Green Energy
THE BIRMINGHAM POST: Growing numbers of non-Muslims are turning to Islamic banking as customers spooked by turmoil in the Western banking system increasingly see the sector as a safe haven.
The Birmingham-headquartered Islamic Bank of Britain said it had seen significant growth in non-Muslim customers since the onset of turbulence on financial markets as Islamic banks, bound by strict religious principles, are largely seen as insulated from the credit crisis.
Islam’s prohibition on the charging or paying of interest - riba - as well as rules on the kinds of investments they can make are among the reasons Islamic banks are coming through the crisis unscathed.
Islamic Bank of Britain head of marketing Steven Amos said: “Our core business will always be Muslims but the numbers of non-Muslims are really picking up.
“We’ve had massive interest and it’s down to the number of reasons why we’re insulated from the credit crunch.
“There were two reasons for the credit crunch. The first is liquidity - banks lending to each other on the money markets - but Islamic banks do not borrow or lend on money markets because interest is not allowed.
“The second reason Islamic banks are insulated is to do with assets - everything has to involve an underlying asset or service and if you are going to trade in an asset you have to own it first.”
The explosion in complex derivative products over the last few years has left Western banks reeling from exposure to toxic assets often far-removed from their everyday activities.
In contrast the more risk-averse Islamic finance system did not embrace this kind of deal.
“Conventional banks didn’t know what they were buying in these derivatives but we have no exposure to subprime as we just don’t deal in it full stop.
“That is one of the fundamental reasons we are insulated.”
Stipulations that you must own the asset you are trading in also mean practices such as short-selling are not a feature of Islamic banking. Non-Muslims Turn to Islamic Bank as a Safe Option >>> By Anna Blackaby, Business Staff | October 3, 2008
The Dawning of a New Dark Age – Dust Jacket Hardcover, direct from the publishers (UK) >>>
The Dawning of a New Dark Age – Paperback, direct from the publishers (UK) >>>
- London Precipitates Sharia Finance
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Thanks to Michael Travis for sending this over to me: Economic Crisis Fallout Shari'a Banking By Ilana Freedman; Editor & CEO, Gerard Group International, Inc. A dangerous trend is arising from the failing financial markets, as some of our leading...
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- A Steaming Pile Of Sharia Finance
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Green Energy
Non-Muslims Turn to Islamic Bank as a Safe Option
THE BIRMINGHAM POST: Growing numbers of non-Muslims are turning to Islamic banking as customers spooked by turmoil in the Western banking system increasingly see the sector as a safe haven.
The Birmingham-headquartered Islamic Bank of Britain said it had seen significant growth in non-Muslim customers since the onset of turbulence on financial markets as Islamic banks, bound by strict religious principles, are largely seen as insulated from the credit crisis.
Islam’s prohibition on the charging or paying of interest - riba - as well as rules on the kinds of investments they can make are among the reasons Islamic banks are coming through the crisis unscathed.
Islamic Bank of Britain head of marketing Steven Amos said: “Our core business will always be Muslims but the numbers of non-Muslims are really picking up.
“We’ve had massive interest and it’s down to the number of reasons why we’re insulated from the credit crunch.
“There were two reasons for the credit crunch. The first is liquidity - banks lending to each other on the money markets - but Islamic banks do not borrow or lend on money markets because interest is not allowed.
“The second reason Islamic banks are insulated is to do with assets - everything has to involve an underlying asset or service and if you are going to trade in an asset you have to own it first.”
The explosion in complex derivative products over the last few years has left Western banks reeling from exposure to toxic assets often far-removed from their everyday activities.
In contrast the more risk-averse Islamic finance system did not embrace this kind of deal.
“Conventional banks didn’t know what they were buying in these derivatives but we have no exposure to subprime as we just don’t deal in it full stop.
“That is one of the fundamental reasons we are insulated.”
Stipulations that you must own the asset you are trading in also mean practices such as short-selling are not a feature of Islamic banking. Non-Muslims Turn to Islamic Bank as a Safe Option >>> By Anna Blackaby, Business Staff | October 3, 2008
The Dawning of a New Dark Age – Dust Jacket Hardcover, direct from the publishers (UK) >>>
The Dawning of a New Dark Age – Paperback, direct from the publishers (UK) >>>
- London Precipitates Sharia Finance
Britain's government keeps up its efforts to turn London into a sharia finance central (via Intl. Business Times): Britain is encouraging banks through a task force to establish sharia-compliant products, aiming to position London as a Western hub...
- Time Magazine: The Case For Nationalizing The Entire Economy
Is this some sort of hip joke? From Time: The advocates for nationalizing U.S. banks have been out in force recently.Senator Lindsay Graham, who almost certainly does not have a PhD in economics or finance told ABC News that banks were in such deep trouble...
- Is Sharia Banking Set To Emerge From The Fallout Of The World Economic Crisis?
Thanks to Michael Travis for sending this over to me: Economic Crisis Fallout Shari'a Banking By Ilana Freedman; Editor & CEO, Gerard Group International, Inc. A dangerous trend is arising from the failing financial markets, as some of our leading...
- Uk Looks To Become A Global Provider Of Islamic Finance
From Mortgage Strategy: A government organisation is looking to educate financial institutions in a bid to help the UK become a global provider of Islamic finance. UK Trade & Investment, which incorporates the work of the Foreign & Commonwealth...
- A Steaming Pile Of Sharia Finance
Shitrhea, I mean Sharia Finance is being proposed as a way out of the banking crisis. A mainstream paper like the Scotsman is promoting this pile?!?!? Watch out. Don't step in it. THE spectacular collapse of Lehman's, the problems at AIG...