IFSB’s 6th Legal Seminar on Innovation in Sukūk Securitisation and Islamic Hedging Instruments: Developments and Challenges

Bandar Seri Begawan, 25 March 2014 – The Islamic Financial Services Board (IFSB) is organising the 6^th IFSB Seminar on Legal Issues in the Islamic Financial Services Industry (IFSI), themed, Innovation in Sukūk Securitisation and Islamic Hedging Instruments: Developments and Challenges today in Bandar Seri Begawan, Brunei Darussalam. This Seminar is organised in conjunction with the IFSB Annual Meetings and Side Events 2014, hosted by the Autoriti Monetari Brunei Darussalam (AMBD).

The Islamic financial services industry has developed significantly over the past decade in terms of sophistication in product structures and development of risk management tools, including hedging products. Islamic capital markets have also grown with the emergence of securitisation transactions predominantly driven by Sukūk markets, with Islamic hedging instruments also demonstrating an emerging trend. Coupled with the issuance of some international standards for Islamic hedging instruments in recent years, the Islamic hedging market faces new challenges in the wake of global regulatory reforms related to the requirements of central counterparties and exchange traded transactions.

A noteworthy feature of the developments in asset securitisation and hedging instruments in Islamic finance is the progress on the issuance of new laws and statutes dealing with Islamic capital markets including its sophisticated instruments. The current innovations of these Islamic instruments necessitate a focus on accompanying changes in legal systems and enhanced Sharī`ah compliance reviews in order to reduce uncertainty and boost flexibility in the product offering. The approaches to structuring and offering Islamic products vary significantly across jurisdictions depending on their governing laws. The challenge for these legal systems in different jurisdictions is to act in an accommodative and flexible way so that this process of innovation and improvements can be facilitated, while maintaining compliance with Sharī`ah rules and principles.

The Keynote Address will be delivered by Dato’ Dr Nik Ramlah Mahmood, Deputy Chief Executive, Securities Commission Malaysia. Meanwhile, other confirmed chairpersons and speakers include:

1. Jaseem Ahmed, Secretary-General, IFSB
2. Rosdi Amin Yaakub, Deputy Managing Director (Monetary & Corporate Services and Development), Autoriti Monetari Brunei Darussalam
3. Professor Dr. Necdet Sensoy, Board Member, Central Bank of the Republic of Turkey
4. Dr. Bashir Umar Aliyu, Advisor to the Governor, Central Bank of Nigeria
5. Muhd Jamil Abas bin Abdul ‘Ali @ James Chiew, Legal Adviser, Abrahams, Davidson & Co., Brunei Darussalam
6. Gopal Sundaram, Partner, Abdullah Chan Advocates & Solicitors, Malaysia
7. Habib Motani, Partner, Clifford Chance LLP, United Kingdom
8. Madzlan Mohd Hussain, Partner/Head, Zaid Ibrahim & Co., Malaysia
9. Robin Cheok, Partner, Cheok Advocates & Solicitors, Brunei Darussalam
10. Yeo Wico, Partner, Allen & Gledhill LLP, Singapore
11. Dr. Peter Werner, Senior Director, International Swaps & Derivatives Association, United Kingdom
12. Syed Alwi bin Syed Abdillah Alkaff, Assistant General Manager, Corporate Finance and Advisory , Bank Islam Brunei Darussalam, Brunei Darussalam
13. Assoc. Prof. Dr. Abu Umar Faruq Ahmad, Senior Researcher, International Shari’ah Research Academy, Malaysia
14. Dr. Noor Suhaida Kasri, Researcher, International Shari’ah Research Academy, Malaysia

Topics of discussion for the Seminar include:

• Asset securitisation and Sukūk structuring
• Growth of Islamic hedging instruments: Legal issues and challenges
• Role of institutional and central Sharī`ah Boards in structuring of Sukūk and Islamic hedging instruments

Over 150 delegates from among IFSB members and non-members, including representatives from the financial services industry and the law sector, academicians and students from Brunei and the Asian region as well as interested members of the public are participating in this IFSB event.

The Seminar will be followed by the IFSB’s 6^th Public Lecture on Financial Policy and Stability on 26 March 2014. The Public Lecture entitled Islamic Moral Economy and Dynamics of the Development of Islamic Financial Services Industry will be delivered by Dr Mehmet Asutay from Durham University, United Kingdom.

These two events will be followed by closed-door meetings and events specifically for the member organisations of the IFSB, as follows:

26 March 2014

• IFSB Meet the Members Lunch and Interactive Session

27 March 2014

• 12^th General Assembly of the IFSB
• 24^th Meeting of the Council of the IFSB
• 9^th Islamic Financial Stability Forum

For more information of these events, please visit www.ifsb.org.