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DBS' Islamic arm clinches deals worth over $689m
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| Grace Ng |
Wed, May 21, 2008
The Straits Times
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DBS Bank's Islamic banking unit has clinched over 20 deals worth more than US$500 million (S$688.5 million) in its first year of business.
The Islamic Bank of Asia (IB Asia), which marked its first anniversary yesterday, said the huge haul included US$200 million of deals it committed to in the first quarter of this year.
The bank, a joint venture between DBS and 34 investors from prominent families and industrial groups based in the Gulf Cooperation Council (GCC) countries, was set up in May last year.
IB Asia chairman Abdulla Hasan Saif said in a statement: 'IB Asia's rapid progress is particularly encouraging because it underscores our progression from a newcomer to an innovative financial services provider that became profitable within the first 12 months.'
| IB Asia, which is based in Singapore, has also opened its first representative office in Bahrain to get 'easier access to shareholders and customers in the Gulf', the bank said in a statement yesterday.
The bank is also keen to explore setting up a presence in Saudi Arabia, the United Arab Emirates, Kuwait and Qatar, a Reuters report on Monday quoted IB Asia chief executive Vince Cook as saying.
The office will focus on developing the bank's wholesale, commercial and investment banking businesses in the GCC countries.
Islamic banking follows syariah law, which forbids payment of interest, financial speculation or investment in business sectors such as gambling and alcohol.
IB Asia's board met in Bahrain yesterday for its annual general meeting. The bank also has a syariah board consisting of Islamic scholars.
In its first year of operations, IB Asia has focused on building up its business in the wholesale financing markets while developing a range of treasury services, including the provision of foreign exchange and money market activities.
Mr Cook said the bank's next phase is to 'launch more complex treasury products, including a proprietary and efficient profit rate swap structure, forex forwards... and structured products'.
This is to position the bank 'as one of the few standalone Islamic banks' able to offer such products to international investment banks.
He added that the bank was 'in discussions with a number of Asian and GCC-based companies and international agencies on future sukuk issues'. Sukuk refers to Islamic bonds.
The bank intends to launch its first syariah-compliant Asian equities fund and is also in the process of establishing a real estate fund targeting special opportunities in the region.
IB Asia is also reportedly looking at buying a stake in a Malaysian bank as part of its plans to expand across Asia.
graceng@sph.com.sg
NEXT STEP
IB Asia chief executive Vince Cook said the next phase is to 'launch more complex treasury products' to position itself 'as one of the few standalone Islamic banks' able to offer such products to international investment banks.
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