IDB says Mega Islamic Bank to start with $1bn

Islamic Development Bank, the Jeddah-based multilateral lender, said the Mega Islamic Bank will have an initial paid up capital of $1bn.

Mega Islamic Bank shall provide “liquidity management solutions in an effort to create an Islamic interbank market,” Islamic Development Bank said in an e-mailed statement. The bank will also originate and finance large projects across Muslim countries, IDB said.

Demand for services complying with Shariah is increasing about 15 percent annually and assets under management may almost triple to $2.8 trillion by 2015, according to the Kuala Lumpur based Islamic Financial Services Board, a standards body for the industry.

Nomura International is acting as financial adviser, Norton Rose is the legal adviser and Ernst & Young is consulting on MIB, IDB said.

Malaysia is expected to issue one “mega Islamic bank” licence by the end of the year, central bank Governor Zeti Akhtar Aziz told reporters in Kuala Lumpur on October 27.