The launching of the multi-million dollar Halal investment company in London this July is one indicator of the growing salience of Islamic banking institutions not just in Muslim countries, but in the West as well. Islamic banking, in its modern context, first emerged in Egypt in 1963, when the Mit Ghamr Bank began an experimental project offering interest-free banking facilities for its customers. This project was a modest success, leading the bank to open four new branches in Egypt by 1967. Since then, Islamic banks have become increasingly important in many other countries as well.
All indicators suggest a mushrooming of such institutions in the years to come.
Even certain western banks have evinced interest in starting Islamic banking schemes. These include goldman sachs, Kleinwort Benson and ANZ Grindlays. Last year, Citibank launched an Islamic bank in Bahrain and certain other similar projects might be in the pipeline in the future. In some Muslim countries, Islamic banks seem to have grown fairly rapidly in the past few years. The Kuwait Finance House and Pakistan s Muslim Commercial Bank have seen their assets grow by ten per cent per annum recently.