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00:00Why has it been so challenging why is it difficult to create an Islamic makeup bank. Well a makeup bank simply requires a lot of effort because it's just big. They need to have the right capital. You need to have the right market place in order to do the business in order to give the right. What are we talking about. Well a mega bank. People say must be more than a billion dollar capital or some people think it should be about 5 billion capital at the end of the day. Is it still open to debate. What is really make of it is it is in the form of a bank like HSBC a bank like Citi Bank or is it Goldman Sachs. Is that what we are talking about. To me to me to become a mega bank is just a simple function of business growth. So we're just saying not all the factors are there. The stores have not been aligned yet. No. All right. We need to make sure that all the parameters are there that the pricing is right. There is a merger being considered between two key banks. Right. And you need to have the leadership that is right for the Islamic bank. I mean you have a midwife and bank. If you don't have the right talent to run an even bigger bank. Most Italians that are available in finance the day are running small banks will make a bank be a game changer for Islamic banking. How much of a reach will it give. Islamic banking. When you talk about mega you are having in mind scale with skill. You can be able to be more competitive in the market and really give a run for the money for all the other big things out there. I mean you need to have firepower in order to win mandates. I think I think the skill is that it's not just a matter of having one mega bank. If you take a conventional bank and you do have HSBC you do have Goldman Sachs and you have Citi. So it takes more than just one a Bank Indonesia will need one. Malaysia will need one or maybe a couple. I think we have to aspire to have a mega bank in every country. And and with the mega bank being available in each country the condensed that the Internet will be said there and therefore facilitate and generate more cross-border deals and a mega bank to be successful at the end of the day. You can be you can be huge in your own country right. But the question is can you be a multi country player right. In finance the today most Jews edition just do not have sufficient or effective infrastructure for Islamic finance. So you have a mega bank in Malaysia or Turkey or Indonesia. And we do a lot of business you know one country and then we went to go to another country. We get stuck. The conventional banks or the big conventional banks will not get stuck because they have the infrastructure to support them in order to be relevant in the future. We have to look at disruptive technology. Increasingly we're talking about fintech. How does fintech fit into Islamic banking. Our conversations being held to ensure that we embrace fintech within the industry. Well Fintech is definitely being embraced by Islamic finance. We have the conference today talking about fintech shockingly isn't enough. Well talk is definitely not you. And definitely we have to do it. So we need to have some of the FinTech companies that are already there to start looking at actually doing Islamic finance and we did India technology right. And to have this fintech companies work hand-in-hand with Islamic banks so that we can we can cross fertilise both activities. You're a veteran in the Islamic banking world. There is a sense that Islamic banking acts like a startup even though it's been in operation for decades . Is that a fair assessment . It is a fair assessment I think. I think we need to leave that shackled behind smash it with my brain and think bigger than what we are than we are right. We need to to try and capture market despite our size. Then we become bigger .

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Why a Megabank Is Important in Islamic Financing

Badlisyah Abdul Ghani, president of Chartered Institute of Islamic Finance Professionals, discusses creating an Islamic megabank, why it's been so difficult and what the megabank could do for the community. He speaks to Bloomberg's Haslinda Amin on "First Up" from the Global Islamic Finance Forum in Kuala Lumpur. (Source: Bloomberg)

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