Interest free Islamic banking takes roots
Kuala Lumpur: Rising oil wealth is lifting Islamic banking - which adheres to the laws of the Koran and its prohibition against charging interest into the financial mainstream. Big banks, including Citigroup, HSBC and Deutsche Bank , as well as financial capitals like London, Tokyo and Hong Kong, are all going into the Islamic banking business. An estimated 300 Islamic financial institutions hold at least $500 billion in assets, an amount that is increasing more than 10 per cent a year. In addition to Islamic loans, there are Islamic bonds, Islamic credit cards and even Islamic derivatives. Loans and bonds that conform to the Koran are already available in the US. And Britain, Japan and Thailand are contemplating issuing Islamic bonds of their own. "This is an industry on its way from a niche industry to becoming a truly global industry," said Mr Khawaja Mohammad Salman Younis, the managing director for operations in Malaysia for Kuwait Finance House, the world's se...