Global business strategy and marketing consultation majors, Mckinsey, Fitch and MTI Consulting, will take centre stage in the Kingdom presenting their research-based studies of the state of the global Islamic banking industry at the 14th World Islamic Banking Conference (WIBC), which begins here today.
With almost 1,000 delegates from over 35 countries attending, WIBC has emerged as the most significant platform for decision-makers to explore new and emerging market opportunities for Islamic finance as well as the largest and most significant gathering of Islamic banking and finance industry leaders anywhere in the world.
The Central Bank Governors of Bahrain and Indonesia Rasheed M. Al Maraj and Burhanuddin Abdullah and Professor Rifaat Ahmed Abdel Karim, Secretary General for the Islamic Financial Services Board would be the keynote speakers. The conference, being held under the patronage of Shaikh Khalifa Bin Salman Al Khalifa, the Prime Minister of the Kingdom of Bahrain, will focus on the financial and regulatory architecture to enable industry growth and containing risks.
The focus would be on the World Islamic Banking Competitiveness Report 2007/08 to be launched at the plenary sessions. A team of McKinsey partners from key international centres will release the report highlighting strategic trends, analysis of the growth and performance of the leading industry players at the event. “It explores the latest developments in Asia, in terms of general market trends as well as government and regulator initiatives to boost the sector. It also highlights the imperative need for Islamic banks to upgrade their internal capabilities and, towards this end, highlighting the challenges and opportunities in risk management as well as the competitive edge that can be gained from best practice processes and operation by Islamic banks,” said said McKinsey partner Ozgur Tanrikulu.
With the booming economies of the GCC nations that are flush with excess liquidity, both with wealthy individuals and government funds, the report has a special look at the untapped opportunities for Islamic banks in asset management, he said.
McKinsey surveys suggested that in Malaysia, Indonesia and the Gulf states, 25 per cent of investors were committed to seeking out and using financial services that were compatible with Shariah principles. Another 50 per cent say they prefer to put their money into Islamic funds where possible, as long as they do not have poorer returns than conventional products. McKinsey said that Islamic banks in general rely too much on the religious credentials when attracting customers, but service was a limitation.
Asset classes offering exciting growth potential and key success factors in Islamic Asset management, challenges to be addressed in risk management portfolios when compared to commercial banks, the rise of Islamic banking in Asia and the key markets propelling growth, strategic marketing for Islamic financial services with focus on product development, branding, service, Marcom, channel operations, areas the Competitiveness Report covered, would come in for discussion at the McKinsey pre conference workshop.
The launch of the new Country Focus session will explore the increasing interest and opportunities for Islamic finance in non-Islamic geographies. For the first time, a high-powered delegation led by UK Trade and Investment and comprising of decision-makers representing major banks and institutions in the UK will be setting up a pavilion, showcasing the emergence of London as a key European centre for Islamic finance.
The incredible growth story of Islamic banking is set to continue through 2008 with significant new players entering the market, while some well established institutions have expanded their geographic footprint and the major international conventional players have further sharpened their Islamic finance capabilities. This has set the stage for discussions over the next two days as WIBC 2007 brings together an unprecedented line-up of more than 60 speakers from the Middle East, Europe, North America and Asia to share new insights into the growth potential of Islamic banking and finance.
“The key focus areas covered to strategically deal with the issues plaguing the Islamic Retail Banking Industry include, Product Development, Branding, Service, Marcom, Channel, and Operations, and we will be presenting a Strategic Framework developed internally at MTI to look at each component separately, and then integrate the sum of the parts to arrive at a holistic solution that is pertinent in today’s landscape,” said Hilmy Cader of MTI Consulting