Hussein Al Qemzi, group chief executive officer of Noor Investment Group and CEO of Noor Islamic Bank, believes that Islamic finance has the potential to evolve beyond its niche market and become the globally accepted norm in banking. But before it can do this, it must diversify its products and services, as well as achieve greater standardisation.
Latest articles from Islamic Finance
With sharia-compliant investments outperforming their 'conventional' counterparts, appetite for these products can only be expected to grow. But the industry is still too fragmented, according to Ian Lancaster of Cogent Asset Management, with a lack of cross-border connectivity preventing it from achieving critical mass.
The growth that has characterised the rise of the Islamic finance industry has thus far evaded the asset management segment of the market, with a dearth of institutions focused on the creation of sharia-compliant investment products. John A Sandwick of Islamic Wealth & Asset Management assesses the situation.
Islamic banks are growing more quickly than their conventional counterparts, but not all of this growth is generating good returns.
While IILM's debut issuance of a $490m sukuk in August was a significant milestone for Islamic finance, it will barely dent the industry’s short-term liquidity management issues, which are hampering growth.
While costs have not changed much for the top 25 Islamic standalone banks between 2006 and 2012, returns have dropped significantly. The Banker takes an overview of the key factors determining their operational efficiency.
The Banker's annual Top Islamic Financial Institutions ranking shows that growth has dropped into single digits for the first time since the ranking began. This, combined with the restructuring of sharia-compliant operations at major players such as HSBC, shows an industry that is entering a new phase of maturity; a phase that is, however, still rich with opportunity.
As Islamic banks continue to post impressive figures compared to their conventional counterparts, The Banker launches its inaugural awards aimed at celebrating this financial sector. With a global award, regional winners for Asia-Pacific and the Middle East, as well as 13 country prizes, the awards show what an impressive geographical reach Islamic finance has established.
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