Islamic Banking

Mumbai: “Unless there are amendments in the Banking Regulation Act of India, 1949, Islamic Banking system can be introduced in India,” said Abdul Hasib, former Director, Reserve Bank of India. The Islamic Banking system will be helpful for underprivileged and marginalized people, he said.

He was addressing a seminar on Global Financial Crisis and Islamic Economic System organized by Jamaat-e-Islami Hind in Mumbai on Saturday. Advocating for introduction of Islami Banking in the country Abdul Hasib said: the high profile Raghuram Rajan Committee on Financial Sector reforms in India has advocated the introduction of Islamic banking in India. He also differentiated between Islamic financial system and interest free banking and said that many other countries have started Interest Free banking.

While the world is facing the severest Financial Crisis in the new century there is an exception to it. Islamic banking and financial system has largely been unaffected and more so proved to be resilient because it’s transparent, ethical and based on sharing and caring, observed Abdur Raqeeb, convenor, National Committee on Islamic Banking. While France, Japan, UK and other countries have opened the door for this Multi Billion dollar business, India should not distance itself, he urged. He also shunned the misconception that Islamic financial system is for Muslims only. He said it is for all human beings. It makes sure that the monitory resources do not remain among few rich but revolves in the whole society.

Interest and no transparency are the basic factor of deepening financial crisis where billions of dollars were lost, Dr.Sharique Nisar an Economists and expert in Islamic Banking explained. He also explained different Islamic Financial Products prevailing in the world like, Musharakah, (Participation), Mudarabha (speculation), Qarde Hasna ( Interest Free Loan), Ijara, (Leasing). He urged, “The people must be taught about this alternative financial system which is just and fair and a general awareness must be created.

Maulana Riyaz Ahmed Khan, Vice President Jamaat-e-Islami, Hind, Maharshtra, concluded: “The current financial system has resulted the accumulation of the Financial resources into the 20 percent of the population and majority is fighting for only 20 percent of the wealth. He also added, “Islamic financial system is aimed at reversing the scene and aimed at the welfare of the society and not of the rich.”

Dr.Rahmatullah, Economists, JF Patil, Head of Economic Department, Kolhapur University also addressed the gathering.

By Rehan Ansari

A proposal to set up financial institutions based on the principles of Islamic banking to attract interest free deposits from Non Resident Keralites is being considered by the Kerala government, Finance Minister T M Thomas Isaac said today.

Speaking to reporters on the sidelines of a function here,Isaac said the proposal was mooted by the industries department to attract investment to the state.

The consultant appointed to study the feasibility of such financial institutions in the state has already given a go ahead to the proposal, he said.

“The banking institutions will not give interest to depositors and will not take interest from borrowers,” he said.

The investment would be used to set up industrial ventures and infrastructure projects and the profit from such ventures will given to the depositors.

Mumbai; A two-day national workshop on the Roadmap for Islamic Banking in India was held by Jamaat-e-Islami Hind, a leading Muslim organization of India, on 16-17 Sept 2006 at Mumbai. Various International and national finance experts, professionals and bankers discussed diverse aspects to implement Islamic Banking in India and jointly drafted a resolution.

At the workshop several panels were formed, under experts’ guidance to study on micro and macro levels on the Roadmap to Islamic Banking in India.

Under Dr. Ausaf Ahmed’s supervision a panel concluded that "Islamic banking is the greatest need of the hour and valid for all centuries because it promotes justice and equity among human beings. It encourages the participation of all communities in profit and loss of economy. It also generates employment in finance sector and benefits global economy." Another panel analysed the Steps to develop Islamic Banking in India and stated that; "few working groups need to be established to work on mobilizing public opinion and regulatory amendment for Islamic Banking. Political will to be developed. To be collaborated with HSBC and City banks for opening Interest Free or Islamic Banking Windows/ products and to promote more cooperative societies."

Discussing on Success and Sustainability of Islamic Banking the panel said that, "The professional expertise and entrepreneurial skills of the population need to be developed so as to cultivate abilities to run and manage financial institutions in a professional manner. To ensure involvement of each and every section of the country."

