Guidance Invt seeks Islamic fund licence in Malaysia

The Paris-based Guidance Investments has been in Malaysia for the last seven years and obtaining the licence would allow it to expand its reach.

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Kuala Lumpur: Guidance Investments (GI), which is headquartered in Paris, is applying for an Islamic fund management licence from the Securities Commission as it plans to make Kuala Lumpur its regional hub by the year-end. Banking on the trillion dollars worth of Islamic finance business worldwide and the supportive role of the Malaysian government for this industry, it is targeting to grow its business to US$5 billion (RM14.9 billion) in the next 10 years. The firm, a member company of Guidance Financial Group which is owned by Syrian and Lebanese investors, has been in Malaysia for the last seven years and obtaining the licence would allow it to expand and accelerate its reach even further. GI managing director Dr Hasnita Hashim said its presence all this while in Malaysia has been quite off-the-radar and having the licence would be a boost. "We have been identifying opportunities and we had launched a few funds during that time," she said in an interview with Business Times here recently. Hasnita said GI, in partnership with ING Real Estate, had in 2006 created the first Islamic China real estate fund called Guidance China Opportunity Fund to invest in Asian real estate. "We have been mobilising money from the Middle East to this part of the world but in a low-profile way. We are also backed by our international track record for the last 10 years where we have raised about US$750 million (RM2.2 billion) from over 30 investors." The Guidance Financial Group, which was set up in 2000, has close relationship with over 200 investors worldwide. The US was its first market and to date, it has done more than US$2 billion (RM5.9 billion) worth of business there, particularly in mortgage financing. It also has presence in Saudi Arabia, the United Arab Emirates and Europe. Its administrative office is in Geneva but will eventually be moved here. Hasnita said if previously the KL office was a mere branch office which supported the group's international business, "but once we get our licence, our activities here will be more of an operational one and our presence will be felt more". She said within a year after it gets the licence, GI has plans to form an alliance with a strategic local partner and expand the business. It is already in talks with several parties. "We are not trying to do anything different. We just want to do the business we have done in the last 10 years and put it under the Malaysian flag." First on its plate upon obtaining the licence, she said, would be to do product origination for real estate as there is a demand for such product among its investors. "Then, we will launch leasing and fixed-income funds," said Hasnita, adding that in areas GI has no specific expertise, it is keen to develop alliances with other team of experts. Hasnina pointed out that Malaysia was a natural choice for GI's expansion due to the supportive government and the incentives it offers to spur the growth of the Islamic finance industry. "In other countries like the US, there is no such support, but we managed to do well there. So, imagine being in a country like here and the prospects in store for players like us."