The credit crisis is boosting Islamic finance, a senior Credit Suisse banker said, luring investors in search of assets not tainted by the turmoil hitting other parts of financial markets.
But the industry needs more liquid instruments before it can offer wealthy Muslim investors asset allocation that is as effective as traditional investing, the head of the Swiss bank's Islamic investment business told Reuters.
"If you invest in Islamic finance products, you tend not to be sensitive to developments in interest rates," Zurich-based Fares Mourad said on February 04.
"I've seen asset managers in the United Kingdom who are saying that they would like to include Islamic investments in their total asset allocation," he said.
Islam bans charging interest, making sukuk - or Islamic bonds - immune to the big swings in interest rate expectations the credit crisis has caused in bond markets.
Credit Suisse, the world's fourth-largest wealth manager, said its Islamic banking business was growing at a double-digit pace, though staffing so far was modest, with seven people in Dubai and two based in London and Switzerland each.
Comments
Comments are closed.