KUALA LUMPUR: Malayan Banking Bhd., Malaysia's largest lender by assets, plans to start a stand-alone Islamic bank, its chief executive said Wednesday, in a move that could help it capture growing business in a competitive market.
"We have just applied for an Islamic bank license,'' Amirsham Aziz, chief executive of the bank, commonly referred to as Maybank, told Dow Jones Newswires.
The Islamic bank would begin operations as soon as the central bank approves it, he said.
Market players have speculated Maybank's Islamic bank would begin operations as early as this month.
Maybank already offers Islamic banking products, but establishing a stand-alone bank would make it a key player in the development of Islamic finance in Malaysia.
Islamic banks operate on Shariah law, which bans investments that pay interest - deemed usury by Muslims - or sponsor items involving alcohol, tobacco, pork, gambling or weapons.
Banks make money using a system of profit-sharing from returns on approved investments.
Malaysia has been trying to become a regional Islamic financial hub by awarding licenses to foreign Islamic banks and offering a wide range of Islamic financial products and services. - AP