centres in the european continent. firstly, the supply of sharia - compliant finance products is still largely geographically constrained. the bulk of islam - compliant financial transactions take place in financial centres in the middle east, malaysia and – at european level – in london. consequently, it is difficult for the large number of muslims who live in continental europe, for example in france or germany, to access these services. german financial institutions ’ involvement in islamic finance has so far also largely been limited to these financial centres. there have been, and still are, initiatives – for example, by the federal state of saxony - anhalt and by commerzbank and deutsche bank – to establish halal finance products in germany as well. however, so far these efforts have had rather limited success. one reason for this brings me to the second aspect of why, in my opinion, a gap still exists between the supply of and demand for halal products : the products are still aimed at a limited target demographic. the bulk of islam - compliant financial products that are available outside traditional islamic states and the united kingdom are primarily aimed at wealthy private and institutional investors, mostly in the form of “ sukuks ”, also known as islamic bonds. hardly any services are aimed at the more middle - class muslim population of continental europe. thus for the approximately 3. 5 million muslims who make their home in germany, an estimated 15 - 20 % of whom have a keen interest in islam - compliant bank products, there are hardly any possibilities for financing homes or to invest their assets in accordance with the rules of their faith, while at the same time productively. although the above - average saving rate of muslims living in germany clearly indicates that market potential is waiting to be tapped, the investment products available to this target group are virtually inaccessible or not known. one explanation is that institutions that offer islam - compliant finance products in germany do not advertise these products. therefore, anyone who wants to invest in halal finance products in germany still has to explicitly ask for them at a bank. furthermore, since, as already mentioned, the products are almost exclusively aimed at very wealthy investors from islamic countries abroad and not at the german muslim population, the product information is mostly only written in english. above all, banks located in continental europe face the challenge of using attractive islam - compliant services – especially in the retail banking area – as well as target group - oriented marketing to tap the dormant capital of the muslim population. however, a flourishing islamic finance

deutsche bundesbank in the middle of this year, i worked for many years as state secretary in the federal state of baden - wurttemberg where, above all, i dealt with issues relating to the integration of citizens with migrant backgrounds. i have always taken these issues very seriously. in fact, in 2004, i was the first politician in the baden - wurttemberg government to hold a speech at the yaruz sultan selim mosque in mannheim – germany ’ s largest – on intensifying cooperation. as i mentioned previously, there are currently around 3. 5 million muslim citizens in germany. according to a study carried out by the university of tubingen, by 2030 this number will have almost doubled. although a large part of the muslims living in germany have integrated well, unfortunately, there is also often a tendency for muslims to segregate themselves from their western surroundings. often families and young people whose parents or grandparents came to germany from the arab states and turkey shut themselves off from german society. to be quite honest, it was for this reason that i was initially rather sceptical towards the issue of " islamic finance in germany ". my concern was that the creation or support of additional islamic financial services would support the creation of parallel societies in germany. i now believe that the development of a range of halal finance products – particularly in retail banking – would make an important contribution to supporting the integration of our muslim fellow citizens. if this enables these citizens to play an active role in business life in germany and to build up material assets without conflicting with their beliefs, it will support, in particular, those middle - class muslims who are ready and willing to integrate. the example of a stable and financially successful middle class, in my opinion, will provide positive incentives which should prevent the development of parallel societies. ladies and gentlemen “ islamic finance – the european challenge ” : the challenges faced by banks, supervisors and legislators as a result of islamic finance are by no means minor. i do believe, however, that it is worth the effort to face these challenges, not only both from a business and financial perspective but also most significantly for socio - political reasons. let us take on these challenges together. i would like to finish by wishing you all a successful and fruitful conference and hope you are able to make useful contacts. thank you very much for your attention.