PNM-BII in sharia partnership

JAKARTA: State-owned investment firm PT Permodalan Nasional Madani (PNM) and Bank International Indonesia (BII) signed a marketing partnership agreement on Tuesday for the former's sharia mutual fund products. The move is aimed at facilitating those wishing to invest in PNM

Both companies expressed confidence that the sharia fund market would notch up excellent growth in 2004, given the public's high level of interest in conducting business in accordance with sharia law.

A sharia investment is an investment that complies with Islamic law, which bans the receipt of interest from loans and relies on revenue-sharing schemes instead.

PNM Investment Management's managing director, Reynaldi Hermansjah, said that the firm had garnered total assets of Rp 46 billion (US$5.41 million) since being established in May 2000, out of total of Rp 78 billion overall invested in the sharia mutual fund market.

The firm's sharia mutual fund division currently has over 300 customers, with 80 percent of them retail businesses.

BII's sharia division head, Ismi Kushartanto, said that the partnership would provide an alternative investment channel for the bank's sharia customers.

Ismi added that the bank's sharia division, which serves 230 clients, had attracted Rp 185 billion since its establishment in May last year.

"We predict that growth will triple in 2004, reaching between Rp 500 billion and Rp 600 billion," he said. -- JP