Prudential has announced the launch of its first dedicated Islamic asset management business in Kuala Lumpur, Malaysia.

The new firm, Prudential Al-Wara Asset Management, will provide sharia-compliant asset services for institutional investors both onshore and offshore. The move is complementary to Malaysia's goal of becoming a global Islamic finance hub, a title that is also coveted by Hong Kong and Singapore.

In a statement, Mark Toh, the head of Islamic fund management at Prudential Asia and the Malaysia chairman of Prudential Fund Management, said that Malaysia is in a better position to develop Islamic finance as the total assets under management in Islamic investments is greater here than in Singapore.

In addition, the country already has well-established shariah legal and investment structures. Prudential also already has Islamic fund management and Takaful businesses in Kuala Lumpur, totalling M$1.5 billion ($438 million).

Former Prudential Fund Management director of shariah investment Zulkifli Ishak will be serving as the chief executive officer and chief investment officer of Pru Al-Wara'.