Affin Holdings Bhd and its foreign partner, Hong Kong's The Bank of East Asia Ltd, have announced that they have submitted a proposal to the China Banking Regulation Authority (CBRA) to open China's first Islamic bank.

BEA Chairman and Chief Executive Officer Dr David K.P Li in Kuala Lumpur said in a statement that,"CBRA is currently still studying the regulation and practices of Islamic finance. We hope to be the first Islamic bank in China once the authority has come up with the regulations".

Affin holdings hope that the partnership will allow Affin Bank to make use of over 240 BEA branches worldwide covering Hong Kong, China, North America, the UK and Southeast Asia. BEA is also the single biggest foreign shareholder of Affin with a 23.5 per cent stake.We are confident that this strategic alliance will place both banks in a better position in many Asian markets and enable us to tap an even wider business opportunities," Affin Holdings chairman Tan Sri Mohd Zahidi Zainuddin said.

Early this month, Affin Bank bought Indonesia bank PT Bank Ina Perdana for RM138 million, its first venture outside of Malaysia. It may also offer Islamic finance services in the country which has a population of more than 200 million people.Affin Bank currently owns an Islamic banking subsidiary, Affin Islamic Bank, which started operations in April 2006 and since its inception has significantly seen a rise in demand for Islamic Shariah compliant banking. 

China is a diverse country which could benefit from the introduction of a fully fledged Islamic bank which could help to further promote and boost the Islamic financial sector as many countries are tapping into the lucrative industry which is set to reach over $1.5 trillion US  dollars by 2012. China has some of the oldest roots of Muslim history and has a large population of Muslims living in China. There is much scope for both Muslims and Non Muslims to tap into the highly ethical principles of Shariah compliant Islamic finance.