Exploring the Possibilities of Islamic Banking in existing Indian legal framework and the panel depicted that, "Existing framework does not permit Islamic Banking. Only selective activities like equity investment is possible while trade finance aspects like taking title to goods is not possible. A lot of amendments need to be carried out in existing legal framework. Appropriate models to be selected and implemented to suit society’s diverse financial needs. Islamic Bank of Britain, Islamic banks of Thailand, Singapore and USA may be glaring models for Indian Bankers. The reputed domestic and international banks may be involved in the process of determining and implementing Islamic Banking products to the extent possible in India under the current regulatory framework." Renowned international Islamic finance expert and Shah Faisal awardees scholar Dr. Najatullah Siddiqi and Mufti Barkatullah (Shariyah advisor of Lloyd Bank and Islamic Banking, Britain), Mr. Mohammed Talha (First manager Qatar International Islamic Bank, QIIB), Mr. Nizar Kochery (Legal advisor & President Middle East Indian Management Association, Qatar ) these leading international finance personalities were the part of this historical workshop.

Well-known finance expert and Islamic economist Dr. Fazlur Rahman Faridi was the chief patron, Dr. Rahmatullah (AICMEU ) was the organiser and Jamaat-e-Islami Hind’s media secretary and Tamil Nadu state president H. Abdur Raqeeb was the convener of the workshop.

Dr. Ausaf Ahmed (Islamic Development Bank, Saudi Arabia) , Dr. M. I. Bagsiraj and Dr. Shariq Nisar, Dr. Abdus Salam (Retired manager RBI, Cochin ), Dr. M Y Khan (SEBI ), Mr. Ashraf Ab. Haq Mohamadey (IDAFA Investment Pvt. Ltd.), Mr. I.H.Zaki, Mr. Anwar Batki (Ex-Legal Advisor, RBI) , Mr. Zahooruddin (Hyderabad), Mr. K.K. Ali (Alternate Investment & credit Ltd. Cochin), Mr. Maqbool Ahmed (Bengalore) have attended the workshop.

The participants unanimously concluded that, "Islamic Banking can play pivotal role to facilitate growth with equity and to attract foreign investment, especially Petrodollars which are moving very fast from the developed countries to the emerging markets after 9/11. ‘Development with human face’ the agenda of UPA Government may definitely be fulfilled by Islamic banking. So we appeal the government to accommodate Islamic Banking in the Banking Regulation Act."

Contact for further information: H. Abdur Raqeeb, Convenor Islamic Banking Workshop : 0944407550301, abdraqeeb_h@yahoo.com

BY: MY KHAN

The Reserve Bank of India has appointed a committee to examine the feasibility and possibility of facilitating Islamic banking in India.

Islamic banking is a recent concept, which is slowly replacing interest-based banking in many parts of the world. The Islamic finance is based and functions on the basis of a model which does not involve interest on lending as well as on deposit, and financial institutions like banks share both profits and losses from the business. The modus operandi of these banks are worth considering for an economy whether it is a secular or Islamic state.

Islamic banks use the principle of Almudarib-udarib, which means they mobilise financial funds on the basis of profit sharing and extend the same to the users on the same basis. There are two broad instruments for mobilising deposits and extending finance, viz. Mudarabah and Musharakah. In case of these instruments, the return cannot be fixed in advance and it is determined ultimately by the profits earned by the business. Whether they are depositors or bankers, they have to share profits as well as losses. Uarze-hasna is another instrument for deposit mobilisation and for extending finance. On this instrument, the bank does not pay dividend. They are like current deposits. In addition to deposits, an Islamic bank can raise resources by issuing equity shares. Equity shareholders participate in the management of Islamic banks.

Let us have a little more explanatory analysis on Islamic instruments and their modus operandi to make the readers of an alternative model of banking.

As mentioned above, Mudarabah, an instrument in Islamic banking is a contract between the bank and the entrepreneur (manager) or user of the capital. The bank in this case does not participate in the business and the profit is distributed between them, according to the ratios fixed in the agreement between both parties. The financial loss is borne by the bank and the entrepreneur (manager) bears the loss by not getting any return in compensation for the opportunity cost of his own labour and managerial work.

Musharakah is a contract between the bank and entrepreneur. Here, the financier (bank) participates in the management and also shares the profit and loss. While profits are distributed according to an agreed ratio, the loss is borne in proportion to the share of each in the total capital.

Murabahah is a sale contract with a profit mark-up. The client purchases such commodity from the bank at a deferred price, which includes an agreed profit margin or mark-up.Here, the transaction consists of one agreement between the Islamic bank and supplier of the commodity and a second agreement between the bank and the client who placed the order with the bank for a commodity.

