| 04 May 2009 |
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International Islamic Financial Market (IIFM) Holds Its 20th Board of Directors Meeting
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Dubai, U.A.E. - 04th May 2009 - The 20th Board of Directors (BOD) meeting of the International Islamic Financial Market (IIFM)International Islamic Financial Market (IIFM)
was held over the weekend at the Standard Chartered BankStandard Chartered Bank, DIFC. The meeting was hosted by Standard Chartered Saadiq which is one of the board members of IIFMIIFM. Besides Standard Chartered Saadiq, IIFMIIFM Board of Directors are represented by senior members from Central Bank of Bahrain, Bank Indonesia, Labuan Offshore Financial Services Authority (LOFSA)-Malaysia, Ministry of Finance-Brunei Darussalam, State Bank of Pakistan, Bank of Sudan, Dubai International Financial Centre (DIFC), Islamic Development Bank, Bank Muamalat Indonesia, Bank Islam Malaysia Berhad, Kuwait Finance House, National Bank of Kuwait, ABC Islamic Bank, Calyon Corporate & Investment Bank and European Islamic Investment Bank.
Afaq Khan, CEO Standard Chartered Saadiq & Director of IIFMIIFM said "We are pleased to host the IIFMIIFM Board meeting at our bank and are committed to the development of the Islamic industry and will continue to play a positive role in industry development initiatives"
The Board of Directors today reviewed the major Islamic finance industry development initiatives spearheaded by IIFMIIFM such as the Master Agreements for Treasury Placement (MATP), which was launched last year to cater for global OTC commodity Murabaha trades.
Mr. Khalid Hamad, Chairman of IIFMIIFM
& Executive Director of Banking Supervision at Central Bank of Bahrain (CBB), stressed on the importance of the Islamic finance industry's first global master agreement and highlighted IIFMIIFM Board's foresight in concentrating on the development of benchmark master agreements and supporting the pioneering work undertaken by IIFMIIFM.Mr. Ijlal Alvi, Chief Executive Officer of IIFMIIFM, explained that since launch of the MATP, there has been a positive response not only from financial institutions but also from other market participants; and so far a number of institutions from various jurisdictions have already adopted the MATP while several more are completing their required internal processes.
"The Master Agreement is not only used for commodity Murabaha transactions but it can also be used for other products which involves Murabaha contract", said Mr. Alvi.
Mr. Afaq Khan, said that the MATP was an important milestone in the journey towards standardizing the main industry Agreements.
Mr. Nik Thani, Executive Director of Islamic Finance at DIFC & Director of IIFMIIFM, said "Standardization is a key element in the development of Islamic finance industry. It is not a simple process but nonetheless necessary to ensure the industry has a level playing field. The MATP a good example of how standardization can take place. It is the first of its kind and paves the way for more initiatives by IIFMIIFM such as the Tahawwut (Hedging) Master Agreement. The benefits would be immense in terms of reducing cost and resources when models for Islamic finance products are available of the shelf. DIFC is fully supportive of standardization initiatives that would bring benefit to the entire industry."
With respect to the IIFMIIFM-ISDA "Tahawwut" (Hedging) Master Agreement, the Board made note of the progress achieved so far and appreciated IIFMIIFM Secretariat's work in the development of a hedging framework document which will lead the way in risk minimization of Islamic economic activity.
Mr. Afaq Khan said, "Risk management solutions are the need of the Islamic industry with particular focus on treasury risk management. Islamic FI's continue to grow within their home markets and are increasingly adopting regional and International expansion strategies. It is imperative that they have adequate risk management tools to allow them to play a responsible role in their local economy and also in their expansion plans. Tahawwut Master Agreement is another important initiative from IIFMIIFM to help the industry in developing a mutually agreed standardized document. This will make it easy for banks to trade with each other."
At the meeting, Mr. Simon Eedle, Managing Director and Head of Islamic Banking at Calyon, was voted as Vice-Chairman of IIFMIIFM, with a responsibility to chair the executive committee. Mr. Eedle, who has served on the Executive Committee of IIFMIIFM for the last two years, was honoured to accept the position, and looked forward to the further growth of IIFMIIFM and its role in the development of the Islamic banking industry. "Banks and Islamic institutions in the industry have an important role to play to work together towards common standards for structures and documentation that will allow for more transparency and greater access to a wider range of participants. One of our major targets is to increase the participation of Islamic and conventional banks that are active in the industry, giving us a stronger resource to work on further standardization, and build on the success of the MATP, and the master hedging agreement that will be released later this year in conjunction with ISDA".
The Board also deliberated and assessed the concentration of IIFMIIFM towards other areas of industry development. In particular, the board of directors decided to look into the issues concerning investment made by banks through Wakala arrangements.
"Such initiatives are critical for activating sound, effective and truly global Islamic capital and money markets, both primary and secondary", said Mr. Khalid Hamad.
Moreover, the board also made several decisions with respect to conducting industry briefing sessions to create awareness, understanding and promotion of the Islamic capital and money markets globally.
The IIFMIIFM Board Members will continue to provide necessary strategic direction and strong support to IIFMIIFM in its market unification efforts.
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About International Islamic Financial Market
The International Islamic Financial Market (IIFM)International Islamic Financial Market (IIFM) is a Bahrain based international infrastructure development institution, supported by the central banks and regulatory authorities of Bahrain, Brunei, Dubai, Indonesia, Malaysia, Sudan, Pakistan and the Islamic Development Bank, Saudi Arabia as well as several financial institutions such as Kuwait Finance House, Al Baraka Banking Group, ABC Islamic Bank, Al Salam Bank, National Bank of Kuwait, Jordan Islamic Bank, Standard Chartered Saadiq, Bank Muamalat Indonesia, Bank Islam, Calyon Corporate & Investment Bank and European Islamic Investment Bank.
The objective of IIFMIIFM is to take part in the establishment, development and promotion of Islamic Capital and Money Market (ICMM).
IIFMIIFM's primary focus lies in the advancement and unification of Islamic financial documents, structures, contracts, instruments, infrastructure and recommendations for the enhancement of ICMM.
Contact:
International Islamic Financial Market
Kingdom of Bahrain
Ph: +973 17500161
Fax: +973 17500171
Email: iifm@batelco.com.bh
Website: www.iifm.net
Standard Chartered Saadiq
DIFC, Dubai
Contact Person: Lilian Yong-Babani, Regional Head, Corporate Affairs MENA
Ph: (+9714) 508 3221
Fax: (+9714) 428 2555
Email: Lilian.Yong-Babani@standardchartered.com
© Press Release 2009
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