The Islamic Bank of Asia Limited Singapore: The Fulcrum of Islamic - - PowerPoint PPT Presentation

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The Islamic Bank of Asia Limited Singapore: The Fulcrum of Islamic - - PowerPoint PPT Presentation

The Islamic Bank of Asia Limited Singapore: The Fulcrum of Islamic Finance Development Disclaimer: The information contained in this document is intended only for use during the presentation and should not be disseminated or distributed to


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Disclaimer: The information contained in this document is intended only for use during the presentation and should not be disseminated or distributed to parties outside the presentation. The Islamic Bank of Asia Limited accepts no liability whatsoever with respect to the use of this document or its contents.

The Islamic Bank of Asia Limited

Singapore: The Fulcrum of Islamic Finance Development

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Bahrain

Islamic Finance Asset Size: US$1 trillion Middle East: 50% Far East: 25% China: 1.3 bn pop GDP: US$2,668bn India: 1.1 bn pop GDP: US$906bn

2 hours 3 hours 4 hours 5 hours 7 hours

SE Asia: 568 m pop GDP: US$1073bn

Singapore: At The Heart of Asia – The Fulcrum of M-East and F-East

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Singapore: A Strategic Hub for Islamic Finance

28,000 International Companies: 11,200 NA, Europe, Japan 1,900 China 1,900 India 1,500 Australia & New Zealand 7,500 Rest of Asia 4,000 Rest of the World

The status of Singapore as a regional financial hub is an opportunity for Islamic finance…. ….to become a significant alternative financial solution regionally and globally.

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  • urc e : MAS

Asse t Manage me nt S urve y 2006

S$ Bn 276 307 344 465 573 720

2000 2001 2002 2003 2004 2005 2006

891

F

  • r

e ign Companie s 37% Singapore Companie s 63%

SGX listing – With a market cap of circa S$800billion, this is the choice of good corporations to tap equity.

Singapore: A Strategic Hub for Islamic Finance

Singapore has built a reputation as a credible and transparent financial centre, which is exactly what Islamic finance needs to shed its image as a “niche” solution.

Growing AUM – A sign of confidence

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157 Banks 153 Insurance Companies 97 Fund Managers 77 Securities Dealing 67 Financial Advisors 62 Insurance Brokers 40 Futures Trading 36 Corporate Finance 3 Finance Companies

1 Islamic Bank

Singapore: Almost 700 Financial Institutions

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Singapore: Still No. 3 Financial Centre (Mar 09)

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Singapore: Financial Sector Growth 1974- 2007

Banking Assets 1974 Aug 2007 S$36 billion S$1.79 trillion Stock Market Capitalisation 1975 Oct 2007 S$14 billion S$824 billion FX Average Daily Turnover 1974 Sep 2007 S$0.8 billion S$344 billion Asset Management 1990 2006 S$18 billion S$891 billion Singapore Government Securities Market 1987 Oct 2007 S$4.5 billion S$96.3 billion

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Singapore: Islamic Finance Milestones

  • MAS became a member of IFSB
  • Banks allowed to undertake Commodity

Murabaha for both financing and deposit taking

  • Removal of double stamp duties in Islamic

transactions involving real estate

  • FTSE-SGA Asia Shariah 100 Index launched
  • GST and Income Tax Act have been amended

to cater for Islamic finance transactions

  • Sukuk enjoys similar concessionary tax as

bond

2008 - 2009 2005 - 2007

  • 5% concessionary tax rate for qualifying

Shariah compliant financial activities

  • 1st Shariah compliant ETF launch on SGX
  • 1st Commodity Murabaha by SGX Listco
  • 1st conversion of REIT into Islamic REIT
  • 1st Sukuk issuance by AAA rated

sovereign in the world

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Common challenges e.g.

  • Product Development
  • Risk Management
  • Standardization of Shari’a opinions
  • Management buy-in of clients
  • Comfort level with structure
  • Confidence in risk mitigation
  • Robustness of infrastructure
  • Ease of documentations

Islamic finance has come quite a way in Singapore. It still has quite a journey to travel. Let’s enjoy the ride!

Singapore: Has Made Significant Strides, Still A Long Way To Go