Ijarah (leasing finance) is a contract to supply assets like machinery, air-planes, ships or trains on lease. The asset purchased by the bank as per the requirement of client (lessee) and sold at a pre-determined price to lessee but the lessor (bank) keeps the ownership of the assets with all the rights as well as responsibilities, which is an integral part of the ownership.

However, Islamic banks in India do not function under banking regulations. They have been working as NBFCs or credit co-operative societies. The Islamic banks if set up cannot maintain cash reserve and SLR since these involve interest. They cannot be treated as scheduled banks and cannot avail facility of settlement and clearing system and therefore they cannot issue cheques.

Other constraints are inability to maintain capital adequacy and would be unable to interact with interest based banks and money market in India. The RBI can think of setting up a single window in some banks like State Bank of India to do Islamic banking. Malaysia also started Islamic banking by opening Islamic banking sections or Islamic banking windows attached to the existing banks. Moreover, Islamic banking will require a new legislation to start Islamic bank.

The author is former economic advisor to Securities and Exchange Board of India Ltd

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An Islamic Banking Seminar held in Mumbai highlights on how India can benefit from a re-direction in the flow of petro dollars from West Asia.

Jamaat-e-Islami Hind (JIH), one of the leading Muslim organisations based in Delhi, will make a detailed presentation to the Finance Ministry and the RBI on the need to amend the RBI Act and kickstart Islamic banking in India.

“The central bank should allow the Islamic bank to have no-fixed rate regime as Islamic banking is based on participatory, co-operative and investment banking,” said Mohammad Talha, first manager, Qatar International Islamic Bank and one of the speakers of the national seminar on Islamic banking organised by JIH here. The RBI has already set up a working group on Islamic banking headed by Anand Sinha.

“After 9/11, petro dollars are going to Southeast Asia instead of Europe and the US. We aspire to channelise petro dollars to India. If it is allowed, Islamic banks in India with its network in other countries and syndication can facilitate investment by equity funds and high networth individuals in India, which would prefer an Islamic banking set-up,” Talha said, adding that once Islamic Banking is launched in India, it can also help domestic firms raise bonds in West Asia.

A Bahrain-based private equity fund, with a corpus of $1 billion, wants to start a India-specific fund. Also firms like Abu Dhabi Investment, Qatar Investment Authority and Islamic Bank Finance House are looking at investing in India. “Indian Islamic Banks can definitely help channelise these funds properly. Islamic banks can effectively tap property worth billions under the control of Awqaf and Zakat,” opined H. Abdul Raqeeb, member of JIH and convenor of the seminar.

Explaining the working of Islamic bank, Raqeeb said it is a interest-free banking based on Islamic law, Shariah. In this system, the depositor and bank will come to an agreement wherein both the parties will share the profit or losses at the end of the year. The bank will invest in stocks, bonds, infrastructure projects and so on. If the loss arises, the shareholders of the bank will absorb the loss. In the case of lending, the banks will not charge any interest but levy a service charge. Overdrafts are provided, subject to a maximum, free of charge.

“Islamic banking can revolutionise the micro-finance sector in the country and become a boon for the debt-ridden farmers in Maharashtra,” said Dr Ausaf Ahmed, a retired official of Islamic Development Bank, Jeddah.

Commenting on the international scenario, Talha said Islamic banking across the world is a $300 billion industry spread over 35 countries. MNC banks like Citibank, Grindlays, HSBC, ABN Amro and Sache banks are offering Islamic banking products. Even home-grown banks like ICICI and Kotak Mahindra Bank are offering Islamic banking products in the West Asia.

Islamic Market Index of Dow Jones has launched over forty Islamic indices. FTSE, London also offers Islamic indices in US, Europe, the Pacific and South Africa.

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By Minna Kumar

Islamic banking as a concept has gained momentum world over and in India over the past few years. Several foreign banks operating in India, like Citibank, Standard Chartered Bank, HBSC are operating interest free windows in several West Asian countries, Europe and USA. There is also a growing awareness about the concept among Indian banks and it is generally felt that there is a huge potential market in India for Islamic banking products.

