Malaysia may issue more Islamic bank licences to foreigners, central bank chief Zeti Akhtar Aziz said on Tuesday. "We are not ruling out that option. But for the current environment it will remain at three," Zeti said when asked if the central bank would issue more such licences to foreigners.
"We will see how the situation develops," she told reporters after launching the Islamic banking unit of Hong Leong Bank.
The government recently licensed three foreign Islamic banks and allowed existing lenders to set up separate Islamic banks. Malaysia wants to double Islamic banking's share of total bank assets to 20 percent by 2010. The three licences were awarded to Kuwait Finance House, Al Rajhi Banking and Investment Corp, Saudi Arabia's largest listed bank, and a consortium comprising Qatar Islamic Bank, RUSD Investment Bank Inc and Kuwait's Global Investment House.
Kuwait Finance House has said it planned to start its Malaysian operations this year.
Foreigners can also buy up to 49 percent of investment banks. New licences for foreign banks are due to be issued in 2007.