The National Co-operative Organisation of Malaysia (Angkasa) has denied that it is raising funds from members for its new banking venture, saying it is only collecting pledges to invest.

"We are not collecting money. We are only introducing the bank and asking people how much they would be willing to invest," said an Angkasa executive council member who did not want to be named.

bank negara 270307 However, the official explained that if the apex body was still using the term 'bank' without Bank Negara's consent, it was because the concept was difficult to explain to members.

"We have been told by the Cooperative Commission not to use the term until we get approval, but if we use the temporary name, Koperasi Masraf Angkasa, our members won't understand," he said.

A potentially expensive mistake

Angkasa has gone on a nationwide roadshow to introduce its plan for the Islamic Cooperative Bank of Malaysia (ICBM) by next month, with a paid-up capital of RM300 million provided by the 7,688 cooperatives under its wing.

However, complaints have been lodged with the central bank over Angkasa's use of the term "bank", which contravenes Section 15 of the Banking and Financial Institutions Act 1989.

The offence is punishable by a five-year jail term, a fine of RM5 million, or both.

Should such an offence be continued to be committed, the offender would be liable to a daily fine of not more than RM5,000.