The International Islamic Financial Market (IIFM), an international institution focused on the development of the global Islamic capital and money markets, has begun work on several industry uniformity projects and a key feasibility study to develop an Islamic capital market management system.
The Bahrain-based institution also plans to organize two major specialized, technical conferences in the coming months.
Financial contracts convergence, the feasibility study and the specialized events are the key elements of an IIFM work program, which was recently reviewed by the IIFM Board during its meeting held in Jakarta, Indonesia, on 11 September 2006.
The Board meeting, followed by a specialized conference and workshop on Islamic banking, capital and financial markets, was chaired by IIFM Vice Chairman, Mr. Khalid Hamad, who is Executive Director, Banking Supervision, at the Central Bank of Bahrain (formerly the Bahrain Monetary Agency).
“The Board has reviewed and approved an ambitious, but practical, work program for the coming one year. The program is focused on the IIFM’s core mission of facilitating and stimulating the development of Islamic capital and money markets,” said Mr. Hamad.
Mr. Ijlal Alvi, Chief Executive Officer of IIFM, thanked the Board for providing strategic direction and timely approval for a robust work program for the IIFM.
Of the two planned specialized conferences, one will be held in Karachi, Pakistan, on 24 & 25 January 2007 and the other will be held in Bahrain in mid-2007.
The feasibility study on the development of a capital market management system and related issues, is expected to be completed by 2006-end.
The Board also approved the establishment of a number of sub-committees, including a working group for a joint project of IIFM and The International Swaps and Derivatives Association (ISDA). The two institutions recently signed a Memorandum of Understanding as a basis for developing a master agreement for documenting privately negotiated Shari’a compliant derivatives transactions.
Mr. Alvi said he was gratified by the support for the IIFM by central banks of different jurisdictions as well as by the global Islamic financial services industry.
“As IIFM’s host regulator, the Central Bank of Bahrain continues to play a key role in enabling IIFM to shape and crystallize the common vision for the development of the global Islamic financial services industry,” he said.
The recently-held conference and workshop, held in Jakarta, received tremendous support from Bank Indonesia, the central bank of Indonesia, and Bank Muamalat Indonesia, as Host of the event.
The conference, which was inaugurated by H.E. Dr Burhanuddin Abdullah, Governor of Bank Indonesia, attracted over 200 participants, representing central banks and financial services regulators and Islamic banking practitioners from all over the world, as well as members of Parliament from Indonesia.
“Conference delegates were particularly interested to learn that Indonesia will, later this year, enact a law for sukuk issuance. The industry expectation is that Indonesia will soon be coming into the sukuk market with a sovereign issuance,” said Mr. Alvi.
“This will be a major development for the global sukuk industry, which has seen dramatic growth in recent years.”
Sukuk issuances have exceeded US$7 billion during 2006 alone, with the global sukuk market currently estimated at US$19 billion.
“The appetite for Islamic capital and money market instruments is tremendous and growing and IIFM intends to play an effective role in further developing and advancing this industry,” said Mr. Alvi.
About International Islamic Financial Market
The International Islamic Financial Market (IIFM) was established in Bahrain in 2002 by the Islamic Development Bank, the central banks of Bahrain, Malaysia, Sudan and Indonesia and the Brunei Finance Ministry.
The mission of the IIFM, a globally-focused non-profit institution, is to develop the primary Islamic and short term financial market and, subsequently, the creation of a secondary market for Islamic financial instruments. IIFM is also focused on the advancement and standardization of Islamic financial instrument structures and contracts, infrastructure development, Islamic management system, issuance of guidelines and enhancing cooperation among the world’s Islamic financial institutions.
For more information about the IIFM, please visit the IIFM website at www.iifm.net
