Where are the Islamic banks on financial intermediation?
I think Islamic banks have managed to jump into this quicker than conventional banks in this country. It was a domain mostly controlled by foreign banks. Islamic banks have built a very good reputation and stand a good chance to take this outside the region. 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
