Bank Islam Malaysia to build integrated risk framework on Kamakura risk management platform

Kamakura Corporation has completed an agreement to implement the Kamakura Corporation suite of solutions for Bank Islam Malaysia for its balance sheet management, funds transfer pricing, and liquidity management processes.

The project will involve the complete implementation of the balance sheet management and funds transfer pricing solutions and followed a comprehensive evaluation exercise involving a complete proof of concept. Dr Clement Ooi, EVP and Managing Director, Asia-Pacific Operations, Kamakura Corporation stated, "Bank Islam had a very clear understanding of its risk management and liquidity compliance needs. The vendor selection process had an extensive testing routine, and the Kamakura suite of solutions was an apt fit.

"Bank Islam not only has a range of intriguing products, but also a transaction volume that necessitated in them seeking a modular and integrated solution. The project will provide the bank with accurate assessment of transaction cashflows that can then be used for gap, duration, and mismatch management, as well as an accurate assessment of the margins associated with the transaction. All of these can be modelled based on different market conditions implying that the bank is prepared for any adverse movements in market conditions."

Dr Ooi said the Kamakura platform will be the basis for the bank's integrated risk framework. "The bank will be one of the first to be able to generate both historical and forward-looking views of the balance sheet, a transaction-level understanding of the profit margins and a good appreciation of customer, product, business unit, and organisational profit and value dynamics," he said.

Martin Zorn, President and COO for Kamakura Corporation said, "The successful implementation of the balance sheet management, funds transfer pricing, and liquidity compliance project in Bank Islam is a clear indicator that banks are no longer looking for fragmented solutions for risk and compliance, but seek to adopt a customised framework that allows for the repeated use of data loaded once for various aspects of risk and compliance. It is a testimony to the credentials of Kamakura's subject matter experts.

"Kamakura is well-positioned to meet the burgeoning regulatory demands imposed on financial institutions in the region and has the wherewithal to keep pace with regulation; as a matter of fact, what is currently being introduced as risk regulation has been available in Kamakura Risk Manager for the past 10 years."

Bank Islam, the first shari'ah-based banking institution in Southeast Asia, was established primarily to assist the financial needs of Malaysia's Muslim population, and has since extended its services to the broader non-Muslim population fulfilling its Banking-for-All principle. It provided technical assistance in the setting up of several Islamic institutions in the Asian region such as Indonesia, Thailand and Sri Lanka.

The bank offers 70 Islamic banking products and services to more than 5 million customers. Bank Islam's network in Malaysia consists of 147 branches and more than 1,200 self-service terminals. Primarily a retail bank with consumer banking constituting more than 70% of total financing, Bank Islam's list of products ranges from the traditional financing, savings and investment solutions for individual customers, to banking and financial solutions designed to fulfil the fast-changing financial needs of customers from all categories including those related to micro financing, wealth management, capital market, and treasury.

Bank Islam partners with Cognizant for digital Islamic banking

Bank Islam Malaysia today announced a strategic collaboration with Cognizant, a global business and technology consulting firm, to lay the foundation of digital banking across the Bank’s entire network. 

The agreement was signed by Khairul Kamarudin, CEO, Bank Islam, and Effendi Azmi Hashim, Malaysia Business Leader, Cognizant, in Kuala Lumpur, Malaysia. "Bank Islam will continue applying digital technology to our products and services, bringing greater accessibility to our customers, as well as simplifying and improving their banking experience with us,” said Khairul.

By capitalising on digital technologies, Bank Islam will be able to transform Islamic banking as envisioned by Bank Negara Malaysia. Cognizant’s Head of Asia-Pacific, Jayajyoti Sengupta said: “For banks of the new digital economy, leadership is about delivering hyper-personalised products, services, and experiences to customers across channels by continually turning digital data into actionable insights. We are proud to be a part of Bank Islam’s vision to transform itself into a digitally-led bank of the future.

“By leveraging our extensive consulting and digital banking capabilities, we look forward to creating a business, operating and technology roadmap for Bank Islam to realise the full promise of digital in driving greater customer satisfaction and differentiated growth. The opportunity to partner with a leading financial services institution such as Bank Islam marks an important milestone in our growth journey in Malaysia.”

Bank Islam has always strived to design innovative solutions to transform customer experience. By partnering with Cognizant to build a digital bank, the bank is taking a big leap into the future to deliver innovative solutions to small and medium sized enterprises and customers across country, and integrate them seamlessly into the developing digital economy in Malaysia. 

Digitalisation will help Bank Islam accelerate SME banking by providing business solutions for their operational as well as expansion needs. It will enable the bank to rapidly tap the rural, underbanked segments and boost financial inclusion by overcoming cost and physical barriers. Bank Islam will be able to combine its energy, continuous innovation and imagination of fintech startups with its solid balance sheet, trust, customer service and banking expertise. 

Bank Islam Malaysia was established in 1983 as the nation’s first Islamic bank. To date, the bank has a network of 147 branches and more than 1,200 self-service terminals nationwide. To meet the diversity of the public’s financial needs, Bank Islam offers more than 70 shari'ah-based banking products and services.

BankIslami Pakistan goes live with the PCS Java version 14

Path Solutions, a provider of Islamic banking software solutions, has successfully upgraded the iMAL*ProfitCalculationSystem at BankIslami Pakistan to Java version 14. BankIslami was the first bank to receive an Islamic banking license under the Islamic Banking Policy of 2003 from the State Bank of Pakistan. It has a network of 317 branches in 93 cities offering a full range of shari'ah-compliant financial products.

Syed Ata Hussain, Head of Information System, BankIslami said, "Armed with a solid implementation methodology and supported by a team of skilled and passionate consultants, Path Solutions was able to fulfill its commitment, and we were able to run the first successful PCS in Java version 14 in Pakistan. 

"We consider this implementation as a major milestone, as the course of the project involved exhaustive upgrade, internal testing phases, multiple user acceptance testing (UAT) cycles and three full scale application testing exercises to ensure uninterrupted business operations following the upgrade. Once again, Path Solutions was up to the challenge and we upgraded successfully owing to the tireless efforts of all teams involved.” 

The PCS upgrade is pivotal for BankIslami, which merged last year with KASB Bank and migrated more than 100 KASB branches to the iMAL Islamic Banking & Investment System. BankIslami needed several modifications to the software to broaden its operations spectrum in compliance with Central Bank regulations. 

The latest iMAL*ProfitCalculationSystem module is a Web-based application and can be implemented either on the Oracle or Sybase relational database management system. It supports all major browsers and may be deployed on any JEE Web/Application Server Apache Tomcat, Oracle WebLogic and similar platforms. The module's features include built-in control procedures and compliance with Islamic shari'ah, limits monitoring and exposure control, as well as credit risk measurement and evaluation.

According to Path Solutions, over 100 Islamic financial institutions are using its iMAL system.