Asset management is the often forgotten sector of Islamic finance. Its development pales compared to the enormous strides made elsewhere in the Islamic banking industry, where substantial advances have been made in competitiveness, customer satisfaction and transaction volumes. Much is written in the Islamic finance press about waves of popularity in Islamic private equity, microfinance and sukuk. We rarely or never read about broad, common interest in Islamic asset management. Walking through the history and structure of the Islamic finance industry can help to explain why.
Some say the Islamic finance industry was born in 1975 with the opening of Dubai Islamic Bank (DIB), followed the next year by Bahrain Islamic Bank (BIB). However, one can argue that establishing a foothold in the somewhat primitive realm of retail banking is not much to crow about. More complex services are required to give credence to the birth of an entirely new industry.
