First German Muslim bank prepares to open
Published: 19 Jan 2010 09:04 GMT+01:00
Updated: 19 Jan 2010 09:04 GMT+01:00
The Kuveyt Türk Beteiligungsbank, based in Istanbul and Kuwait, is renovating its offices in the south-western city ahead of a planned opening in March, when the plan is to offer day-to-day banking services to the large Muslim community in the region.
Although there is already an Iranian finance institute in northern Germany, it is mostly concerned with export businesses, not with individual customers.
Islamic banking means that a fee is paid for a loan rather than interest, and investments are made only in companies considered to conform to Muslim ethics – this bans buying shares in firms which deal with alcohol, pork or weapons. Highly-speculative investments are also not allowed.
The concept could win over non-Muslims too, as far as Zaid el-Mogaddedi, consultant with the Frankfurt-based Institute for Islamic Banking and Finance, is concerned. He said that although Muslim banks had also been affected by the financial problems of the global financial crisis, they had survived relatively unscathed.
This combined with the ethical element made the idea attractive to new customers. “I believe that this business model could serve as a good example for the new regulation of western banks,” he said.
Michael Gassner, from the Central Council of Muslims, said a Muslim bank could also contribute to better integration in Germany. He said around three quarters of the four million Muslims living here felt closely-tied to the Islamic traditions, with a fifth supportive of the idea of Muslim finance.
“Literally put, he who buys a house feels at home,” he said.