Source: PropertyWire, 03 Sep 2008
London is emerging as the key centre for Islamic finance outside of the Middle East as financial institutions clamber to become part of a growing market. Currently it is estimated that Islamic banking manages funds of $200 billion. It is predicted to increase by up to 15% a year and be worth a trillion dollars by 2010.
Although Sharia-compliant finance has existed in some form for hundreds of years the world’s first Islamic bank was founded in 1975 and it is only in the last five years that this area of finance has surged.
Regarded for many years as outside the mainstream, Islamic finance has been boosted by a number of factors. Firstly, at a very basic level, there are more Muslims in the world seeking mortgages, investments, bonds and specialist finance products.
What used to be a sector for high net worth individuals is now open to the fast growing Muslim middle classes.
Secondly, economic growth in the Middle East, fuelled by high oil prices, has created an increased demand which local financial markets have been unable to keep up with. As a result Middle Eastern investors are looking for suitable alternatives.
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