Islamic Bank of Britain
From Wikipedia, the free encyclopedia
| Islamic Bank of Britain | |
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| Type | Public (LSE: IBB) |
| Founded | 2004 |
| Headquarters |  Birmingham, UK |
| Key people | Mohsen Moustafa, Chairman Gerry Deegan, Managing Director |
| Industry | Finance and Insurance |
| Products | Banking |
| Revenue | ▼ GBP£8.83 million (2006) |
| Net income | ▲ GBP£2.85 million (2006) |
| Website | www.islamic-bank.com |
The Islamic Bank of Britain plc (LSE: IBB) is a commercial bank in the United Kingdom, established in August 2004 to offer Sharia compliant financial service products to British Muslims. The bank has six branches in London, Birmingham, Manchester and Leicester. It is the first British bank claiming to operate entirely according to Islamic principles.[1], although non-Muslims are also allowed to hold accounts.
The bank states that it runs on four values:[2] faith, value, convenience, trust. Faith is an important factor for the bank, and accordingly branches close on Friday afternoons to allow the staff to attend Jummah (Friday) prayers[citation needed]. The bank also has a Sharia Supervisory Committee to ensure that its products are compliant with Islamic teachings.[3]
During four years of its operation it has made a good impact in Islamic Shariah Market. As at end of 2006, its customers totalled 30,814, increasing by 120% from the previous year. [4]
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[edit] History
The Islamic Bank of Britain was formed by a group of investors from the Middle East to take advantage of the growing market for Sharia compliant financial services in the UK. In July of 2002, consultants and advisors were employed to confirm if such type of bank was needed and if it would be accepted by the Financial Services Authority, FSA.
Potential investors were invited, mainly from the Gulf, who put together a Private Placement document which allowed the company to raise £14 million in start-up capital by early 2003. In the same period, its first Managing Director, Michael Hanlon was recruited. Later that year, a draft business plan was proposed and formal application to the FSA was submitted.
By August 2004, the FSA granted authorisation of the bank [5], and subsequently led to the Islamic Bank of Britain available to the public.
[edit] Business Model
Unlike conventional banking, the Islamic Bank of Britain uses an alternative business model. It is based on Islamic Banking and since Islamic law does not allow the charging of interest, there comes increasing controversy for Muslims to hold bank accounts or mortgages with conventional UK banks. Hence, the Islamic Bank of Britain was created with this mindset.
Although in recent years, this has begun to change; with many UK banks seeing the potential to offer specifically tailored services for Muslim customers. However, The Islamic Bank of Britain is the first UK bank in its single corporate entity to offer an entirely Sharia'a compliant banking, unlike the larger banking conglomerates such as HSBC which offers Sharia'a compliancy, but also utilises a different business model for its conventional banking system.
[edit] External links
- www.islamic-bank.com - Islamic Bank of Britain
- Q & A Islamic Finance(BBC) -
[edit] References
- ^ First Islamic bank to open in UK (html). BBC (2004-08-9). Retrieved on 2007-09-21.
- ^ Ethical UK bank (html). Islamic Bank of Britain. Retrieved on 2007-09-22.
- ^ Ethical UK Bank, IBB
- ^ IBB Annual Report 2006 (pdf). Islamic Bank of Britain (2006-12-31). Retrieved on 2007-09-21.
- ^ Regulation and Islamic finance (html). FSA (2006-06-13). Retrieved on 2007-09-22.
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