Chief Executive Officer Maybank Islamic , Muzaffar Hisham visit Paeditric & Congenital Heart Centre (PCHC) and contribute to Norfadzillah Abuzar mother of Sayf Firas Ramadan Sahlan a baby who suffering from heart disease. Maybank Islamic Announces "Cycle Save A Child's Heart 2.0" at National Heart Institute, Kuala Lumpur. Pix by Hafiz Sohaimi
Chief Executive Officer Maybank Islamic , Muzaffar Hisham during interview with the reporter. Maybank Islamic Announces "Cycle Save A Child's Heart 2.0" at National Heart Institute, Kuala Lumpur. Pix by Hafiz Sohaimi

KUALA LUMPUR: While rating agency has mixed views on the performance of the sukuk market this year, Maybank Islamic Bank Bhd says it remains mindful of the challenging economic backdrop.

Its chief executive officer Muzaffar Hashim said the Islamic bond issuance activity, which saw its peak in 2012, is closely tracking the volatile external developments such as Greece debt default risk and US interest rates hike.

US Federal Reserve on Tuesday signalled two possible rate hikes this year, a move which could reduce global liquidity and demand for sukuk. Malaysia holds the lion's share of sukuk issuances globally at between 60 and 70 per cent.

"Whatever the circumstances are, we are ever-ready to face them as we continue to assess each development very closely," he told reporters at a press conference here yesterday.

"There are companies that still tapped the sukuk market this year while some shelved their plans awaiting a much clearer direction. On our part, we do not rush our clients to issue sukuk, rather we advise them according to the market condition and right timing," he added.

The last three years have seen the global sukuk market double, with a compounded annual growth rate of 33 per cent for the previous 10 years, according to reports.

RAM Rating said new global sukuk issuance is expected to be strong this year at around US$100 billion (RM371 billion) to US$120 billion (RM445 billion) while Standard & Poor’s warns of a slowdown in emerging markets as reduced confidence and low oil prices hit investor demand.

Sukuk issuance stood at US$116.4 billion and US$111.3 billion in 2014 and 2013, respectively, after registering a record of US$131 billion in 2012, an increase of 54 per cent from the preceding year.

Muzaffar said Malayan Banking Bhd via its units Maybank Islamic and Maybank Investment Bank will focus on innovations to maintain its leadership position in the sukuk and corporate financial services segments.

Maybank's Islamic's RM1.5 billion recent Basel 111-compliant subordinated Sukuk Murabahah received the 'Leadership Issuer of the Year' award for a financial institution at the Asset Triple ‘A’ Islamic Finance Awards 2015.

It was the single largest deal of its kind launched by an Islamic financial institution.

Meanwhile, the bank said it will organise its second cycling event, Cycle Save a Child's Heart 2.0 on Aug 2, after the success of its inaugural one last year.

This year's venue will be in Ipoh and after that it will move to other cities and towns nationwide as Maybank Islamic aims to make it an annual sporting event.

This initiative, held in collaboration with the National Heart Institute (IJN), targets to raise funds for paediatric patients not only in Malaysia, but also underprivileged children in all Asean countries where Maybank Group is present.

It expects to raise RM100,000 from 2,000 cyclists compared with last year's 1,000 which raised a total of RM50,000.

Under the five-year collaboration with the IJN, Maybank Islamic has to date contributed RM2.55 million to the heart institute, which included the amount raised from last year's event.