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Alkhair Islamic Bank Bhd (AKIIB) has appointed Datuk Adissadikin Ali as its new chief executive office, succeeding Ikbal Daredia effective June 1, 2015. The bank said on Friday that Adissadikin would be responsible for the development of AKIIB, as it is the first Islamic bank in the country to conduce a full range of non-Malaysian ringgit banking activities. He will also oversee all aspects of AKIIB business in Malaysia and the surrounding regions. Meanwhile, it noted that Adissadikin has 15 years experience in the financial services sector which gave him wealth of management and leadership exposures in the industry.

Prime Minister Datuk Seri Najib Razak today urged Japan to partner Malaysia in engaging in Islamic finance-related activities and tap the huge global market. With Japanese industrial expertise and technology, and Malaysia’s technical expertise in Islamic finance, he said there was an opportunity to establish a formidable alliance. On a much larger scale, he said that in late 2013, China announced the plan to establish the Asian Infrastructure Investment Bank or AIIB, and currently has 57 charter members and a paid-up capital of US$50 billion.He added that Malaysia understands and respects that Japan has reservations over the AIIB, but regardless of the vehicle, it is apparent that Asian countries need to invest in tangible infrastructure assets.

Demand for Malaysian Islamic real-estate investment trusts may withstand a sluggish property market as their steady rental income is popular with pension funds amid a shortage of Shariah-compliant assets. Johor Corp plans to list the RM900 million (S$333 million) Al-Salam REIT, Kamaruzzaman Abu Kassim, the company's president said. The prospectus will be registered by July and the trust expects to deliver returns of around 6.3 per cent in 2016, he said. Al-'Aqar Healthcare REIT, majority owned by Johor Corp, returned 11.7 sen a unit to shareholders. That worked out to a dividend yield of 8.4 per cent based on its year-end closing price.

Malaysia's successful pricing of the US$1.5 billion (RM5.4 billion) global sukuk has strengthened the country's position as an international centre for Islamic finance, says Prime Minister Datuk Seri Najib Razak. Najib, who is also finance minister, said the 30-year tranche was the government's inaugural sukuk issuance, which is also the longest tenured sukuk. The issuance comprises US$1 billion of 10-year and US$500 million of 30-year benchmark Trust Certificates (Sukuk) for a total size of US$1.5 billion. Najib said the deal was oversubscribed, attracting an aggregate interest of US$9 billion from a combined investor base of more than 450 accounts.

Malaysia’s state-owned sovereign wealth fund is about to test appetite for the nation’s first socially responsible Islamic bonds and plans to issue such debt annually. Khazanah Nasional Bhd will start marketing as much as RM150 million (US$42 million) of the seven-year sukuk today, Chief Financial Officer Mohd Izani Ghani said. The offering will fund 20 schools in Malaysia, he said, adding that future sale options may include healthcare and affordable housing. The SRI sukuk will pay fixed, periodical profit rates throughout the bond’s term, with principal repayments linked to the individual school’s performance in terms of the quality of education provided, said Izani. Before maturity, the profit rate will be adjusted lower, he said. The “step-down yield” could be 100 basis points below the coupon rate.

Khazanah Nasional Bhd. will start marketing as much as 150 million ringgit ($42 million) of the seven-year sukuk on Monday, Chief Financial Officer Mohd Izani Ghani said. The offering will fund 20 schools in Malaysia, he said, adding that future sale options may include healthcare and affordable housing. While it would be a challenge convincing investors to buy because the concept is new, the offering will be a catalyst for further issuance in an area that’s still nascent. The SRI sukuk will pay fixed, periodical profit rates throughout the bond’s term, with principal repayments linked to the individual school’s performance in terms of the quality of education provided. Before maturity, the profit rate will be adjusted lower, he said.

Syarikat Takaful Malaysia Berhad has revealed that it bought a RM85 million Islamic bond from 1Malaysia Development Berhad (1MDB) in 2009, but the Islamic insurance company assured that the investment was low-risk. Takaful Malaysia group managing director Datuk Seri Mohamed Hassan Md Kamil said the bond was purchased from Terengganu Investment Authority (TIA), which was 1MDB's previous incarnation. It was purchased at a coupon rate of 5.25% and will mature in 2039. The bond iis guaranteed by the government. Hassan said the sukuk only represented about 2% to 3% of its total asset base of RM7.1 billion. He said 1MDB had yet to redeem the bond.

Syarikat Takaful Malaysia Bhd expects contributions in 2015 to grow faster than the industry average of 11 per cent, said Group Managing Director Datuk Seri Mohamed Hassan Kamil. He said the business trend and success rate in securing new customers look positive compared to the previous year especially in the Employee Benefit business, which has seen a shift from conventional to Takaful insurance. The group expects about 20 per cent growth in contributions for employee benefit from RM300 million registered last year, and aims to secure up to 600,000 policy holders, up from 400,000 recorded in 2014, said Mohamed Hasan. For the financial year ended Dec 31, 2014, the group's profit after tax grew three per cent to RM138.7 million from RM134.4 million in the previous year, while revenue decreased by 3.5 per cent to RM1.65 billion.

Kuwait Finance House (KFH) is restructuring activities ahead of a planned divestment by its largest shareholder, the Kuwait Investment Authority (KIA). Last week, KFH said it had hired Credit Suisse to advise on its options, including the potential sale of a Malaysia unit launched in 2005 that serves as a hub for southeast Asia. KFH did not give further details. A shift away from Malaysia, where KFH holds a valuable licence but lacks scale, would help it focus on Kuveyt Turk, the largest Islamic bank in Turkey with over 500 branches. Kuveyt Turk, 62 per cent owned by KFH, is in expansion mode: It plans to launch Germany's first full-fledged Islamic bank in July as a gateway to Europe.

