Islamic banking deposits in Pakistan to reach Rs 780b by 2014
ISLAMABAD, July 08 : As the Islamic banking in Pakistan is undergoing tremendous growth, total deposits with the Islamic banks in country will reach Rs 780 billion by 2014, according to a recent report by Islamic Banking Division of Ferguson Associates. “Islamic banking in Pakistan is undergoing tremendous growth, a trend that is likely to accelerate with new Islamic and conventional banks entering the market”, said Ashar Nazim, Director Islamic Banking, Ferguson Associates (Pvt) Limited, Islamic Banking Consultants in a statement. “We are seeing strong interest from foreign investors, specially Arabs, to invest in projects in Pakistan through Islamic modes of financing” Ashar Nazim said.
A recent example is Etisalat’s acquisition of PTCL for record US $ 2.6 billion, which is being partly financed through an Islamic facility, he added. Pakistan is becoming an increasingly attractive market with high growth potential, he said, adding, Bank Islamic and Dubai Islamic Bank are the new banks expected to start operations by later this year. This also reflects well on SBP who has been working hard to introduce Islamic banking as a parallel system in the country. “In 5 years time, Pakistan’s Islamic banking industry will be bigger than the current Islamic banking market of Bahrain and Qatar combined.” “By 2014 Pakistan’s Islamic banking industry is likely to equal the current size of UAE and Kuwait markets put together.”
In the emerging scenario, he said, “Ferguson Associates has a very significant role to play in stimulating Islamic banking, capital market and training activities, both for Islamic banks and investors.” Ashar Nazim has recently returned from Bahrain, where he was associated with the Bahrain Monetary Agency - the central bank on Islamic banking.
Re: Islamic banking deposits in Pakistan to reach Rs 780b by 2014
I think we still have to go along way in this sector however recent improvemenets are indeed encouraging.
The main problem is self interpretation of people and they believe that Islamic banking is same as Conventional banking. They needs to be educated on this.
Re: Islamic banking deposits in Pakistan to reach Rs 780b by 2014
Well its supposed to be 100% interest free. But knowing pakis im sure theyre figured out some way to mesh interest in.. with a different name probably.
PS: Just for sake of info.. in Islam both giving and taking interest is STRICTLY forbidden. Just like its not allowed to steal from someone, its not allowed to give or take interest.
Re: Islamic banking deposits in Pakistan to reach Rs 780b by 2014
I don’t think so it is similar to the conventional banking system, in Islamic banking system Riba is not there, rather profit is fixed lets say at the rate of 10% instead of fixing and that's how it is working. However some economist may give better comments.
Re: Islamic banking deposits in Pakistan to reach Rs 780b by 2014
Most of the Islamic banking schemes draw approval from one or more major scholars.
In the London-based Saudi bank that my father used to work for, my understanding is that the scholars (from 4 countries) who certified the bank’s Islamic products as being Shariah compliant did not receive any money from the bank for their services, so you cannot argue scholars sell out to banks for cash.
I believe that if an Islamic scholar grants approval to a banking scheme, then he certainly thinks it’s halal.
Broadly speaking, Islamic banking in broken into 2 hubs. There’s a Bahrain-centred hub that follows fatwas by Arab-Pakistani scholars, and a Kuala Lumpar focused hub that follows Malaysian scholars who have different ideas of what is Shariah compliant.
Re: Islamic banking deposits in Pakistan to reach Rs 780b by 2014
I was talking to a dimwit propent of the virtues of islamic banking. Baccha had recently done some course at LBS and was telling me about his "analysis" of Malaysian Bank asset valauations, comparing the islamic vs. regular banking institutions during the currency crises.
So after a long boring dissertation on the allah sanctioned asset building and man made value creation models, the net-net of it is that..both islamic banks and regular banks suffered equally. Ullu ka paTha wasted 20 minutes of my time to point out that God has no better idea of retaining value in a crises situation than man does. I told him to get me a fking drink and not come into my office for another 2 weeks. We scappred the shariah fund idea as a result. morons!!!