CIMB Islamic, the Islamic banking arm of Malaysia's second largest bank, CIMB Group, has launched its first Shariah-compliant product in Hong Kong.
Commodity Murabahah Deposit, which will initially be sold by Hong Leong Bank, is not a structured product, but aims to replicate a cash deposit. However, industry experts believe CIMB could begin to offer structured deposits for Islamic investors in the future. CIMB is a prolific structured products issuer in Malaysia and the Middle East.
The product will use commodities, such as crude palm oil, metal and other tradable commodities as its underlying asset. CIMB Islamic chief executive officer Badlisyah Abdul Ghani said the Hong Kong Monetary Authority (HKMA) gave its clearance last week.
"It is important for CIMB Islamic to be here, because Hong Kong has great potential as an Islamic financial market," he told local journalists.