Islamic banking as a concept has gained momentum world over and in India over the past few years. Several foreign banks operating in India, like Citibank, Standard Chartered Bank, HBSC are operating interest free windows in several West Asian countries, Europe and USA. There is also a growing awareness about the concept among Indian banks and it is generally felt that there is a huge potential market in India for Islamic banking products.

Several banks in the country have shown an inclination to undertake this form of interest-free banking. However, unless proper regulations are in place to oversee this form of banking, it will not be possible for scheduled commercial banks to follow the Islamic rules of banking even in a small way.

This has led the Reserve Bank of India to set up a committee headed by Mr Anand Sinha, chief general Manager in-charge, department of banking operations & development to look into the matter. Islamic organisations like Jamat-e-Islami are taking an active interest in seeing it through; and its Maharashtra chapter recently organised a seminar of Islamic scholars and former bankers on this theme.

TimesofMoney has made a beginning in a small way by offering products & services that are in compliance with Shariat (Islamic Law) in alliance with Mashreq Bank, UAE. But this facility is strictly for remittances from the Gulf to India.

Presently in India, Islamic banking is confined to the co-operative sector. Only 10-15 Islamic banks with deposits of about Rs 75 cr are operating all over the country in various states. They are actually non-banking finance companies (NBFCs), which work on no-profits-no-loss basis. Islamic banks by and large cater to the needs of local area except a few that operate across districts or states. Their sources of funds are limited and as a result these banks have to operate on small scale missing the economies of scale.

Islamic banks in India provide housing loan, on the basis of co-ownership, venture finance on Mudarabah basis as well as on Musharaka basis and consumers loans. {Ref to Previous Article….} . Some banks finance purchase of automobiles on a hire-purchase basis. Education finance and skill development finance is also provided by them. Investments are made in government securities, small savings schemes or units of mutual funds. These banks also invest in shares of companies. Hire-purchase and lease finance are other source of investments.

These banks do not function under banking regulations. They are licensed under Non Banking Finance Companies Reserve Bank Directives 1997 RBI (Amendment) Act 1997. RBI has also introduced a compulsory registration system. Within the present system, even if banks are allowed to set up windows offering this service, they maintain cash reserve and SLR since these involve interest. This type of banking cannot avail facility of settlement and clearing system and therefore they cannot issue cheques. Other constraints are inability to maintain capital adequacy and would be unable to interact with interest based banks and money market in India.

Consequently, RBI cannot act as the lender of last resort because such accommodation by the monetary authority is also interest based. Islamic banks cannot interact with conventional banks based on principles of interest.

Islamic banking concentrates more on short-term and medium-term operations because long-term lending involves project appraisals and assessing long term profitability. Most such banks are ill equipped to handle this responsibility because of the smallness of their operations.

Regulatory issues need to be sorted out before Islamic banking can be introduced in India and its benefits can be enjoyed to the fullest.

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By Minna Kumar

Islamic banking is a very young concept. Yet it has already been widely implemented in the Islamic world and in a few non-Muslim countries as well.

The shariat or Islamic principles frowns on interest, but money can be lent on `reasonable terms.’ Several Islamic nations have embraced this form of banking and the banks are not essentially owned or controlled by Muslims. So, instead of lending and charging interest, what banks do is to buy the asset and lease it or hire it. What the bank earns is not interest but profit. Therefore the accounting systems also differ drastically from conventional banking.

Even Islamic banking understands that banks cannot do charity. They have to earn their reward for the services rendered.

Investment finance is offered by these banks through ‘Musharka,’ where a bank participates as a joint venture partner in a project and shares the profits and losses. Investment finance is also offered through ‘Mudabha,’ where the banks contribute the finance and the client provides expertise, management and labour and the profits are shared in a prearranged proportion, while the loss is borne by the bank.

Mudaraba participatory financing is a unique service offered by Islamic banks. This system can offer responsible financing to socially and economically relevant development projects.

These banks also offer trade finance in a number of ways. One way is through mark-up, where the bank buys an item for a client and the client agrees to repay the bank the amount along with an agreed profit later on. Banks also finance on lines similar to leasing, hire purchase and sell and buy-back. Consumer lending is without any interest, but the banks cover expenses by levying a service charge. Besides, these banks offer a host of fee-based products like money transfer, bill collections and foreign exchange trading where the banks own money is not involved.

