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August 20, 2009 17:28 PM

Bank Islam To Continue To Launch Innovative Products

KUALA LUMPUR, Aug 20 (Bernama) -- Bank Islam Malaysia Bhd expects to be launching innovative products both for the individual consumer and corporate sector in keeping with the growing demand for Islamic financial products.

Its general manager of Treasurer Division, Norashikin Kassim, said the bank was constantly innovating products to tap the US$1 trillion global Islamic finance market.

"There is a lot of demand for Islamic products both locally and overseas, and we are constantly innovating to produce solutions to meet our customers' needs.

"We will look at launching both on the consumer and corporate side and will make the announcement in due course," she told reporters at the sidelines of the Malaysian Corporate Conference 2009, organised by the Association of Islamic Banking Institutions Malaysia, here on Thursday.

Norashikin said with Islamic financing projected to grow even more rapidly in the next five to 10 years, Bank Islam was in the position to tap the market as the bank already offered a complete range of Islamic products both for its individual customers and corporate clients.

She said more customers were also beginning to understand that the Syariah based Islamic banking was not just about religion based banking, but premised on ethical values.

Norashikin said Bank Islam was also the first bank in the world to minimise risk exposure to fixed rate payments, by swapping some of them with a conventional bank for floating rate payments.

"For profit rate or interest rate for conventional, we offer Islamic profit rate to hedge against interest rate from increasing. Customers can enter Islamic profit risk with Bank Islam to convert it from floating rate to a fixed rate," she said.

Bank Islam also offers products that hedge against a floating rate in the foreign currency.

"A ringgit-based company that has taken financing in US dollar can enter into Islamic cross currency profit risk swap to convert the US dollar floating rate to a fixed ringgit rate which is Syariah compliant," she explained.

Among the financing deals offered by Bank Islam are Wiqa' Forward Rate Agreement (WFRA), Wiqa' Profit Rate Swaps (WPRS), Islamic Cross Currencies Swap (ICCS) and Commodity Murabahah.

-- BERNAMA

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