182-185 Noor Bank@L8:Bab Al Shams
9/8/2008
4:41 PM
Page 183
Islamic banking refers to a system of banking or banking activity that is consistent with Islamic law ‘Sharia’ principles and guided by Islamic economics. In particular, Islamic law prohibits usury, the collection and payment of interest, also commonly called ‘riba’ in Islamic discourse. In addition, Islamic law prohibits investing in businesses that are considered unlawful, or ‘haraam’, such as businesses that sell alcohol or pork, or businesses that produce media such as gossip columns or pornography, which are contrary to Islamic values. In the late 20th century, post 9/11, a number of Islamic banks have been created, to cater to this particular banking market which is gaining ground worldwide. recent report by financial research firm, Moody’s Investors Service, values the Islamic finance industry worldwide at around US$700 billion. This figure is expected to increase as more funds, investors and financial institutions turn towards Islamic finance to grow the value of their portfolios and stay within the remit of an ethical business model – Shari’ah style. One reason for the sector’s expanding popularity, is its moral basis rooted in compliance with the tenets of Sharia Law, as Islamic finance prohibits usury for instance, which is the collection and payment of interest upon which standard western banking methods are based. Neither does it invest in businesses that are considered ‘haraam’, meaning contrary to Islamic law. Such principles also offer advantages over conventional banking systems, observes Hussain Al Qemzi, Group CEO, Noor Islamic Bank, a seasoned banker with over 26 years of experience . “One of the main reasons for the popularity of Islamic banking is that it provides a relatively low-risk investment option for both consumers and corporate customers,” he feels. “Investors have strong faith in Islamic alternatives, which have proven to be credible, steady and socially responsible – both regionally and globally. As a result, more conventional banks are entering the Islamic finance arena by introducing Shari’ah compliant products and services. “Also, while the conventional banking system is currently in turmoil due to the credit crunch, Islamic finance continues to perform strongly as it does not rely on leveraged debt”, he explains. Nevertheless, some analysts believe that local banks remain vulnerable to a fall in UAE property prices, estimated as the world’s second most expensive after London. Furthermore, leveraged or otherwise, debt in the GCC is on the rise
A
Best of Dubai
183
Noor Islamic Bank Wins "Best New Islamic Bank" Award Dubai: 16 April, 2008 - Noor Islamic Bank PJSC won the "Best New Islamic Bank" Award at the International Islamic Finance Forum, taking place in Dubai this week. The award was presented to Hussain Al Qemzi, Group CEO of Noor Islamic Bank.
with escalating inflation, as GCC currencies remain pegged to a weak dollar. What implications does this have to the UAE dirham peg and to the health of the UAE banking industry? “We are not harmed by the credit crunch as the banking sector in both the UAE and wider GCC has proved to be stable and steady, which is an incentive to us at this stage,” Al Qemzi explains. “It is only up to Central Bank to decide on the dirham status. As for Noor Islamic Bank, we are a UAE bank and our holdings are in UAE dirham.”
attract global talent. A fitting move for an institution with the long-term ambition to be the world’s leading global Islamic Bank. “In global markets you have established conventional banks that offer Islamic products, and you have local Islamic banks. Noor Islamic Bank is the first global Islamic bank,” maintains Al Qemzi. “At present we are operating from eight locations across the UAE. During the next five years, we not only intend to increase our geographical scope across the Middle East, but also plan to operate in Europe and the Far East.”
Noor Islamic Bank Noor Islamic Bank was launched in December 2006. But it wasn’t until January 2008 that it opened its doors for business. “The 12 months after the launch were not only spent formulating our strategic vision,” explains Al Qemzi, “but also our products, services, processes, value proposition and human talent. “At the time of launch, we had around 350 employees from different nationalities and regions. This number is now growing as we build our talent pool to address the needs of our customers.” Services include the entire spectrum of both consumer and corporate banking. The Bank also has a dedicated team that caters for smallto-medium sized businesses - a fast growing sector as free zone opportunities increase within the region. The Bank also recently hosted a delegation of 23 MBA students from top US business schools as part of its ‘community outreach programme’ to
Looking to the future Despite suggestions otherwise, the UAE banking sector still offers room for growth, believes Al Qemzi. “Some analysts say that the sector is overbanked, but I think that that opportunities still exist for institutions that want to be innovative,” he offers. “At the same time, the UAE government is keen to see consolidation within the industry, in order for local banks to complete evenly with larger international financial institutions. The recent merger between Emirates Bank and National Bank of Dubai is a case in point, as it has created one of the largest financial institutions in the region. “For ourselves, we are looking forward to growing our business. At Noor Islamic Bank, our focus is to go beyond preconceived conceptions of what Islamic banks are currently, to defining what an Islamic bank can be.”
Tel: +9714 426 8888 www.noorbank.com