Elaf gets Islamic banking licence from Bank Negara
KUALA LUMPUR: Bahrain-based Elaf Bank B.S.C has received approval from the Government to carry out international Islamic banking business in the country under the Islamic Banking Act 1983.
In a statement yesterday, Bank Negara said the Minister of Finance had granted approval to Elaf Bank.
It said Elaf Bank was allowed to conduct a wide array of Islamic banking business in international currencies other than Malaysian ringgit.
“Elaf Bank’s presence will further strengthen the economic and financial linkages between Malaysia and Bahrain and contribute further to the development of the Islamic financial system in Malaysia,” the central bank said.
Last October, Elaf Bank chief executive Jamil El Jaroudi was quoted at saying that it had applied for a Malaysian Islamic banking licence after securing six financing deals worth about US$1.4bil in the country and Indonesia.
He said the licence would enable Elaf to execute the deals and conduct other dollar-denominated Islamic banking business.
“We have a couple of mandates here in Malaysia and in Indonesia which convinced us more and more that we would like to be in South-East Asia.”
Jamil said US$1.2bil of the deals Elaf had been mandated for were in Malaysia and US$200mil in Indonesia.
“Indonesia is a huge market which is not very much tapped yet from the Islamic point of view and we believe the potential is fantastic there,” he said.
“However we would be doing that most probably through Malaysia.”
Elaf Bank has announced the opening of its “first branch office” to be located in Kuala Lumpur on its corporate website.
“This branch office will be the centre of operations for the bank in South-East Asia, further extending the activities of the main branch in Bahrain, and giving Elaf Bank a competitive edge in both strategic markets,” Elaf Bank said.
It said the opening of the branch office here was yet another step towards achieving the bank’s vision to create “virtual corridors” among major Islamic finance hubs.
“Malaysia is viewed as an exemplary Islamic finance market, and has achieved the status of being recognised as the centre for Islamic finance in South-East Asia.
“With this strategic move, Elaf Bank is embarking on a well defined growth path harmonious with its intent of broadening the opportunities and growing the geographical scope and reach of Islamic finance to benefit both the Middle East and South-East Asia regions, and beyond,” Elaf Bank said.
In a separate statement, Elaf Bank said yesterday it planned to start its branch office “immediately” now that it had fulfilled the formalities required for obtaining the license.
Jamil said Elaf Bank was developing its business through two hubs covering the Gulf Cooperation Council, Middle East and North Africa region, and the South-East Asia region, as a two-way business corridor.
“Being a wholesale Islamic bank headquartered in Bahrain, the logical next step would be to open our first international branch office in the capital of Islamic finance in Malaysia.
“This will help us operate more efficiently and closely to meet the needs of our cross-regional clients, and be able to execute deals that will contribute to the sustainable growth of the Islamic finance industry in both strategic markets,” he said.
Elaf Bank is a closed shareholding company incorporated in Bahrain. It operates as an Islamic wholesale (investment) bank with a paid-up capital of US$200mil.
It provides the full spectrum of wholesale Islamic banking and it is also involved in the development of the sukuk secondary market where it acts as a market maker.
Source: thestar.com.my
