Angkasa proposes Islamic co-op bank
Written by Chua Sue-Ann Available at: http://www.theedgemalaysia.com/index.php?option=com_content&task=view&id=168969&Itemid=79
KUALA LUMPUR: The National Cooperative Organisation of Malaysia (Angkasa) has submitted its proposal to the government for the establishment of an Islamic cooperative bank and plans to turn some 560 existing credit cooperatives nationwide into sub-branches. Angkasa president Datuk Dr Mohd Ali Baharum handed the proposal to Domestic Trade, Cooperative and Consumerism Minister Datuk Seri Ismail Sabri Yaakob after a meeting in parliament on Wednesday, June 30.
Speaking about the proposed cooperative bank at a press conference afterwards, Mohd Ali said Angkasa aimed to set up at least one bank branch in every state and transform existing credit cooperatives into “sub-branches”. “Angkasa does not want to compete with existing banks but wants to strengthen credit cooperatives,” Mohd Ali said. Angkasa had suggested that the bank be named Islamic Cooperatives Bank of Malaysia, he said. The proposed Islamic cooperative bank would have a paid-up capital of RM400 million, above the RM300 million minimum, Mohd Ali added.
He said Angkasa would prefer the cooperative bank to be established under the Cooperative Commission of Malaysia (CCM), but would leave the final decision to the government and Bank Negara Malaysia (BNM). At the same press conference, Ismail said the government would study Angkasa’s proposals but noted that the establishment of the bank would be subject to the central bank’s regulations.
“We welcome the proposal… the cooperative bank would focus on serving smaller towns and rural areas, currently without banking services, for example, Sarawak’s interior,” Ismail said. “If all goes well, we expect to finalise the details of the proposed Islamic cooperative bank by April 2011 and it should be operational by the middle of next year, subject to BNM regulations.”
Ismail brushed off allegations of mismanagement and malpractices in Angkasa that were raised in the run-up to the cooperative body’s annual general meeting as “internal politicking”. On Jan 8, 2009, Royal Prof Ungku Abdul Aziz stepped down as Angkasa president after helming the body for 37 years, citing disappointment that investigations into alleged misappropriation of funds in the organisation had borne no fruit.
Angkasa (Angkatan Koperasi Kebangsaan Malaysia Bhd in Bahasa Malaysia) was established in 1971 to coordinate the numerous cooperatives in Malaysia. Ismail said the Islamic cooperative bank, if it comes to be, would be the country’s third cooperative bank, joining the country’s largest cooperative bank Bank Kerjasama Rakyat Malaysia Bhd (Bank Rakyat) and the Cooperative Union Bank (Koperasi Bank Persatuan Malaysia Bhd, formerly Province Wellesley Cooperative Banking Union Ltd). The minister however declined to elaborate on the union-based bank, saying more details would be announced at a later date.
University of Glasgow, Scotland