Apart from being widespread in Islamic countries, this practices is also followed in several countries in Europe and the Americas. In India, though there is no full-fledged Islamic bank, there are many non-bank financial intermediaries operating on Islamic principles. Several co-operatives throughout the country also operate on these principles. The Reserve Bank of India has recently appointed a committee to look into the prospects of introducing certain Islamic products in Indian banks.

There are several drawbacks to this system. In many countries, Islamic banks do not have the power to issue cheques. Internal controls need to be devised in countries where these banks do not operate on the large scale. Inadequacy of information about this system and lack of regulations specific to Islamic banking can be a deterrent for these banks to co-exist with other banks.

These irritants, though minor, need to be ironed out before this unique system can find complete adaptability in non-Islamic parts of the world.

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The Indian banking system is losing a staggering Rs 2-3 lakh crore annually, due to the delay in introducing Islamic banking laws (IBLs), analysts say.

Though Muslim parliamentarians have taken up the issue with Prime Minister Manmohan Singh and the UPA chairperson Sonia Gandhi, the Reserve Bank of India is yet to take any concrete action on introduction of IBLs.

In their presentations, the Muslim Parliamentarians have underlined that Islamic banking can be easily introduced without disturbing the basic fabric of Indian financial system.

K Rehman Khan, deputy chairman of Rajya Sabha, said that products similar to mutual funds can be introduced in line with the fundamentals of Islamic banking laws, which do not recognise interest-based banking.

However, Islamic banking laws are based on trading and thereby sharing of profit. Khan added that once the system is recognised, savings of the Muslim comumity would only make Indian banking richer and stronger.

Globally, the financial system has a corpus of about $700 billion under the Islamic banking system. Banks like HSBC and Lloyds TSB have Shariah compliant units to bring the Muslim community into the banking system.

It is learnt that several leading Indian banks like ICICI Bank are looking at various ways of introducing Islamic banking products without disturbing the fabric of Indian banking system.

"The Islamic banking system does not recognise interest-based transaction but the main element of profit is not eliminated from the system," Mr Khan said, adding that there is no reason why India cannot implement the Islamic banking system, especially as most other western countries like the UK have recognised the system.

Earlier, the Muslim leaders had proposed setting up of a non-banking finance company in line with Malaysia’s Tabung Haji for the large Muslim population in the country. Meanwhile, several banks from West Asian countries have evinced interest in entering India.

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What is Islamic banking?

It is banking practised as per the Islamic principles as prescribed in the ‘shariah’ known as ‘Fiqh al-Muamalat’ (Islamic rules on transaction). The Islamic law prohibits interest on both loans and deposits. Interest is also called ‘riba’ in Islamic discourse. The argument against interest is that money is not good and profit should be earned on goods and services only, and not on control of money itself. But Islam does not deny that capital, as a factor of production, deserves to be rewarded. It allows the owners of capital a share in a surplus, which is uncertain.

How does it function?
It operates on the principle of sharing both profits and risks by the borrower as well as lender. As such, the depositor cannot earn a fixed return in the form of interest. The banks are permitted to offer incentives, such as variable prizes or bonuses in cash or kind on these deposits. The depositor — who unlike in the conventional banking system is risk-averse — is a provider of capital and equally shares the risks that the bank who lends his funds.

What are the different products offered?
Investment finance is offered by these banks through ‘Musharka,’ where a bank participates as a joint venture partner in a project and shares the profits and losses. Investment finance is also offered through ‘Mudabha,’ where the banks contribute the finance and the client provides expertise, management and labour and the profits are shares in a prearranged proportion, while the loss is borne by the bank. Trade finance is also offered through a number of ways. One way is through mark-up , where the bank buys an item for a client and the client agrees to repay the bank the amount along with an agreed profit later on. Banks also finance on lines similar to leasing, hire-purchase and sell and buy-back. Consumer lending is without any interest, but the banks cover expenses by levying a service charge. Besides, these banks offer a host of fee-based products like money transfer, bill collections and foreign exchange trading where the bank’s own money is not involved.

Where is it practised?
Islamic banks have come into being since early 70s. There are nearly 30 Islamic banks all over the world, from Africa, Europe to Asia and Australia, and are regulated even within the conventional banking system. The whole banking system in Iran has moved over to the Islamic system since the early 80s and even Pakistan is Islamising its banking system. A number of European and American banks are now offering Islamic banking products, not only in Muslim countries, but also in developed markets, such as UK. The concept is also catching up in Malaysia and Dubai.

