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H.E. Dr. Khalfan bin Khirbash, Minister of
Finance & Economy, UAE, to inaugurate IRBC II.
Dubai Islamic Bank, celebrating 30 glorious years
of innovation and growth, has sponsored IRBC II as
the Platinum Inaugural Session Sponsor. Dr
Khirbash Minister of Finance and Chairman of Dubai
Islamic Bank is set to open and host the IRBC II
inaugural session and will be joined by Professor
Rifaat Abdel Karim, Secretary General of the
Islamic Financial Services Board (IFSB) amongst a
host of other distinguished guests. Dr. Khirbash
in his inaugural address at First Islamic Retail
Conference (FIRBC) held last year in March,
commended the increased global momentum and
interest in Islamic products in the banking
sector. Citing the examples of Citibank, Credit
Suisse First Boston, Deutsche Bank, Freddie Mac
and HSBC whom had all added Islamic products and
services to their portfolio, Dr. Khirbash noted
that the UAE's commercial banking sector has seen
a strong trend towards the conversion of
conventional banks into Islamic ones.
Dr. Khirbash went on to say that, "Islamic finance
has proven its competence and can grow to be a
powerful force for good in our own societies and
beyond. For an industry that is still considered
something of a newcomer, in the past three
decades, we have seen a very impressive dynamic.
Retail managers at banks both here in the
UAE
and globally have an opportunity and a
responsibility to provide the marketplace with the
products and services consumers require."
Dr. Khirbash concluded his address by noting that
as the UAE
was host to the world's first Islamic bank,
hosting of the first ever Islamic Retail Banking
Conference in Dubai reflected the UAE's growing
role and contribution to the industry.
Reza Adil, Director at Islamic Conferences Group (ICG)
commenting on IRBC II stated, 'Given that the 2nd
instalment of this popular and focused Islamic
Retail Banking Conference series IRBC II, has
coincided with Dubai Islamic Banks (DIB) 30th
celebratory year, it is fitting and indicative of
DIB's success that they are supporting this key
and popular industry event through a high profile
platinum sponsorship. It is also indeed apt, in
light of his comments last year that Dr. Khirbash
will also inaugurate IRBC II this year'.
Since Dr. Khirbash's perceptive comments and the
close of the immensely successful First Islamic
Retail Banking Conference, the Islamic retail
finance industry has grown from strength to
strength achieving significant milestones in both
Muslim and Western markets.
Interaction with, and the entry of Western and
conventional financial institutions to the sector
has also heightened the debate with some observers
suggesting that Western conventional and Arab
banks with Islamic windows are more aggressive and
bring extensive experience of marketing, big
balance sheets and innovation to the sector.
Factors that it is suggested will enable them to
outpace Islamic banks in developing both their
retail and commercial business.
The verdict as to who will be the victors or that
this contention is accurate is still out however.
What is apparent is that interaction and
competition between conventional and Islamic
financial institutions can only be a good thing
for the development of the sector which globally
has been making significant inroads and attracting
unprecedented attention including from the media.
In Asia, the Middle East and Europe, more and more
banks and their customers are turning to Islamic
finance - and a growing number of the decisions to
do so are now made on commercial rather than
religious grounds. As a result, the sector has
moved from being a banking backwater only a decade
ago into what some senior bankers say is now the
fastest-growing financial sector in the world.
There is enormous potential for further growth in
the Muslim market of 1.3 billion people. Private
assets held in the Middle East alone are estimated
at more than $750 billion. With many more people
eager to have their financial affairs conducted in
line with Sharia law, this expansion is expected
to continue. But the real change is that
non-Muslims are starting to use Islamic finance.
The rising interest in Islamic finance around the
world has led to a major expansion in the number
of institutions offering Islamic Financial
services - not only those operating at the local
and regional level, but also the world's leading
banks. International regulators have also taken a
much more sympathetic stance toward the sector.
Global financial institutions, led by HSBC,
Citigroup, Deutsche Bank and BNP Paribas, are now
setting up either Islamic divisions or separate
banks. Most important, they are contributing to
the expertise needed to establish some of the
extremely sophisticated products now available.
Wider Authorization
Equally
important is that more jurisdictions are now
permitting Islamic finance. In a number of
countries, institutions are converting from
conventional practices to being Sharia-compliant.
Kuwait, which until this year had permitted only
one Islamic institution, the Kuwait Finance House,
has now relaxed its rules. Already, a new
institution, Boubyan Bank, has been set up, and
the Kuwait Real Estate Bank is becoming an Islamic
institution.
The United Arab Emirates, where the sector was
dominated for years by two institutions, the Abu
Dhabi Islamic Bank and Dubai Islamic Bank, is now
becoming more competitive. Banks like the
Dubai-based Emirates Bank International, hitherto
a conventional institution, are setting up Islamic
divisions. EBI has also established a bank in
Sudan, where the entire financial sector is
required to be Islamic. The National Bank of
Sharjah has changed from being a conventional to
an Islamic bank.
There is real change, too, in Saudi Arabia, where
there is much greater readiness by the regulatory
authorities to encourage Islamic banking. Al Rajhi
Bank has for many years had a virtual monopoly on
Islamic finance in the kingdom. But one of the
smaller banks, Al Jazira, is becoming fully
Sharia-compliant. The largest bank, National
Commercial Bank, is finding its new business so
dominated by demand for Islamic products that many
predict it will be fully converted within five
years. Another important development has been the
creation of the new bank, Al Bilad, which will
focus on developing retail products.
All the other banks in the kingdom are now
offering a full range of Islamic products and
services along with their commercial side. They
report that the majority of their customers are
demanding Islamic products. The expansion also
applies in some of the smaller Gulf states, such
as Qatar, now one of the wealthiest countries in
the region thanks to its extensive gas reserves.
Both Qatar Islamic Bank, which has taken a stake
in a bank in Malaysia, and Qatar International
Islamic Bank, which has a holding in Britain's
first Sharia-compliant institution, the Islamic
Bank of Britain, have produced excellent results.
The market has also been expanding in Asia, where
Kuala Lumpur is the main center for Islamic
financial activity. According to one banker, more
than 60 percent of his institution's Islamic
banking customers are Chinese. In response to the
growing market there and the decision of Bank
Negara to relax some of its restrictions on
foreign banks, Kuwait Finance House and Al Rajhi
are among the Arab institutions looking to do
business in the region - particularly in mainland
China.
Reza Adil went to say that in light of these
current and immense opportunities and developments
IRBC II presents an opportune forum in which such
key factors will be discussed. IRBC II Adil
suggests will also highlight other important
issues such as the effective use of technology,
marketing, PR, Branding in and the effective use
and interaction with media in the sector - Issues
that play a central role in the success of
institutions and the sector.
Adil concluded by extending an invitation by
saying, ' For those of you that joined us last
year at the inaugural event we hope that you will
join us again this year. For those you actively
engaged in Islamic finance, conventional finance
and who are interested in accessing this lucrative
sector we look forward to welcoming you to the 2nd
International Retail Banking Conference II.
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