Announcements from the stock exchanges of Indonesia and Malaysia, as well as the Channel Islands this week are welcome signals for the cross border development of the Islamic Capital markets.
The World Sharia Stock Market Centre, to be developed by the Indonesian Stock Exchange (IDX) and Bursa Malaysia aims to establish a global benchmark for Islamic capital markets with the aim of launching sharia bonds, financial securities products and other sharia-compliant products within six months.
Whilst the development such products is unlikely to deliver much which is new, the importance of the announcement is more relevant to the development of cross border Islamic financial capital markets activity and will do much to boost regional Islamic financial hubs in Jakarta and Kuala Lumpur.
At the signing of the MoU at the 12th World Islamic Economic Forum (WIEF) in Jakarta, Tito Sulistio, President Director of the IDX, stated that both Southeast Asian nations should combine their strengths in order to become the globe’s center for Islamic financial markets.
Later in the week, the Channel Islands Securities Exchange (CISE) announced it is looking to capitalise on a renewed interest in Islamic finance listings. The exchange is already home to an innovative listing combining Insurance Linked Securities (ILS) with sukuk. The CISE stated it had recently seen more enquiries about Islamic finance listings and is taking steps to capitalise on the renewed interest.
IslamicFinance.com lists on its homepage a number of products including equities which are certified as Sharia compliant. The number of Islamic equities remains small and are certified compliant based on industry qualitative and Quantitative filters.