The Global Impact of Islamic Finance
by Jin-ah Kim & Ahmad Y. Bassam, Contributing Writers
Issue date: 4/23/07 Section: News
Ward noted that Islamic financial institutions have grown at rates approaching 20% a year in the past few years, and that assets of these Islamic institutions exceed $350 billion. Additionally, most large financial institutions are involved in Islamic finance by supplying financial tools in over 75 countries, and there exists a Dow Jones Islamic Market Index that tracks companies that operate in a manner compatible with Islamic law. The events of September 11th, Ward said, ironically influenced on Islamic finance positively. For example, Muslim-Americans who previously invested abroad in Middle Eastern markets stopped doing so after funds that were invested in these countries were frozen post-9/11. As a result, many sought for domestic alternatives in which to invest their money and began to ask financial institutions to create products, such as no-interest accounts that were in line with their beliefs. Additionally, increased demand for Islamic finance funds came from Middle Eastern investors who wish to diversify their assets by investing in North America and Europe. Ward added, "It was the boom of Islamic finance that was driven by both micro-economic factors and political religious factors."
Aamir A. Rehman (HBS '04), who served as president of the Harvard Islamic Society in college and is a founding co-president of the Islamic Society at the HBS, covered the current state of Islamic finance. Rehman, a former consultant at BCG and the Monitor Group, spoke based on his experience of leading strategy development for the HSBC Group's Islamic finance business. He stressed the need for professionals who have an understanding of finance and Islamic law as the demand for Islam-compatible financial tools grows in the current marketplace.
Audience member, Fahad Ashraf, a Harvard Dental School student, said "The speeches were very interesting and informative. The lecture was helpful to understanding the general state of Islamic finance, but it would have been better if they covered specific Islamic finance products in the U.S. market."
Aamir A. Rehman (HBS '04), who served as president of the Harvard Islamic Society in college and is a founding co-president of the Islamic Society at the HBS, covered the current state of Islamic finance. Rehman, a former consultant at BCG and the Monitor Group, spoke based on his experience of leading strategy development for the HSBC Group's Islamic finance business. He stressed the need for professionals who have an understanding of finance and Islamic law as the demand for Islam-compatible financial tools grows in the current marketplace.
Audience member, Fahad Ashraf, a Harvard Dental School student, said "The speeches were very interesting and informative. The lecture was helpful to understanding the general state of Islamic finance, but it would have been better if they covered specific Islamic finance products in the U.S. market."
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