GIFC08: Lively debate on BBA ruling expected

By Habhajan Singh
Islamic bankers can expect a lively discussion on the recent High Court judgment on Al-Bai' Bithaman Ajil (BBA) at the Second Global Islamic Finance Conference (GIFC 2008) that begins today in Kuala Lumpur. Shariah and product development is one of the first sessions for the two-day forum.
In one session, Dr Aznan Hasan, an assistant professor at the International Islamic University Malaysia's (IIUM) Kulliyah of Law, will lead a discussion on ensuring Shariah-compliant Islamic financial instruments.
Recently, High Court judge Justice Datuk Abdul Wahab Patail ruled that since some BBA contracts in the cases heard were structurally faulty, defaulters need not pay more than the original financing amount that they received, depriving banks of the profit they would have otherwise booked from the transactions.
Bankers fear that this judgement could mean that current BBA financing clients would only need to pay the facility amount and escape from paying the profit portion. The forum will also look at sukuk and efforts in promoting its secondary market. It will also touch on Islamic venture capital and private equity.
Among the areas expected to be covered are the opportunities and limitations of Islamic private equity and venture capital investments and ways and means to meet the legal, regulatory and judicial requirements.
Participants will also discuss the limitations to the growth of Islamic private equity and venture capital Ahmad Sanusi Husain, CEO and chief consultant of event organiser GlobalPro Consulting Sdn Bhd, will lead the session on human resources, another area of interest for the Islamic finance sector, especially with the current exodus of talent to the Middle East and other jurisdictions also promoting the sector.
Azmi Mohd Ali, managing partner of legal firm Azmi & Associates, is scheduled to discuss issues related to Islamic venture capital and private equity, where he will touch on the scope for Islamic private equity in mergers and acquisitions. The session will also discuss the oportunities and limitations of Islamic private equity and venture capital investments and ways and means to meet the legal, regulatory and judicial requirements. It will also touch on limitations to growth of Islamic private equity and venture capital.
In another session, Takaful Ikhlas Sdn Bhd executive vice president and chief operating officer Wan Mohd Fadzlullah Wan Abdullah will present a paper on innovation and solutions in takaful. He will discuss the new growth and global market opportunities for takaful and assess recent developments in the global takaful landscape.
On the second day, GIFC 2008 will have a session on risk management and accounting led by Crescent Risk and Wealth Management Consultancy Sdn Bhd managing director Hassan Ahmad and Amanie Business Solutions Sdn Bhd principal consultant Dr Syed Musa Al Habshi.
In the first session, it will look at risk analysis for Islamic banking, concerns about risk and unique risks in Islamic financial services. Dealing with issues on accounting and auditing for Islamic financial institutions, the speakers will inspect the framework for the preparation and presentation of financial statements for Islamic financial institutions and standards locally and internationally.
Minister in the Prime Minister’s Department Datuk Seri Dr Ahmad Zahid bin Hamidi will present the forum's keynote address entitled "Evolution and opportunities in Islamic finance". (By Habhajan Singh, The Malaysian Reserve, Oct 29, 2008, Page 8)