical gold stored in a Singapore vault and transactions must be completed within a defined time period. Over the past year, the firm has also rolled out a mobile app in Malaysia that is based on blockchain. The mobile app, which allows users to buy and sell physical investment grade gold, was also certified by Amanie Advisors. Manuel Ho added that HelloGold would expand its gold platform into Thailand in coming months, while potentially adding a third market by the end of the year.

Yinson to raise $385m through #Islamic #bonds

Yinson Holdings is raising more funds through its Yinson TMC unit to raise MYR1.5bn ($385.2m) in perpetual mudharabah bonds. The raised money will be used to refinance outstanding financing facilities, provide funds for working capital and capital expenditure for new projects. AmInvestment Bank and Maybank Investment Bank are the joint principal advisers, joint lead arrangers and joint lead managers for the programme. Yinson also launched another $500m multi-currency perpetual bond programme last year in July.

#Insurtech #Malaysia: Volume 2, The Start-Up Edition

In this interview, two product aggregator start-ups, Jirnexu and Fatberry, are discussing their experiences in collaborating with carriers and regulators. Jirnexu is currently in the BNM Regulatory Sandbox and this way gets great support from the regulator. The regulatory sandbox has a customer-focused vision and uses its technology to help with communication, education and purchasing of Insurance. Fatberry is focused on the General Insurance space. It aims at focusing on the customer’s needs and pain points when building its solutions.

CIMB expects sovereigns to issue green Islamic bonds in 2018

CIMB Group Holdings expects sovereigns to issue 'green' Islamic bonds for the first time this year. CEO Rafe Haneef said about 3 to 5 sovereign sukuk issues are exptected to come to market this year and some of them will be green issuances. Corporates are also eyeing green sukuk issuances. Green bonds are a growing category of fixed-income securities, raising capital for projects with environmental benefits. Rafe says more and more investors are allocating funds for socially responsible investments (SRI) and Islamic bond issuers could benefit from that. He expects the total number of Islamic bond issuances this year to be slightly higher than last year, driven mainly by infrastructure bonds in Southeast Asia. He expects some new issuers to enter the sukuk market, saying state-owned enterprises from the United Arab Emirates and Qatar were possibilities.

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