The world’s banks should study in detail how Islamic values have managed to avoid some of the worst elements of the global financial meltdown, according to a warning from Complinet, a compliance solutions provider.
“The lessons of Shariah banking have a lot to teach financial institutions,” says Paul Johns, Complinet’s vice president of Global Markets. “Pressure is definitely mounting for them to learn from their mistakes and embrace at least some of its principles.”
“Shariah’s emphasis on stability through a ban on speculation and the non-payment of interest has led to the Islamic finance market remaining in excellent health, despite the recent events in Dubai.”
Complinet’s advice comes as a UK-based Islamic bank – Gatehouse Bank – announced the launch of a Structured Trade Finance Fund next year to inject new flows of capital into the global marketplace.
And Professor Mahmood Faruqui, senior adviser at the Bank of London and the Middle East, today also urged a wider appreciation of Shariah banking.
Speaking during a Complinet webcast, Professor Faruqui said: “The problem in Dubai is not one of Islamic finance. The Shariah system allows stability through transparency and co-operation between regulators.”
Also speaking during the webcast, Peter Casey, director of policy at the Dubai Financial Services Authority, said: “Shariah banking has been given the opportunity to establish itself as a credible alternative, which offers something distinctly different.”
About Alex Akesson
Alex has been specializing in hedge fund and alternative investment news since April 2006. Working mainly in research and manager interviews, she has published breaking news on the hedge fund industry on her blog, as well as several industry publications.
Her access to hedge fund managers gives her insight into news stories as well, and the ability to track press releases and other breaking news in real time.
Much to be learned from Islamic banking principles, says leading compliance firm.
The world’s banks should study in detail how Islamic values have managed to avoid some of the worst elements of the global financial meltdown, according to a warning from Complinet, a compliance solutions provider.
“The lessons of Shariah banking have a lot to teach financial institutions,” says Paul Johns, Complinet’s vice president of Global Markets. “Pressure is definitely mounting for them to learn from their mistakes and embrace at least some of its principles.”
“Shariah’s emphasis on stability through a ban on speculation and the non-payment of interest has led to the Islamic finance market remaining in excellent health, despite the recent events in Dubai.”
Complinet’s advice comes as a UK-based Islamic bank – Gatehouse Bank – announced the launch of a Structured Trade Finance Fund next year to inject new flows of capital into the global marketplace.
And Professor Mahmood Faruqui, senior adviser at the Bank of London and the Middle East, today also urged a wider appreciation of Shariah banking.
Speaking during a Complinet webcast, Professor Faruqui said: “The problem in Dubai is not one of Islamic finance. The Shariah system allows stability through transparency and co-operation between regulators.”
Also speaking during the webcast, Peter Casey, director of policy at the Dubai Financial Services Authority, said: “Shariah banking has been given the opportunity to establish itself as a credible alternative, which offers something distinctly different.”
About Alex Akesson
Alex has been specializing in hedge fund and alternative investment news since April 2006. Working mainly in research and manager interviews, she has published breaking news on the hedge fund industry on her blog, as well as several industry publications. Her access to hedge fund managers gives her insight into news stories as well, and the ability to track press releases and other breaking news in real time.