Singapore's Islamic finance potential yet to be fully realised: MAS

But the sector expanded over 2012.

Speaking at the 4th World Islamic Banking Summit 2013, Minister for Trade and Industry and Deputy Chairman of the Monetary Authority of Singapore Mr Lim Hng Kiang said that Islamic financial activities in Singapore have continued to expand over the past year.

He noted that Middle East banks based in Singapore have started offering Islamic window facilities for their corporate clients.

"Recently, Singapore-listed shipping company Atlantic Navigation, which has operations in GCC and India, signed an Islamic financing facility with a Singapore-based bank to further its business activities.Home-grown Mustafa Group is also considering an Islamic financing facility to fund its expansion into neighbouring countries, " he said.

He also cited Securus Fund, based and jointly managed in Singapore by Keppel Data Centre Investment Management and AEP Investment Management, which has completed its second round of fund raising acitivity early in 2013. It has also doubled its capital to about US$200m.

Amidst these financial achievenments, the Minister noted that more actions are needed to be done.

"The potential for Islamic finance in Singapore has yet to be fully realised, and that Singapore can play a role in giving growth of cross-border Islamic financing an even greater push.

Towards this end, MAS is presently working with other government agencies and the industry to identify and address time-to market issues to further facilitate Islamic finance activities in Singapore.

This includes looking into providing greater clarity and certainty in the regulatory and tax treatment to expedite the issuance of sukuk and other Islamic capital market instruments," he added.