The Islamic Bank of Thailand expects to launch Thailand’s first Islamic property fund, worth THB 1.4 billion $47.2 million in December, according to the bank’s President Theerasak Suwannayos.
The fund, called IBank Shariah Property Fund according to the Dow Jones, will invest in an office building with a projected yield of around 5% to 7% per annum.The bank will be the main tenant of the building while the businesses leasing space must comply with the Islamic religion, it said.The Islamic Bank of Thailand was set up under the Islamic Bank of Thailand Act 2002, regulated by the Ministry of Finance and expanded in November 2005 through the acquisition of Shariah Banking Services of Krung Thai Bank Pcl. in November 2005.
With 18 branches the Bank relocated its headquarters to Asoke a prime business area along Bangkok’s Sukhumvit road in August 2005.With a Muslim population of just 4.6 per cent, the fund is likely to tap in to rocketing foreign direct investment in Thailand that has seen record growth in the Thai baht and propelling Thailand into one of the best performing currencies in the region. Islamic finance is estimated to be worth more than USD700 billion and has enjoyed recent growth rates of 15 – 20 per cent.