M'sia courts need experts on syariah finance
Thursday, October 30, 2008
MALAYSIAN courts may need to refer to the central bank's syariah advisers when deciding Islamic finance matters to ensure cases are handled by syariah experts, a newspaper reported yesterday.
Islamic banking matters are heard by Malaysian civil courts which are staffed by judges who are not formally trained in syariah. This has led to criticism that some syariah finance cases may not be decided according to Islamic principles.
"It is learnt that the central bank is reviewing the necessary laws to make this possible," The Malaysian Reserve said, without citing the source of its information.
There was no immediate comment from the central bank.
The central bank has a board of syariah advisers which gives directions on Islamic finance matters regulated by the central bank such as banking and insurance. The board consists of syariah scholars, jurists and industry practitioners. Syariah-compliant finance bans the receipt of interest and investments in companies dealing in alcohol, gambling and pornography.
Meanwhile, Malaysia's central bank yesterday aborted tenders for its Islamic and conventional monetary notes, saying there was not enough demand from investors.
Bank Negara said it cancelled the tenders after receiving "unfavourable rates" for the notes, which both have maturities of less than a year. It did not elaborate.
Unlike government bond issues, monetary notes are used for liquidity management. If the central bank does not get favourable rates from the market for the notes, it may opt for other instruments to manage liquidity.Reuters
Islamic banking matters are heard by Malaysian civil courts which are staffed by judges who are not formally trained in syariah. This has led to criticism that some syariah finance cases may not be decided according to Islamic principles.
"It is learnt that the central bank is reviewing the necessary laws to make this possible," The Malaysian Reserve said, without citing the source of its information.
There was no immediate comment from the central bank.
The central bank has a board of syariah advisers which gives directions on Islamic finance matters regulated by the central bank such as banking and insurance. The board consists of syariah scholars, jurists and industry practitioners. Syariah-compliant finance bans the receipt of interest and investments in companies dealing in alcohol, gambling and pornography.
Meanwhile, Malaysia's central bank yesterday aborted tenders for its Islamic and conventional monetary notes, saying there was not enough demand from investors.
Bank Negara said it cancelled the tenders after receiving "unfavourable rates" for the notes, which both have maturities of less than a year. It did not elaborate.
Unlike government bond issues, monetary notes are used for liquidity management. If the central bank does not get favourable rates from the market for the notes, it may opt for other instruments to manage liquidity.Reuters
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