Business | Banking
Birmingham centre for Islamic finance
Once an industrial powerhouse, Britain's second largest city Birmingham is eagerly rebranding itself as a key European centre for retail Islamic finance.
- Reuters
- Published: 23:18 July 12, 2008
London: Once an industrial powerhouse, Britain's second largest city Birmingham is eagerly rebranding itself as a key European centre for retail Islamic finance.
Britain sees itself as the European leader in providing sharia-compliant financial services, aiming to serve both domestic Muslim markets as well as tapping into the vast wealth of Gulf investors keen to access Western assets.
London dominates Britain's financial sector but, with a growing Muslim population of about 250,000 and two flights a day to Dubai, Birmingham seems well-placed for the new sector.
"It's like in America's Silicon Valley - you will get clusters of expertise in certain areas," said Stephen Amos, spokesman for the Islamic Bank of Britain (IBB). "The two areas of expertise are always going to be London ... and hopefully Birmingham."
Retail bank
The IBB - which holds £130 million ($256 million) and was the first stand-alone Islamic retail bank in the European Union - has been based in Edgbaston, a suburb of Birmingham, since its inception in 2004.
At a conference on Islamic banking this week in London - where the British government again repeated its intention to issue its own sukuk Islamic sovereign debt in future - promoters from the region were pushing the city's case.
"Birmingham is generally acknowledged to have developed expertise in this emerging market, and we have a very well-rooted, successful Muslim community in the city," said Mike Loftus, from Locate in Birmingham, a government body promoting investment in the city.
The IBB's Amos agrees. "It's an excellent location for an Islamic bank," he said. "Outside of London, Birmingham has the largest professional services sector, and it is a growing financial services centre."
Others were more realistic about Birmingham's reach. "Birmingham has potential, especially when you are talking about retail Islamic finance and especially when you talk about the UK," a spokeswoman for Bank of London and the Middle East said.
Professor Rodney Wilson, head of the Islamic finance programme at Durham University, said Birmingham's firms were not competing with Gulf investment subsidiaries based in London.
"What they're aiming at long term is to have a substantial retail presence and penetration in the UK Muslim community. There's a place for that," he said.
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