In a statement on Aug. 8, Bank Negara announced that "it is with great sadness that we announce the passing of Bank Negara Malaysia deputy governor, Dato' Mohd Razif bin Abd Kadir. Allahyarham Dato' Razif passed away peacefully today surrounded by family members and friends. Allahyarham Dato' Razif's contribution to central banking, and Malaysia has been immeasurable, and we would like to express our heartfelt gratitude for Allahyarham's service to the bank and nation. Our thoughts and prayers will be with Allahyarham's family."
Mohd Razif was a "central banker's central banker". He was probably one of the most accessible central bankers of his generation, always ready to talk to you in his genteel and unassuming manner. In the last few years, he very often deputized for Gov. Zeti Akhtar Aziz at conferences and events, and was the rock that supported Governor Zeti.
But behind that gentle urbane exterior was a dogged determination to help put the Malaysian financial services industry and its regulation and supervision on the global map and second to none in terms of international best practice, on-going reform, robust enforcement, independence of operations, consumer education and empowerment and proactive support for the Islamic finance industry at home and abroad.
His last two public speeches as deputy governor indeed were on Takaful (Islamic insurance) and on Islamic finance education and human capital development - two areas in which he had a passionate interest.
He spoke at the launch in April this year of ING Public Takaful Ehsan, which is a joint venture between the Malaysian subsidiary of ING, the Dutch financial services group, ING Management Holdings (M) Sdn Bhd, and the local Public Bank Bhd and Public Islamic Bank Berhad. The venture, he impressed upon his audience, signified yet another milestone in Malaysia's continuous endeavor to provide a sufficient financial safety net for the general population and to promote the development of a progressive and flexible Takaful industry in an increasingly challenging global environment.
"With this strategic alliance between 2 financial groups of such caliber," added the deputy governor, "Bank Negara Malaysia looks forward to strong management stewardship, innovative product offerings, wide distribution channels, operational and service excellence as well as breakthrough business strategies that are well-matched by robust risk management capabilities."
He was confident that with Malaysia's commitment to continually enhancing the dynamism and competitiveness of the Takaful industry in Malaysia, the "industry is on-track for quantum leap performance in this next phase of growth and development."Razif identified three dimensions from which strong opportunities for growth can be harnessed in the Takaful industry. The first one is the opportunity to penetrate the remaining underserved areas in family Takaful, especially medical and health Takaful, which in 2010 constituted only 9 percent of new family Takaful business.
The second dimension of growth relates to the transformation of Malaysia as a high income economy. With Islamic finance specifically identified as one of new growth areas under this new economic model, the Takaful industry stands to gain from this socio-economic transformation by seizing the opportunity to grow business beyond the more traditional business lines. This entails broadening product offerings to include bespoke and more sophisticated investment-linked and wealth-management products aimed at more affluent customers. At the other end of product spectrum, there should also be more emphasis to cover low-income individuals via microtakaful.
The third dimension of growth relates to the opportunities to be harnessed under the Malaysia International Islamic Financial Centre (MIFC) initiative which seeks to enhance the international dimension of Malaysia's Islamic finance proposition. "This presents a huge window of opportunity for our Takaful operators to accelerate their regional and global orientation and move up the global value chains. It is therefore important for strategic international partners such as ING to explore all possible avenues to elevate the business potential of Takaful internationally," he stressed.
Other factors critical to the successful development of the Takaful industry, he maintained, include human capital development; ensuring that Shariah governance and compliance remains at the heart of governance and business operations; the adoption of the highest level of professionalism and good market conduct; the ability of Takaful operators to deliver products which appeal to both Muslim and non-Muslims, whether corporates or individuals; and the adoption of a strong risk management culture in the light of the changing regulatory landscape towards risk-based capital, which is soon to be implemented for the Malaysian Takaful industry.
A month earlier he gave the keynote address at the "Islamic Banking Products: Theory, Practice and Issues" conference in Kuala Lumpur which was organized by INCEIF (International Centre for Education in Islamic Finance), ISRA (International Shariah Research Academy in Islamic Finance) and University Putra Malaysia. "Waves of innovation are pervasive in Islamic finance in recent years, fostering the generation of a wide spectrum of Islamic financial products and services. As the next frontier of development in Islamic finance evolves through innovation, we have to be mindful that innovation within an environment of constant change and increasing uncertainties is indeed a challenge. Joint efforts between academia and industry to conduct research, to explore and deliberate on issues relating to the development of new Islamic financial products, such as the efforts that have led to this conference can therefore provide a point of reference for the industry in ensuring that new and better products are developed to match the diverse and discerning needs of customers, while meeting the requirements of the Shariah."
The ability of Islamic finance, as a form of financial intermediation that provides a range of high quality financial products and services, he stressed, reflected the innovative and dynamic nature of the industry that contributes to its role as a facilitator of economic activity.
Razif was at Bank Negara for 35 years, which he joined in 1976 and held several senior positions in the central bank throughout his career. These included board member of Bank Negara Malaysia; chief representative of the Bank Negara London Representative Office; the director of the central bank's Bank Regulation Department; and the Director General of the Labuan Offshore Financial Services Authority (LOFSA) (1999-2001).
As deputy governor his responsibilities grew to include overseeing the development and regulation of the financial sector, including Islamic Finance and Takaful and the Development Finance Institutions.
Outside the immediate purview of the central bank, he also served as Chairman of the Technical Committee of the Islamic Financial Services Board (IFSB) which is an important position which guides the global industry's prudential and supervisory standard setting body; Chairman of Cagamas MBS Berhad, the National Mortgage Corporation of Malaysia, which is the largest securitization house in the country if not the region and one of the largest issuers of Sukuk in the world; and the chairman of the Credit Guarantee Corporation Berhad.
In terms of his involvement in financial education he sits on the board of INCEIF, which is the Islamic finance education arm of Bank Negara, and is a member of the Advisory Council for the International Centre for Leadership in Finance (ICLIF), which promotes continuous education programs for CEOs and senior management in finance both from Malaysia, Asia and the emerging countries. Razif was an effective central banker, a loyal and supportive deputy, a unflinching supporter of the Islamic finance industry, and above all a thoroughly decent and urbane human being complete with sense of humor. He will be sorely missed.