Azmi, Illiayas merger primed for growing Islamic finance

TAPPING the growing Islamic finance sector is a major impetus in the recent merger of local law firms, Azmi & Associates and Illiayas. Besides flexing their muscle with numbers, it is understood that grabbing a bigger slice of Islamic finance work was a key consideration in the merger that was officially announced on April 24 in Kuala Lumpur.

Islamic finance industry officials say that Illiayas has been "pretty successful" in cornering Islamic finance work, including from large corporations and financial institutions, though the firm is moderately small.

Illiayas was established on April 1, 1996 and at its peak had three partners and six support staff specialising in banking, Islamic banking, litigation, insurance and conveyancing, according to a joint press release.

The firm is anchored by Mohamad Illiayas Seyed Ibrahim, a graduate of the National University of Singapore and a lawyer of 20 years standing, specialising in banking, Islamic banking and finance.

His partner, Gurmel Singh, is a litigation lawyer of 15 years standing whose clients include Government-linked corporations (GLCs) and banks.

Azmi & Associates, established on Sept 1, 2000 with 12 lawyers, now has 31 lawyers comprising seven partners, 24 lawyers and 15 trainee solicitors. It provides legal services for the capital & debt market, energy and utility sector and advises on intellectual property, mergers & acquisitions, projects, real estate, venture capital, litigation and dispute resolution.

Their combined strength was seen when both law firms invited their clients to a cocktail party at the Malaysian Petroleum Club at the Kuala Lumpur City Centre last Thursday.

With the merger, Azmi Mohd Ali said he aims to turn the new entity, operating under the name of "Azmi & Associates", into one of the top ten local legal firms and a regional player. Prior to this merger, was the high-profile successful merger between legal firms Lee Hishamuddin and Allen & Gledhill two years ago.

The merged entity of Lee Hishamuddin Allen & Gledhill is now one of the top and preferred law firms in Malaysia. Besides immediately increasing the standing of the combined firm to Tier 2, which makes it amongst the top 10 law firms in Malaysia, the merger is also intended to "make the combined firm renowned in the areas of Islamic banking and finance in the Middle Eastern market".

Increasingly, the firm noted that general counsel are looking for breadth, depth and experience when making hiring decisions.

"This can put small and mid-size firms at a disadvantage in competing for higher level work. This merger is envisioned to provide considerable benefit for Azmi & Associates and Illiayas in striving to advance our position as a top tier-practice," the statement said.

(By Habhajan Singh, The Malaysian Reserve, April 28, 2008)

We are not a threat, says UK regulator

THE Financial Services Authority (FSA), United Kingdom's single financial regulator, does not view its emergence in the area of Islamic finance as a threat to Malaysia's own ambition to become an international hub for the sector.

Each financial centre has its role to play, especially in these formative years of the Islamic finance industry, said Michael Ainley, FSA's head of wholesale and investment firms.

"This is an emerging industry and the growth of Islamic finance across different regions around the world will only help strengthen the industry and enhance its credibility," he told The Malaysian Reserve in an email interview. Ainley, one of the authors of an FSA document entitled Islamic Finance in the UK: Regulation and Challenges, was asked to comment on the view of some quarters that the UK's entry into the sphere of Islamic finance was a threat to Malaysia's aims to become an international hub for Islamic finance On this score, he said.

Malaysia has established expertise in the field and other centres around the world have much to learn from the experiences, noting that the dynamics in each centre is unique and each has something different to offer.

London took a step further in its push to become the leading western financial centre for Islamic banking with the launch last Tuesday of the fifth Islamic bank with a UK licence, reported the Financial Times on April 22.

The report added that Britain is the only European Union country to have licensed Islamic banks. It also sees the development of Islamic finance as a way of building bridges with the two million Muslims who live in the UK.

The UK is also poised to be the first western government to consider floating a sukuk to enable it to attract wealthy Middle Eastern businesses. Last November, the UK Treasury released a consultation document "to seek views on the potential for the government to become an issuer of sterling Islamic financial instruments."

The document noted that in April 2007, the then Economic Secretary to the Treasury announced that the Treasury and the Debt Management Office would carry out the study.

It said the objectives of potential issuance were set out by the then Economic Secretary, when he said: "We are determined to do everything we can to deliver greater opportunities for British Muslims — and also to entrench London as a leading centre for Islamic finance in the world."

Meanwhile, Malaysia is already at the forefront as the world's largest sukuk market with RM213 billion (68.9%) of the global oustanding sukuk as at end-2007 originating from the country.

In its 2007 annual report, Bank Negara Malaysia said total issuances of corporate sukuk in Malaysia amounted to more than RM30 billion last year.

(By Habhajan Singh, The Malaysian Reserve, April 28, 2008)

International Islamic Finance Symposium

The International Islamic University Malaysia (IIUM) will host the two-day International Islamic Finance Symposium (IFES 2008) beginning Apr 28. The event is organised by the IIUM Institute of Islamic Banking and Finance (IIiBF) together with the Islamic Research & Training Institute (IRTI). IIiBF, which officially established in September 2004, is led by director is Associate Professor Dr Ahamed Kameel Mydin Meera.