Islamic Finance - Sectors & Offerings

With a complete suite of Islamic financial structures and solutions, effective regulatory standards, a facilitative business environment as well as a Shariah Supervisory Council (SSC), Labuan IBFC is well-positioned to cater to the needs of the global Islamic industry.

Underpinning these innovative structures is Labuan IBFC’s comprehensive infrastructure with dedicated legislations, Shariah governance and fiscal incentives for Shariah-compliant financial transactions providing a facilitative and flexible framework for industry players.

Operating as an Islamic financial entity in Labuan IBFC, means that Shariah compliance is endorsed by the Labuan Financial Services Authority’s SSC comprising leading global Shariah scholars and practitioners. Unlike other similar bodies in other jurisdictions, Labuan IBFC’s SSC takes on a supervisory role, not merely advisory, and hence SSC rulings are able to be used as reference in the court of law.

With this infrastructure, Labuan IBFC has become an innovative bed for Islamic financial products. It is home to the world’s first USD denominated exchangeable sukuk and reinforced Malaysia’s position as the global leader in sukuk issuance.

key highlights

The World’s First Islamic Murabaha financing issued out of Labuan IBFC

The world’s first sovereign Sukuk of US$600m was issued by the Government of Malaysia via Labuan IBFC
First exchangeable equity linked Sukuk worth US$750m launched on Labuan International Financial Exchange (LFX)
Saudi corporate sukuk listed on LFX with US$1bn Sukuk Al-Ijarah
Issuance of USD1.5bn sukuk out of Labuan IBFC
Asia’s first robo-advisory service for Shariah compliant investments is offered via a Labuan-licensed entity

Governing Legislation, Related Guidelines and Circulars

For the latest governing legislation, related guidelines and circulars, please go to labuanfsa.gov.my

Islamic Offerings

Labuan Islamic Banking

Labuan Islamic Investment Banking

Labuan Takaful and Retakaful Business

Labuan Islamic Trust

Labuan Islamic Foundation

Search for Labuan Companies

For company search, please click on the link provided : https://www.lfsacoral.gov.my/reefs/

Find Labuan Banks and Investment Banks here

View List of Banks

FAQs

1. What is Labuan banking?
Labuan banking means the business of receiving deposits on current accounts, deposit accounts, savings accounts, and includes the investment banking business, Labuan financial business, Islamic banking business and such other transactions and terms and conditions as specified by Labuan FSA in any currency including Malaysian Ringgit where permitted by Bank Negara Malaysia.
2. What is investment banking?
Investment banking means the business of providing credit facilities and consultancy and advisory services relating to corporate and investment matters, including making investments on behalf of any person. Other activities include undertaking foreign exchange transactions, interest rate swaps, dealings in derivative instruments or derivative financial instruments or any other similar risk management activities.
3. What is Islamic banking?
Islamic banking is defined as a banking business that is in accordance with Shariah principles.
4. Who may apply for Labuan banking licence?
Organisations that meet the following minimum criteria may apply for a Labuan banking licence:
Must be a bank or financial institution
Possesses a sound track record
Accorded a good credit rating by acceptable rating agencies
Supervised by a competent regulatory authority; and
Conforms to generally accepted standards of international banking practices or the Bank for International Settlements (BIS).
5. What is the minimum working minimum fund for an investment bank?
RM10 million or its equivalent in any other currency.