Malaysian fund manager i-VCAP Management has launched Southeast Asia’s first fully Sharia-compliant ETF, which will track equities in markets including Malaysia, Indonesia, Thailand, Singapore and the Philippines. Malaysia is arguably the planet's top market for Islamic and Sharia-compliant products, with an estimated US$135 billion or so in such assets. The MyETF MSCI SEA Islamic Dividend ETF is i-VCAP Management's third ETF, following the launch of two other similarly-themed Sharia-compliant ETFs.

Kuwait Finance House (KFH), the Gulf nations' biggest Islamic lender, may sell some of its investments including KFH Malaysia and has picked Credit Suisse to advise it on the matter, KFH said on Wednesday. It did not provide any details such as a timeline or a potential sale price of the unit.

Johor Corp (JCorp), a Malaysian state-owned firm, plans to list an Islamic real estate investment trust (Reit) holding MR900m ($253.22m) in assets by the third quarter of this year.

Khazanah Nasional is set to issue Malaysia's first social-impact sukuk. Local agency Ram Ratings said the RM1 billion (US$282 million) Sukuk Ihsan programme, to which it assigned a AAA rating last week, was the first social-impact bond to be rated globally. Proceeds will go towards educational projects. Investors and market observers are eagerly expecting the first issuance off the programme as early as next month, although marketing preparations are still being finalised. Socially responsible investment is catching on slowly in Asia, but issuers in South Korea, India and Taiwan have sold so-called Green bonds and interest from investors is growing.

The BNP Paribas - INCEIF Centre for Islamic Wealth Management (CIWM) and Labuan International Business and Financial Centre (Labuan IBFC) held their 2nd annual Islamic Wealth Management Symposium on 28 April 2015 in Kuala Lumpur, aimed at raising national awareness of Islamic wealth management, particularly Islamic trusts and foundations. The Symposium also marked the public unveiling of Labuan IBFC's international waqf foundation, the first Islamic foundation designed with the international market in mind. The Symposium attracted more than 150 delegates. A total of 12 speakers and panelists ranging from regulators, Islamic scholars, academics and industry practitioners, convened to discuss Islamic wealth management.

Russia is looking to Malaysia to assist and build its knowledge and human capital in Islamic Finance, as it looks to introduce the system for its Muslim citizens. A delegation from Malaysia, consisting of representatives of a subdivision of the Central Bank of Malaysia for development of Islamic finance and University Tun Adbul Razak, visited Russia in February to assess the market. Earlier this year, two major Islamic banking institutions, Al Baraka and Al Shamal, announced that they are actively looking for partners in the Russian market at a recent banking summit. Working with a local partner will allow them to operate legally in Russia.

Lloyd's is in talks with market regulators in Malaysia to set up an office dedicated to takaful. The planned office will also enable Lloyd's to target Saudi Arabia and the United Arab Emirates, which together with Malaysia are the largest global markets for Islamic insurance, the marketplace's director of global markets, Vincent Vandendael, said. Lloyd's opened an office in the Dubai International Finance Centre (DIFC) earlier this year. Lloyd's has historically provided cross-border reinsurance in Malaysia as a foreign reinsurer, but also has a 'tier 2' licence allowing its syndicates to set up service companies in the Labuan International Business and Financial Centre (IBFC).

With the easing of economic sanctions against Iran, the country is expected to unleash its enormous potential of Islamic finance and enter the global stage with new Shariah-compliant products at a size that could threaten the dominance of Malaysia and Saudi Arabia in the sector. Iranian banks represent the world’s largest financial system based on Shariah law. However, due to the sanctions, the country has so far only marginally participated in the global Islamic finance sector and thus did not benefit from the rapid global growth of Islamic finance in the recent past. The entire banking system in Iran is Shariah-compliant, and there are no conventional banks to compete with.

Moody's Investors Service has assigned definitive A3 senior unsecured ratings to the US dollar trust certificates issued by Malaysia Sovereign Sukuk Bhd, a special purpose vehicle established by the government. Moody's said on Wednesday its definitive ratings for these debt obligations confirmed the provisional ratings assigned on April 6. The A3 rating assigned to the sukuk is at the same level as the long-term local-currency and foreign-currency issuer ratings of the Government of Malaysia. The proceeds of the sukuk will be used by the issuer to invest in the purchase of an asset pool consisting of Ijara assets, the right to participate in the provision of transportation services in Malaysia, and Shariah-compliant commodities.

Malaysia's Bank Islam issued its first sukuk tranche worth 300 million ringgit ($83.13 million) under its 1 billion ringgit sukuk murabahah programme, BIMB Holdings Bhd said on Wednesday. The tranche has a 10-year tenure and could only be redeemed after 5 years. Proceeds will be used to finance its banking activities and working capital, all of which would be sharia compliant.

Maybank Islamic Bhd expects the bulk of its mudarabah deposit account holders to reclassify their accounts to mudarabah investment account (IA), in compliance with Bank Negara’s requirement. Chief executive officer Muzaffar Hisham said the 350,000 customers of the bank’s existing mudarabah deposit products had been given until May 31 to consent to either have their accounts reclassified as IA or other syariah-compliant deposit products. Some 70%-80% of the bank’s customers were expected to make the switch as the IA was a compliance requirement arising from the central bank’s Islamic Financial Services Act 2013.