Bank Islam eyes new role in developing wakaf land

Bank Islam Malaysia Bhd may indirectly become a property developer as it explores the prospect of developing wakaf land into property projects.

It is in talks with various Islamic religious and economic agencies, such as Yayasan Wakaf Malaysia, on developing wakaf land nationwide.

Group managing director Datuk Seri Zukri Samat said that instead of just providing the financing, the bank could also become joint project owner.

"We will play a key role in the development of wakaf land in the country. While being a lender, we may also go a step further to becoming joint project owner."

Zukri was speaking at a press conference after the opening of Bank Islam's 95th branch in Kota Damansara, Selangor, yesterday.
Bank Islam has already invested in its first wakaf land venture in Kuala Lumpur, although neither as a joint project owner nor a developer.

Instead, the bank will be the anchor tenant of a 34-storey building in the "Golden Triangle" now being developed by its parent, Lembaga Tabung Haji.

The pilgrimage fund, which owns 52 per cent of Bank Islam through the latter's holding company, BIMB Holdings Bhd, is developing the RM151 million building on 0.48ha of wakaf land.

The land belongs to the Federal Territory Religious Affairs Council.

Construction works on the land along Jalan Perak, off Jalan P. Ramlee, started in 2007 and the building itself is expected to be ready next year.

Meanwhile, Zukri said that Dubai Investment Group, which owns

about one-third of Bank Islam, may sell its stake if it receives a good offer. He declined to elaborate.

He also said that Bank Islam plans to open at least 10 more branches next year, which will swell its banking network to more than 100 branches.

The sites for six new branches have been identified and they include Alor Star in Kedah, Bukit Jelutong in Selangor and Sri Petaling, Kuala Lumpur. Each branch should cost around RM600,000 to set up.

Zukri was optimistic that Bank Islam would again achieve double-digit growth next year given the encouraging trend it has seen since last month.

The bank expects its deposits and lending to grow substantially next year.

Bank Islam will soon change its financial year-end to December 31 from June 30 to be in line with Tabung Haji's financial year.

By Business Times (by Zuraimi Abdullah)