How far is it feasible in a market economy?
Islamic experts say that with growing indebtedness of many governments and with bulk of the borrowing going to servicing of the past debt and payment of huge interests, it could be an alternative to conventional banking as practised in the rest of the world. Wherever it is practised, studies have showed that the rate of return is often comparable and sometimes even higher than the interest rate offered by conventional banks to depositors.

Is it practised in India?
In India, though there is no full-fledged Islamic bank, there are many non-bank financial intermediaries in Mumbai and Bangalore operating on Islamic principles. Their presence in the form of co-operatives in various parts of the country has been there before independence. The Reserve Bank of India has recently appointed a committee headed by a chief general manager to look into the prospects of introducing certain Islamic products in Indian banks. What is unique is that the products are structured according to norms prescribed in the ‘shariah’.

What are the drawbacks?
In many countries, these banks do not have the power of issuing cheques. Besides, many banks where they operate on a very small-scale do not have adequate internal control system because of which their accounting is not very transparent. Also, inadequate information is provided to the regulator. Wherever they co-exist with conventional banking, the central bank’s control of bank interest rates is liable to be circumvented by shifts of funds to the Islamic banks.

From  The Economic Times

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Banking could get sensitive to religious beliefs soon. A special committee of the Reserve Bank of India (RBI), appointed on the directions of the Government of India, is studying ‘‘instruments of Islamic banking.’’

Islam prohibits interest, the fundamental instrument of modern banking. Offering financial products and services that conform to Islamic principles can lead to the unlocking of large financial capital that believers are unable to invest. In Kerala alone, thousands of crores earned in interest is kept in suspended accounts as believers do not claim it. ‘‘This money could be above Rs 40,000 crore,’’ says sociologist Imtiaz Ahmad, formerly of JNU.

Formed in July, the committee headed by Anand Sinha, Chief General Manager in charge (Banking Operations and Development), RBI, has not fixed a deadline yet. ‘‘The present committee is only studying the possibilities of instruments of Islamic banking. I cannot say if it will lead to changes in banking regulations,’’ an official said.

However, trends worldwide show the change. Banks such as HSBC, Standard Chartered etc have Islamic banking divisions started in recent years, and Indian banking regulators are perhaps catching up.

Instruments of Islamic banking are broadly based on the concept of sharing risk and profits rather than assured rates of interests.

• For instance, murabaha is a mechanism of financing trading. Here, the contract will have cost and profit components, profit will be shared by the trader and the financier.

• Mudaraba involves a sleeping partner who invests and the labour partner who does the work—the first gets his principal and share of profit; if the business fails his capital and the latter’s labour sinks.

• In musharaba, it is equivalent to a joint venture where banks get on board with equity and management partnership.

• In muqarada, or Islamic bonds, investors share the profits of the cumulative investments. And the bank collects a service charge, where profit sharing is not involved.

Jamaat-e Islami Hind, campaigning for Islamic banks for long, is excited about the RBI move. ‘‘There are many Muslims who are unwilling to deal with the existing banking system. And some are earning a lot of wealth too. If they have an opportunity to invest, on a profit-sharing basis, it is going to have a major impact on the economy,’’ says Siddique Hassan, secretary.

Abdur Raqeeb, Tamil Nadu state president of the Jamaat-e Islami, says interest-based banking can create havoc, as it happened in the case of farmers in AP. ‘‘Islamic banking is based more on sharing of responsibilities and is more compassionate,’’ he says, adding it could make credit available for the weaker sections.

But there is a lot of heated debate among ulemas on what is permissible and what’s not and some scholars say it is all a farce. ‘‘It is all very good to talk about but I am not convinced of its viability,’’ says Prof Imtiaz Ahmad.

However, it may not be the moral or religious arguments, but the economic ones that got the concept moving across the globe and now in India—assets controlled by Muslims is estimated to be $1.5 trillion and growing at 15 per cent a year. Banks began to eye this—Islamic bonds collected $30 billion in 2004, $20 billion already this year. Malaysia, headquarters of Islamic Financial Services Board (IFSB), has emerged the hub of Islamic banking. As many as 265 Islamic banks across 40 countries have assets of $262 billion.

Services offered by Islamic banks are a hit among non-Muslims too. More than 50 per cent business of HSBC’s Islamic banking division started last year in Malaysia is with non-Muslims!

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