Entries in English and Malay (Bahasa Melayu)

Thursday, 1 March 2012

Malaysia: Zakat (Tithe) collection in Federal Territory up 24% in 2011 to RM341.3m

Pusat Pungutan Zakat Majlis Agama Islam Wilayah Persekutuan (PPZ-MAIWP) tithe collection increased 24% to RM341.3 million compared to the RM275.6 million recorded in 2010.

PPZ-MAIWP said the collection was on the back of a 13% increase in number of payers to 100,497 from 89,110 in 2010.

“The increase in collection reflects the increase in public awareness due to PPZ-MAIWP’s campaigns and promotions throughout the year through mass media.

“This was also due to the continuous support from Jabatan Kemajuan Islam Malaysia, Jabatan Wakaf, Zakat dan Haji, MAIWP, the Federal Territory of Islamic Affairs Department Baitulmal-MAIWP and Yayasan Taqwa,” the zakat collection body said in a statement last Thursday.

It said collection of business zakat increased 63% to RM54.9 million from RM33.6 million recorded in the same period last year.

PPZ-MAIWP said it was due to the increasing number of companies paying tithe of 10% to 1,571 companies compared to 1,427 in 2010.

“Our recent approach where we allow companies and individuals to take 37.5% from zakat perniagaan (business) paid and 25% from individual tithe paid to be distributed to asnaf (group entitled to receive tithe) by themselves has encouraged companies and individuals to pay their tithe,” it said.

PPZ-MAIWP said as at Dec 31, 2011, 39 companies had used this approach with the pay back amount by the tithe collection body stands at RM10.5 million.

Meanwhile, PPZ-MAIWP targets to collect RM360 million tithe collection with 108,500 payers for 2012. The target will be revised after the first six months of the year, it said.

(MalaysianReserve, 16 Jan2012)

Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

Malaysian Takaful Association (MTA) expects takaful players to easily adopt new framework

KUALA LUMPUR: The risk-based capital (RBC) framework for the local takaful industry is expected to take effect by January next year or the following year but will not be onerous to industry players as it will likely be based on the parameters of the conventional insurance framework, according to the Malaysian Takaful Association (MTA).
Deputy chairman Zainudin Ishak said the capital requirements under the proposed RBC framework for takaful would not burden the industry and would be benchmarked to the RBC framework introduced in January 2009.
Under the conventional framework, insurance companies are required to have a minimum 130% of supervisory capital-adequacy ratio (CAR).
He told StarBiz that the guidelines for the new framework in the takaful industry may be issued this year. 
One significant change in the new framework would be the explicit mentioned of “Qard” (interest-free loan) and its proposed treatment by the operators.
This new rule imposed a legal obligation on the takaful operators to provide for Qard to the takaful funds that are in deficit.
The underlying formula in determining the CAR had been set in a manner that it required takaful operators to hold sufficient capital in the shareholders' fund to meet any potential deficits in the takaful funds, he said.
“Most of the takaful players are already benchmarking with the existing RBC framework for conventional insurance and it would not be a problem for them to adopt the new framework when it comes on stream.
“Although the level of preparation among takaful players towards the new framework may differ, nonetheless MTA is confident it will be a smooth transition,” he said during an interview.
He added the need for the framework was to ensure takaful operators at all-time maintained adequate capital level that commensurate with their operational risks and act as a financial buffer against any exposure to risks.
On whether the requirement to hold adequate capital under the framework would spark consolidation in the takaful industry as it did previously in the conventional insurance segment, Zainudin said he did not foresee it happening as most of the takaful players were well capitalised and had foreign shareholding base.
Most analysts agreedthat the RBC framework in the takaful industry would not lead to merger and acquisitionsunless the shareholders of smaller takaful operators are not willing to invest or inject capital as in the case of smaller general insurers which had to merge under the RBC conventional insurance framework.
There are currently 12 takaful operators in the country.
Asked whether the current eurozone sovereign debt crisis and the slowdown in the US economy would impact pricing of insurance or takaful, he said it would be if the crisis was left unabated, adding that most reinsurance was sourced from European reinsurers like Munich Re and Swiss Re.
Zainudin said: “If the situation in the eurozone worsens and causes the reinsurers to hike their pricing, then the takaful and insurance companies including those in Malaysia would likely see higher prices for takaful and insurance products.”
Growth wise, he said the new Financial Sector Blueprint (2011-2020) would provide the impetus for the takaful industry to grow further by promoting access to other financial services sectors by introducing a range of directives, guidelines and best practices that would indirectly facilitate and drive its growth.
Among the recommendations in the blueprint were to develop a vibrant private pension industry for retirement and old age and the provision of wealth management products and services to cater to the demand of the growing affluent segment.
The industry experienced a compounded average growth rate of 27% in terms of net contributions between 2005 and 2010, with family takaful driving the growth at 28% for the same period.
Family takaful growth dominated over 80% of the total takaful market in 2010, and MTA was upbeat on the continued strong growth momentum, underpinned by rising affluence amid strong economic fundamentals.
Given the large untapped market that still exists with only 54% of the population having a life insurance or family takaful policy, the takaful industry was poised to benefit in years ahead, Zainudin added.
He said some of the major issues in the industry were inadequate investment instruments to meet the needs and demands of businesses as well as the shortage of talent.
(TheStarOnline, 28 Feb2012)

Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

Tunisia planning to issue Islamic bond

BAHRAIN (Reuters) - Tunisia's government plans to issue the country's first Islamic bond this year as it works to finance a budget deficit swollen by last year's revolution, a senior Arab banker said on Wednesday.

"The Tunisian government is planning to issue an Islamic sovereign bond before the end of this year," said Adnan Ahmed Yousif, chief executive of Bahrain-based Al Baraka Banking Group, an Islamic banking conglomerate with operations across North Africa.

"They're very serious about it and are now in talks with banks. It will be Tunisia's first sovereign sukuk," Yousif, also chairman of the Beirut-based Union of Arab Banks, an industry association, told Reuters.

Al Baraka Bank has branches in Tunisia and is consulting with the government on Islamic finance. Tunisian finance ministry officials could not be reached for comment.

Before last year's uprisings in North Africa, authoritarian governments restricted or refused to promote Islamic finance for political reasons. In the wake of the regime changes, growth in the industry is expected to accelerate.

A moderate Islamist party now dominates Tunisia's government, which expects its budget deficit to rise to 6 percent of gross domestic product in 2012 from an estimated 4.5 percent for 2011 as it boosts spending to revitalise the economy after the turmoil of the revolution.

A sukuk issue could allow Tunisia to tap a pool of billions of dollars of Islamic investment funds in the wealthy Arab Gulf.

"I believe Tunisia has the potential to become the Islamic finance hub for Africa. It's working towards having all the requirements needed for that," Yousif said.

The Egyptian government is preparing to raise about $2 billion through its first issue of Islamic bonds, Sheikh Hussein Hamed Hassan, an Islamic scholar familiar with its planning, told Reuters this month.
(ReutersAfrica,29 Feb2012)

Alfalah Consulting - Kuala Lumpur:
Islamic Investment Malaysia:

Latest Posts

Upcoming Events on Islamic Finance, Wealth Management, Business, Management, Motivational

Alfalah Consulting's facebook


Alfalah Consulting is NOT providing any kind of loan to finance project etc and asking for a fee. If you've received any email claiming to be from Alfalah Consulting, offering loan to you, please ignore it or inform us for further actions. Our official email is If you've received an email from, that's NOT from us. Be cautious!