Strategic Management from an Islamic Perspective: Text and Cases

Chapter 12

Case 3: Bank Muamalata

Zabeda’s Report

Zabeda was uncomfortable. As a postagraduate student writing her thesis, she always felt nervous when she presented her work to her supervisor. Her thesis was a case study of Bank Muamalat, one of Malaysia’s smallest Islamic banks. She had compiled all the information that she could find in the library and on the Internet, and she now watched nervously as her supervisor read her report.

Historically, Islamic banking took off with the introduction of the Islamic Development Bank in Jeddah, Saudi Arabia, in 1970. In 1974, the Islamic Bank of Dubai became the first bank to be launched. In Malaysia, the national steering committee on Islamic banking was established in July 1980, and the establishment of the Bank Islam Malaysia Berhad followed in 1983. In 1993, commercial banks, merchant banks, and finance companies were allowed to offer Islamic banking products and services under the Islamic banking scheme.

The Beginning of Bank Muamalat

Bank Muamalat, which started operation on October 1, 1999, is a full-fledged Islamic financial institution that operates under the Islamic Banking Act (1983). It is headquartered in Kuala Lumpur and is a leading financial institution offering shariah-based financial services and products. Bank Muamalat Malaysia Berhad (BMMB) was the second full-fledged Islamic bank to be established in Malaysia. Its mandate is to provide shariah-compliant banking products and services to Malaysians, irrespective of ...