This document discusses Islamic finance in Malaysia. It provides information on the growth of Islamic finance since 1963 with the establishment of institutions like Tabung Haji and Bank Islam Malaysia. It describes the functions of key institutions like Bank Negara Malaysia, the central bank that regulates the country's financial system, and the Syariah Council that endorses Islamic products. It also mentions other Islamic organizations in Malaysia that support the development and administration of Islamic affairs.

1. BPMS 6023
Muamalat
Management
Mohammad Zuhadi Shamsuddin (822416)
Hafizullah Mohd Amin (822481)
Md. Zulkeflee Shah Omar (817252)
NofriYanti (820809)
Open

2. Islamic Finance in Malaysia
• Islamic finance system in Malaysia
• The function of Bank Negara Malaysia
• The function of Syariah Council
Open

3. Islamic finance system in Malaysia
• The Islamic financial system in Malaysia has witnessed a tremendous
growth in demand, acceptance and development since its introduction in
1963.
• Three major industries in the Islamic banking and finance fraternity,
being: (i) Islamic banking and finance; (ii) takaful; and (iii) Islamic
securities.
• It began with the establishment of the Malaysian Pilgrims Fund Board
(Tabung Haji) and the country’s first Islamic bank, Bank Islam Malaysia
Berhad (BIMB), which began operations on 1 July 1983.
• Since then, BIMB has become the core component of Malaysia’s Islamic
financial system.
Open

4. Objective
• The ultimate goal of the Malaysian Islamic financial model is to
operate in parallel with Malaysia's conventional financial system.
• To achieve this, the Islamic financial system presents itself as a
viable alternative to the more established, conventional system.
Open

5. The function of Bank Negara Malaysia
• Established on 26 January 1959 as Bank NegaraTanah Melayu,
wholly owned by the Government of Malaysia, reports to the
Malaysian Minister of Finance
• Main purpose is to maintain the stability of the financial system
,issue currency, act as banker and adviser to the Government of
Malaysia and regulate the country's financial institutions, credit
system and monetary policy.
Open
• The bank is endowed with certain powers
through establishment of legal Acts by
the Parliament of Malaysia to help fulfill its
objectives.

6. The function of Bank Negara Malaysia
Open
Central Bank of
Malaysia Act 2009
Financial Services
Act 2013
Islamic Financial
Services Act 2013
Money Services
Business Act 2011
Anti-Money
Laundering and
Anti-Terrorism
Financing Act 2001
Development
Financial
Institutions Act
2002

7. The function of Syariah Council
• The Shariah Advisory Council of Bank Negara Malaysia (SAC) was
established in May 1997 as the highest Shariah authority in Islamic
finance in Malaysia.
• The SAC has been given the authority for the ascertainment of
Islamic law for the purposes of Islamic banking business, takaful
business, Islamic financial business, Islamic development financial
business, or any other business, which is based on Shariah
principles and is supervised and regulated by Bank Negara
Malaysia.
Open

8. The function of Syariah Council
• As the reference body and advisor to Bank Negara Malaysia on
Shariah matters, the SAC is also responsible for validating all
Islamic banking and takaful products to ensure their compatibility
with the Shariah principles.
• SAC advises Bank Negara Malaysia on any Shariah issue relating to
Islamic financial business or transactions of Bank Negara Malaysia
as well as other related entities.
Open

9. The function of Syariah Council
Open
Endorse Shariah policies and procedures prepared by Bank
Endorse and validate relevant documentations
Assess work carried out by Shariah review and Shariah audit
Assist related parties on Shariah matters
Provide Written Shariah Opinions
Provide the Bank with guidelines and advice on religious matters
Make decisions on matters arising from existing and future activities of the Bank which have religious
repercussions
The Shariah Committee shall ensure the quality and consistency of the Shariah decisions

10. Islamic Institutions in Malaysia
• Tabung Haji Malaysia
• JAKIM, ILIM
• State Islamic Religious Affairs
• Syariah Court
Open

