- Studies in Islamic Finance, Accounting and Governance series
Edited by M. Fahim Khan and Mario Porzio
Chapter 15: Islamic Banking in the United Kingdom
15. Islamic banking in the United Kingdom Rodney Wilson This chapter examines the experience of Islamic banking in the United Kingdom since 1980, focusing on wholesale operations, retail saving and investment products and home finance. Regulatory and legal issues are discussed, as well as institutional developments and the challenges of serving the British Muslim community of over 1.8 million people. The operations of exclusively Islamic banks are examined, notably the Al Baraka International Bank during the 1980s and early 1990s and the Islamic Bank of Britain from 2004. The activities of conventional banks offering Islamic facilities are also analysed, the focus being on the United Bank of Kuwait and its successor the Al Ahli United Bank, and more recently HSBC through its Amanah Islamic finance subsidiary and Lloyds TSB. SHARI‘AH-COMPLIANT LIQUIDITY MANAGEMENT Initially the major Islamic finance activity involved wholesale operations, with banks in London providing overnight deposit facilities for the newly established Islamic banks in the Gulf. These Islamic banks could not hold liquid assets such as treasury bills, which paid interest, but the joint venture Arab banks in London, such as Saudi International Bank and the United Bank of Kuwait, accepted deposits on a murabaha mark-up basis, with the associated short term trading transaction being conducted on the London Metal Exchange (Maroun 2002, 163–75). Although the staffs of the joint venture banks were mainly British and non-Muslims, they became increasingly well informed about Shari‘ah requirements regarding finance, and were able to respond to the demands...
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.