What is the scope of Islamic banks in terms of catering to small and medium enterprises?
I think many banks are now specialising in this sector in the UAE, [although] I don’t have statistics how many are involved. This sector gives you the diversity in consumer banking; they also give you a higher spread than the big commercial bank. This is a sector which has its own risk criteria. Has it matured? No. But today we are dealing with some corporate names that were 10 years ago the size of SMEs today. Talking about harmonisation, isn’t it true that Islamic banks lack scale, their products are complex, and there is no global regulatory body. I don’t think there will be one global regulatory body for Islamic banks. The management of the bank will have to follow the regulatory body of the country it is operating in. Some of these countries have laws that specialise for Islamic banks, for example, more extensive laws for Bahrain and Malaysia. Overall, Islamic banks have learnt to live with that kind of environment, to adapt and comply with the regulations of the countries concern
