In April 2009, the Malaysian government announced further liberalisation measures that included new licences to be offered in Islamic banking and takaful. More specifically, up to two new mega Islamic banking licences will be issued to foreign players withminimum paid up capital of USD1 billion to enhance global interlinkages and leverage on global developments in Islamic finance. Existing domestic Islamic banks that wish to scale up their operations and expand into global markets are also given greater flexibility to enter into strategic partnerships with foreign players to raise their capitalization to USD1 billion with a higher foreign equity limit of up to 70 per cent.

In Malaysia, Labuan is an integrated International Business & Financial Centre (IBFC), offering a wide range of offshore financial products and services to customers worldwide, including banking and investment banking, insurance, captives, trust business, fund management, investment holding, company management and Islamic financing.

Labuan is an island strategically located in the Asia-Pacific region, off the coast of East Malaysia. It is administered by the Federal Government of Malaysia, easily accessible, has a developed infrastructure, satellite telecommunication, political stability, low cost of operation and shares the same time zone with other major Asian cities. Labuan also attributes its success to the Malaysian government’s commitment to develop Labuan to its fullest potential.

Labuan Financial Services Authority (LFSA) has implemented policies that facilitate the creation of a competitive and attractive business environment in Labuan, Malaysia. Malaysia’s legislative framework is not only business-friendly but also prudent to safeguard Labuan’s international image as a clean and reputable offshore financial centre.

LFSA, a one-stop agency was established in 1996 to:

•	Focus on business development and promotion
•	Process application and supervise offshore activities
•	Develop national objectives, policies and set priorities
•	Administer and enforce legislation
•	Incorporate/register offshore companies

LFSA has implemented policies that facilitate the creation of a competitive and attractive business environment in Labuan. Labuan’s legislative framework is not only business-friendly but also prudent to safeguard Labuan’s international image as a clean and reputable offshore financial centre.