Islamic Banking
Reuters to help boost Malaysia's Islamic financial sector
By Business Times
Apr 2, 2007, 11:50

Reuters to help boost Malaysia's Islamic financial sector

By Rupa Damodaran
rupabanerji@nstp.com.my

April 2 2007

FINANCIAL data and news provider Reuters is confident that it can help develop Malaysia's Islamic financial sector into one that is more sophisticated and hooked up with the global financial market.

Reuters Asia managing director Alex Hungate believes it can do so through interaction with the market participants ranging from regulators, primary issuers of sukuk bonds as well as the buyers and brokers of the secondary market.

"Although Malaysia has a great story to tell because of its push to become a centre for the Islamic finance world, it is not getting its fair share of investments.

"A lot of growth here is coming from domestic investments, and not yet by the kind of wholesale international investment patterns you expect. Maybe Malaysia is not getting its story out effectively, about the role it can play in Islamic finance," he told Business Times.

Best known as the world's largest international multimedia news agency, Reuters' revenue is mostly from its financial services business, including a dealing system that transacts more than half a trillion dollars in forex daily.

Hungate said apart from its news coverage, Reuters provides pricing from local markets and make them available to 400,000 financial market professionals around the world to evaluate potential investments.

"We have been focused on doing that for Malaysia and this is already bearing fruit from the large number of contributors in Malaysia giving their sukuk pricing," he said, adding that this has enhanced its coverage of Islamic finance in Malaysia, Indonesia and the Gulf States.

Reuters' range of products include the Reuters Trading for Exchange, an electronic trading capability for professionals dealing in exchange traded markets, which has already gone live in Europe, the Middle East and Africa.

Reuters 3000 Xtra gives users a commanding view of the global real-time financial arena and provides a combination of news, information and insight as well as access to the global Reuters trading community.

Reuters has the largest foreign exchange community with 112,000 foreign exchange professionals across 125 countries relying on the company's news and information.

Reuters Trading for Fixed Income, a new electronic trading capability which allows banks and financial institutions to trade fixed income securities over their desktop, is also expected to roll out in Malaysia once it gets approval from the Malaysian regulators.

In Malaysia, Reuters is regarded as the official calculator for Bank Negara Malaysia's reference rate, the Klibor and murabahah rates for the 12 banks in the country.

Asia contributes 18 per cent of the Reuters group's revenue, in line with Asia's share of the world capital market.

"That trend will continue as the Asian financial markets grow together with the rapid growth of the Asian economies led by China, India and Japan as well as countries like Malaysia," he said.

Reuters Malaysia has 50 staff compared with other bigger offices in Singapore (800) and Thailand (1,000).

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