Could you provide a brief journey of how you arrived where you are today?
I joined the AmBank Group through its commercial banking arm in 1996. Ever since then I have been responsible for overseeing corporate banking, which included the Islamic banking operations of the bank, among many other responsibilities in the dual-banking environment.
I spent 22 years in the banking and corporate sector and my experience includes merchant banking, commercial and retail banking, project financing, capital markets, loan rehabilitation and trade finance.
What does your role involve?
In short, my responsibility is to oversee the Islamic banking business of the group that resides under AmIslamic Bank.
I was the program principal in the program management office, responsible for driving the AmBank Group Islamic Banking subsidiary set-up, which culminated in the launch of AmIslamic Bank on the 1st May 2006. As CEO, I am responsible for managing the entity.
What is your greatest achievement to date?
My greatest achievement has been to bring the group’s Islamic banking division to the forefront and aggressively building the Islamic financing assets from a mere RM500 million (US$137.14 million) to over RM10 billion (US$2.74 million) in less than six years.
Which of your products/services deliver the best results?
As at September 2006 personal financing brings in total financing of more than RM1 billion (US$274.3 million); hire purchase-i brings in total financing of more than RM6 billion (US$1.65 billion); and the al-Taslif card-i card base is more than 200,000 cards.
What are the strengths of your business?
Our strengths include group infrastructure/network; group understanding and support for the Islamic banking business; a strong product development team; and the operational philosophy of true Islamic banking.
What are the factors contributing to the success of your company?
A large network: more than 170 AmBank and AmIslamic Bank shared branches; 13 years of experience in offering Islamic banking via AmBank; loyal customers; and an extensive product range – everything is under one roof.
What are the obstacles faced in running your business today?
I see them more as challenges rather than obstacles. Some of them are to come up with the right business model to do true business in the realm of Islamic finance; the growing movement of Islamic banking towards global presence; regulatory, risk management and operational framework to cater to the business models for equity type of financing/participation under the Musharakah/Mudharabah concepts and leasing structures; legislative framework to accommodate Islamic finance business; dynamism and sustainability of the present Islamic business model in the medium to long-term period to remain relevant; manpower issues; the need to create more products (innovative); and the ability to implement a truly independent Islamic banking entity.
Where do you see the Islamic finance industry, maybe in the next five years?
I believe that Islamic financial institutions will essentially operate in a truly universal banking concept. There will be more product innovations in the area of equity structures; a clear distinctive pathway from conventional banking; and finally the growth of the industry will be phenomenal, with Islamic institutions and non-Islamic institutions pushing for development.
All of these will become a reality not through a single effort, but through the combined force of the Islamic banking community, i.e. the regulators, players and the international community. By 2010, I believe that the industry could achieve more than the 20% target. As for now, the industry has achieved 12% of its total financing.
Name one thing you would like to see change in the world of Islamic finance?
I would like to see a focus on equity financing, given that the focus of most other players has been debt financing, while equity or specialized business is given less attention. The industry should aim to enter into partnerships and joint ventures in different projects and businesses, i.e. taking stakes in projects as part of the offerings.
Currently 95% of transactions are debt-based financing, thus another 5% can make up for Musharakah, which encourage the bank to participate in the business itself. At the moment we are developing and planning to develop the right business model and, moving forward, we feel that there is a big business industry for Musharakah.
AmIslamic Bank has a long and distinguished history in Islamic banking, serving banking needs of industries and individuals via the AmBank Group Islamic Banking, which was established in 1993. In 2001, the Islamic banking operation of AmBank and AmFinance was consolidated and AmIslamic Bank was established.