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Archive for November 14th, 2008

Gulf Daily News: Al Salam Bank Bahrain’s New Branch Opens

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Points of Essence:

  • Al Salam Bank Bahrain transforms its newly opened branch at Bahrain City Center into a full banking suite to offer banking convenience for its clients. Top customer services and cutting edge facilities are prioritized at the branch to meet the sophisticated demands of its clients. Gulf Daily News has the report.

Bank opens new branch

MANAMA: Al Salam Bank – Bahrain has opened its second branch at Bahrain City Centre.

The branch houses a business centre that is equipped with the most sophisticated and state-of-the-art computer systems that are not found in any other bank in the country, executive vice- president and head of Mena Nabeel Al Tattan said.

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Written by Suapi Shaffaii

November 14, 2008 at 12:05 pm

London’s new mayor encouraged by the growth of Islamic banking and insurance

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Points of Essence:

  • As London is emerging an international Islamic financial center, it’s vital to have someone at the core heart of the City’s administration who will appreciate the significance of Islamic finance. The city’s newly appointed mayor, Ian Luder will perhaps take this pointer forward. Times Online reported.

London welcomes new mayor Ian Luder to office

Ian Luder, whose father taught at a school in Hackney, has selected finanical education as the theme of his year as Lord Mayor of the City of London

Ian Luder, whose father taught at a school in Hackney, has selected finanical education as the theme of his year as Lord Mayor of the City of London

By Martin Waller

One of Ian Luder’s childhood memories is of being taken regularly into the City to watch the Lord Mayor’s Show. This is the occasion when the latest to occupy a post that dates back to 1189 tours his constituency in his gilded coach. Today, Mr Luder will take his place in the coach, the 681st to serve as Lord Mayor. One has to ask if that little boy ever contemplated this.

“All little boys dream. My parents brought me to the show. My mother made me learn the names of the lord mayors from a very early age.” Not all the way back to 1189? No, but “I had a penchant for remembering things. I liked history, facts and statistics. I think the little boy who watches the show and doesn’t dream that one day he might be in that golden coach is a very strange boy.”

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Written by Suapi Shaffaii

November 14, 2008 at 11:55 am

Posted in Financial Centres

Tagged with , , ,

Sharia scholars oppose more regulation on Islamic finance

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Points of Essence:

  • Shariah scholars have concerns for imposing legal standards for Islamic finance as it may be inconsistent with the Islamic principles of ijtihad (reasoning). Ijtihad is a potent tool to continuously reassess the modern day requirements of any particular Shariah injunctions. Read more about that in the article below.

Posted by: Tom Heneghan

At a time when many critics are calling for tighter regulation of the worldwide financial industry, Muslim scholars are saying that Islamic finance cannot be more tightly controlled for theological reasons. The Islamic finance industry has long been marked by divergent interpretations of Sharia, or Islamic law.

(Photo: Traders at Saudi Investment Bank in Riyadh, 8 Oct 2008)

Now, amid calls for standardisation, the scholars say the Islamic concept of ijtihad – reasoning to reassess  sharia in light of modern developments- bars any tighter regulation or coordination of this $1 trillion industry.

It’s rare that religious scholars get to dictate terms to business, but this might be one because Islamic finance is expressly built upon the principle of sharia compliance.

Here’s a report from Frederik Richter, a correspondent in our Bahrain bureau:

Scholars reject strict Islamic finance standards

MANAMA, Nov 10 (Reuters) – Islamic scholars on Monday cautioned against enforcing legal standards in the Islamic finance industry, even though the lack of standardisation is widely seen as an impediment to growth.

Scholars said at the conference of the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) that legally binding norms would challenge the Islamic concept of ijtihad, or reasoning, that continuously re-assesses sharia, or Islamic law, in light of modern developments
This would make the industry more vulnerable to risks, they argued.

“There should not be sharia standards except in the form of reasoning, which gives different windows to solving problems,” said Mohamed Saeed al-Booti, professor at the University of Damascus and member of AAOIFI’s board of trustees.

(Photo: AmIslamic Bank in Kuala Lumpur, 11 Aug 2008)

Scholars said introducing binding legal standards for the industry would limit the diversity in Islamic banking products that they say has helped the industry weather the global financial crisis.

Sharia scholars play an important role in Islamic banking as they advise banks on whether specific loans and investments  comply with sharia, which bans interest and prohibits investments in certain areas such as gambling and alcohol.

The $1 trillion Islamic banking industry has ridden the boom in Gulf Arab oil earnings, but is struggling to reconcile vastly different interpretations of Islamic law.

Regulators and industry practitioners said legally enforced industry standards are badly needed to increase investment certainty and lower transaction costs.

“Western banks and lawyers find it difficult to understand how to enforce a contract that one group of Islamic scholars opposes and the other doesn’t,” said Neil Miller, partner at international law firm Norton Rose.

He added the industry needed to discuss how to address this issue without moving away from its diversity, which he said has been valuable to the sector.


Written by Suapi Shaffaii

November 14, 2008 at 11:54 am