11. Tabung Haji
• LembagaTabung Haji (TH) is the premiere Islamic financial
institution in Malaysia established in 1963.
• TH has more than 50 years of experience in deposits, Hajj services
& operations and investments.
• Being the country’s largest Islamic fund manager with more than
RM62 billion funds,TH endeavours to strengthen the economy of
the Malaysian Muslims by capitalizing on its available funds and
resources.
• Net profit of almost RM3 billion
Open

12. Tabung Haji
• Focuses on providing excellent and satisfactorily hajj services to
Malaysian pilgrims
• Has served as a role model of innovative hajj management and
Islamic financial services by most Islamic countries in the world.
• Venturing into several investment sectors in accordance with
Islamic principles such as plantation, property development and
construction, Islamic finance, information technology, oil and gas
and hospitality.
Open

13. JAKIM
Open
The Islamic Development Department of Malaysia, the Prime
Minister's Department will act as the central agency in the planning
of Islamic Affairs and the development of the ummah.
Objective
- Ensuring IslamicTeaching is Spreading to the Community
- Developing Competitive Leadership and CreatingTrained, Competent,
Dedicated andWisdom Management Staff
- ProduceValue-Based Management and Islamic Ethics

14. JAKIM
Open
As a leading agency of Islamic affairs management at the federal
level as well as the secretariat to the National Council for Islamic
Religious Affairs Malaysia (MKI), JAKIM implements the following
three main functions:
• Drafting and Standardization of Islamic Law
• Coordination of Islamic Administration
• Coordination and Development of Islamic Education

15. ILIM
Open
The Malaysian Institute of IslamicTraining (ILIM) is the institute
responsible for providing courses, seminars and training to Islamic
Affairs Service Officers from Islamic religious agencies throughout
Malaysia. However, the offer is also open to officials and staff from
various government departments who are interested.
Vision
To become a global Islamic LeadershipTraining.

16. ILIM
Open
Mission
Driving theTransformation of Islamic Affairs Management to Enhance the
NationalValueThrough Innovative and Strategic Islamic Agency Empowerment
Objective
Producing officials and staff of Islamic affairs management and civil servants
who are taqwa, competent and challenged to face the challenges.

17. State Islamic Religious Affairs
Open
MAIS MAIP MAINS
MAIWP MAIK MAIJ

18. Syariah Court
• Refer to Sharia law in Islamic religious law and deals with
exclusively Islamic laws, having jurisdiction upon every Muslim in
Malaysia.
• The Syariah Court system is one of the two separate system of
courts which exists in Malaysian legal system.
• There is a parallel system of state Syariah Court, which has limited
jurisdiction over matters of state Islamic law (Shariah).
• The Syariah Courts have jurisdiction only over Muslim in the
matters of family law and religious observances, and can generally
only pass sentences of not more than three years imprisonment, a
fine of up to RM5,000, and/or up to six strokes of the cane.
Open

19. Syariah Court
• Article 145 of the constitution says the Attorney General of
Malaysia has no power over matters related to the Sharia courts.
• There are three levels of the courts: Appeal, High and Subordinate.
• Unlike the civil courts in Malaysia, which is a federalised court
system, the Syariah Court is primarily established out of state law.
• Similarly syariah or Islamic law is a matter of state law, with the
exception of the FederalTerritories of Malaysia.
• Thus syariah law in one state might differ to that of another state.
There are 13 state syariah law departments and 1 syariah law
department for the FederalTerritories.
Open

20. Reference
• http://www.bnm.gov.my
• https://en.wikipedia.org/wiki/Bank_Negara_Malaysia
• https://en.wikipedia.org/wiki/Islamic_finance_in_Malaysia
• http://www.islam.gov.my
• http://www.tabunghaji.gov.my
• http://www.esyariah.gov.my
• http://www.jais.gov.my
Open