KUALA LUMPUR: Malayan Banking Bhd (Maybank) has expanded its range of foreign currency offerings by launching two treasury products, foreign currency deposit and placement, utilising the Commodity Murabaha (sale on cost-plus basis) principle.
In a statement yesterday, Maybank said the foreign currency commodity Murabaha Deposit-i (FCMD-i) was a syariah-compliant liquidity management product to facilitate investors to mobilise their surplus funds into the Islamic financial market.
It said the product was aimed at corporations and businesses with revenue inflow denominated in foreign currency, the source of which ranged from export or trade-related proceeds to all kinds of receivables.
“These are the segment of customers with a natural hedge position, who have commitments and liabilities in foreign currency to be settled either in the short term or on short notice. Maybank Islamic also welcomes high net worth individuals to participate in the programme,” it said.
The minimum deposit in foreign currencies offered is equivalent to RM1 million for a minimum tenure of 14 days. “It will assist the customers to better manage their liquidity from the perspective of maximising profit and minimising opportunity costs,” said Maybank Islamic Bhd’s acting chief executive officer Ibrahim Hassan.
On the foreign currency commodity Murabaha placement-i (FCMP-i), Maybank said it was a syariah-compliant liquidity management product which could be used to facilitate interbank transactions. It said it was a channel through which Maybank Islamic made available foreign currency denominated funds to the players in the Islamic interbank market.
For a start, the FCMD-i and FCMP-i would be offered in four currencies — US dollar, euro, British pound and Australian dollar.
As the contracts employ the Islamic principle of tawarruq, customers will be required to appoint Maybank Islamic as the agent to make sale and purchase transactions of commodities with a third party on their behalf.
Maybank said the two products were in line with its Islamic’s strategy to grow its business under the International Currency Business Unit (ICBU).
In January, it became the first bank in the country to launch offshore foreign currency financing, which is a short-term trade financing facility for exporters and importers and the foreign currency account, a mudarabah deposit account. Maybank Islamic expected its ICBU unit to have a comprehensive range of foreign currency products by the end of this year.
“The ICBU business, along with Islamic investment banking, takaful and wealth management, are the strategic focus of Islamic business for the Maybank group.