Jakarta, Indonesia - Wednesday, 7th May 2014 - The International Islamic Financial Market (IIFM) held its 30th Board of Directors meeting in Jakarta. The meeting was attended by IIFM Directors /senior representatives from Bank Indonesia, Central Bank of Bahrain, Central Bank of Sudan, Autoriti Monetari Brunei Darussalam, Labuan Financial Services Authority (Malaysia), Islamic Development Bank, ABC Islamic Bank, Kuwait Finance House-Bahrain, Standard Chartered Saadiq and Credit Agricole Corporate & Investment Bank. The meeting was hosted by Bank Indonesia at its headquarters.
Dr. Hendar, Deputy Governor of Bank Indonesia welcomed all the IIFM Board of Directors to Bank Indonesia and hoped all the participants to have a very productive meeting and fruitful discussion.
The IIFM Board of Directors meeting was chaired by IIFM Chairman, Mr. Khalid Hamad Abdul-Rahman Hamad, Executive Director, Banking Supervision, Central Bank of Bahrain. He thanked Bank Indonesia for hosting the IIFM Board meeting for the fourth time and its leading association as one of the founding members of IIFM. He also thanked the IIFM Board of Directors for their contributions in the success of IIFM which is now one of the leading international standard-setting bodies for the development of the Islamic Financial Services Industry.
IIFM is at the forefront of Islamic finance development initiatives specifically in the area of Islamic Capital & Money Market (ICMM) standardization and the Board of Directors valued the publication of IIFM documentation standards and guidelines for Islamic Hedging and Islamic Liquidity Management. IIFM efforts with regards to creating legal certainty and required laws reforms in various jurisdictions for Islamic hedging transactions along with its joint partner International Swaps and Derivatives Association (ISDA) was also praised.
The IIFM Board deliberated on the industry's requests and recommendations on covering standardization of all types of Islamic financial contracts and decided to widen IIFM scope towards standardization of trade finance and corporate finance contracts.
The Board appreciated the work undertaken by IIFM in the area of Foreign Exchange products standard and collateralized liquidity management documentation which are on course to be published during 2014 as well as initiation of several new standardization projects and to cover other financial contracts as directed by the Board.
The Board commended IIFM efforts in holding two successful industry consultative meetings on Sukuk standardization requirements from documentation, structures and guidelines point of view which were very well attended by industry stakeholders.
Mr. Alvi mentioned that IIFM aim is to come up with more standards as per its well established comprehensive development process, some of which will be issued during 2014 and in the next year.
On the sidelines of the Board meeting, a specialized industry seminar on "Islamic Capital & Money Market" was also organized by IIFM with the support of the Bank Indonesia. More than 200 industry practitioners from Indonesia and the region were briefed by leading speakers from the Middle East, Europe and South East Asia on the technical aspects of Sukuk, Islamic hedging and liquidity management tools (Collateralization & Un-Restricted Wakalah). IIFM's global industry unification efforts were also highlighted by the speakers.
Mr. Khalid Hamad, IIFM Chairman in his opening address talked about IIFM efforts and he also encouraged greater participation in IIFM initiatives from institutions based in Indonesia as IIFM standards benefits not only cross border transaction but also assist more robust and transparent domestic business transactions.
Dr. Hendar, Deputy Governor of Bank Indonesia, delivered the key note speech by addressing the opportunities of Islamic finance industry to play more significant roles in the global economic development and emphasizing on the importance of IIFM to facilitate the industry development. IIFM is expected to provide more acceptable standardization of Islamic Finance Products that could serve as effective vehicles to achieve better economic interconnectedness and more sustained economic development. In addition to the IIFM agenda on cross-border collaboration and coordination amongst the government and Islamic financial institutions, Dr. Hendar stated that the IIFM industry seminar becomes very essential to promote greater harmonization in trade activities among the Islamic finance operating countries.
Mr. Alvi thanked the IIFM Board of Directors for their support and also extended his appreciation to Bank Indonesia for hosting the BOD meeting as well as supporting the IIFM Industry Seminar.
About Bank Indonesia
Bank Indonesia is the Central Bank of The Republic of Indonesia. A new chapter in the history of Bank Indonesia as an independent central bank was initiated when a new Central Bank Act, the UU No. 23/1999 on Bank Indonesia, was enacted on May 17, 1999 and have which has been amended with UU No.3/2004 on January 15, 2004. The Act confers it the status and position as an independent state institution and freedom from interference by the Government or any other external parties.
As an independent state institution, Bank Indonesia is fully autonomous in formulating and implementing each of its task and authority as stipulated in the Act. External parties are strictly prohibited from interfering with Bank Indonesia's implementation of its tasks, and Bank Indonesia has the duty to refuse or disregard any attempt of interference in any form by any party. Such unique status and position are necessary so that Bank Indonesia can implement its role and function as monetary authority more effectively and efficiently.
Bank Indonesia has a vision to be a credible institution and the best central bank in the region by strengthening the strategic values held as well as through the achievement of low inflation along with a stable exchange rate. In order to achieve its vision, Bank Indonesia maintains several missions:
1. To achieve rupiah exchange rate stability and maintain the efficacy of monetary policy transmission in order to drive quality economic growth.
2. To nurture an effective and efficient national financial system that can withstand internal and external shocks in order to support the allocation of funding/financing that contributes to national economic stability and growth.
3. To ensure a secure, efficient and smooth payment system that contributes to the domestic economy and helps maintain monetary as well as financial system stability whilst broadening access in the national interest.
4. To build and maintain the organization and human resources of Bank Indonesia, who are performance based and honor integrity, as well as to enforce good corporate governance in the implementation of tasks as mandated in prevailing laws.
About IIFM
IIFM is the Islamic Financial Services Industry's standard-setting organization focused on the Islamic Capital & Money Market (ICMM) segment of the industry. Its primary focus lies in the standardization of Islamic financial products, documentation and related processes at the global level. IIFM also contributes in the development of ICMM by organizing specialized industry seminars, workshops and consultative meetings as well as research on Sukuk issuances worldwide.
IIFM was founded with the collective efforts of the Central Bank of Bahrain, Islamic Development Bank (a multilateral institution based in Saudi Arabia), Autoriti Monetari (i.e. Monetary Authority) Brunei Darussalam, Bank Indonesia, Bank Negara Malaysia (delegated to Labuan Financial Services Authority) and the Central Bank of Sudan as a neutral and non-profit organization.
Besides the founding members, IIFM is supported by other jurisdictional members such as State Bank of Pakistan, Dubai International Financial Centre as well as a number of regional and international financial institutions and other market participants.
To date IIFM has published number of key Standard Master Agreements, including:
- Interbank Unrestricted Master Investment Wakalah Agreement & its Operational Guidance Memorandum
- ISDA/IIFM Tahawwut (Hedging) Master Agreement & Explanatory Memorandum
- Mubadalatul Arbaah (Profit Rate Swap) Standard Documentation
- Master Agreements for Treasury Placement & Structure Memorandum
IIFM is also in the process of developing several important documentation and product standards related to the Islamic Capital & Money Market. It has also published global Sukuk reports (first, second and third editions) and organized a number of seminar and workshops.
For PR inquiries, please contact:
Mr. Usman Mohammad Naseer
Email: usman.naseer@iifm.net
Tel: +971 17 500161
Website: www.iifm.net
© Press Release 2014
