Islamic banks 'better in crisis'
Islamic banks 'better in crisis'
Indonesian President Susilo Bambang Yudhoyono has called on Islamic banks to take a leadership role in the global economy, amid the financial crisis.
He was speaking at the opening of the World Islamic Economic Forum in the Indonesian capital, Jakarta.
The forum has brought together political and business leaders from 38 countries to discuss the global economic slowdown.
They will also discuss ways to achieve energy and food security.
Mr Yudhoyono said it was time for Islamic banks to do some missionary work in the West.
Islamic financial institutions, he said, had not been hit as hard as their western counterparts because they did not invest in toxic assets.
Banks run in accordance with Muslims laws on interest payments and the sharing of credit risks are seen by many as fairer than traditional banks, less focused on profit and kinder to the communities they work in.
Demand for Islamic financial products has been growing in the Muslim world for years but Mr Yudhoyono said that many in the West were now ready to learn from them.
Islamic law prohibits the payment and collection of interest. Transactions must be backed by real assets, and because risk is shared between the bank and the depositor, there is added incentive for the institutions to ensure deals are sound.
Re: Islamic banks 'better in crisis'
Re: Islamic banks 'better in crisis'
Sounds good. Another link to an article the same topic.
It will be interesting to see how much of the theory works out in practice.
A "down side" to Islamic banking would also be that while the lows are probably not as low, the peaks will also not be as high, and if people want to make money off their investments/savings, they may not like the safety being offset by less profit... and then there are the Daily Mail style headlines if such a model was to be enforced on other banks.
In related Financial news:
AIG reports record $61.7bn loss
Insurance giant AIG has reported a loss of $61.7bn (£43bn) in the final three months of 2008 - the largest quarterly loss in corporate history.
And the firm will receive an extra $30bn from the US government as part of a revamped rescue package.
AIG has already received $150bn in financial support - the biggest bail-out by far of any US company.
Read more @ BBC News
Re: Islamic banks 'better in crisis'
So the US government sponsers Manchester United now??!
Another reason to dislike them (both).
Re: Islamic banks 'better in crisis'
AFAIK The United sponsorship deal is over. in the summer I think.
On the other hand, United are taking money away from the US government - money that can not not be used to fund aggression. Good thing, no?
Believe.
Re: Islamic banks 'better in crisis'
[quote=You]
On the other hand, United are taking money away from the US government - money that can not not be used to fund aggression. Good thing, no?
Believe.[/quote]
LOL!
You're obviously forgetting that Wayne Rooney plays for Man Utd...
Salam
Islamic banks had a code that forbade them
from buying toxic assets which brought down so many other banks in US and UK.
Blair and Brown Governments have said that Islamic financial
institutions in London are leading the way for
worldwide revival of interest free loans and ethical banking.
Omrow