In the backdrop of a double digit growth in Islamic banking and growing appetite for Shariah compliant businesses in the market, a leading banking group Ahli United Bank (AUB) yesterday announced the launch of Islamic banking business under the name of Al Hilal Banking Services in Bahrain. AUB is looking at 50 per cent of its overall revenue stream coming from Islamic banking operations in few years time while doing business side by side with its conventional banking activities where it enjoys a distinctive position. AUB had reported a consolidated net profit of $225.9 million for the nine month period ended 30 September 2007, an increase of 37.5 per cent compared to the same period last year. As of 30 September 2007, total assets for AUB stood at $21.9 billion.
Bahrain has become the third country after the UK and Qatar for the AUB to launch Al Hilal Banking Services, an independent Islamic banking under the umbrella of AUB, a senior official at the bank said yesterday.
Abdulla Al Raeesi, Deputy Group CEO, AUB said that the decision was a result of the growing demand for Islamic banking and the trust that customers have placed on Al Hilal Islamic Banking products and services. “AUB will be expanding its Islamic Banking branch network in Bahrain. This is a testimony of the AUB’s commitment to foster Islamic Banking and to provide a comprehensive set of retail banking products and services”
The Deputy CEO said that the bank was also keen to enhance Islamic banking operations across the Gulf, Egypt, Iraq and Iran in addition to the other potential markets.
Al Raeesi said: “AUB met all the requirements of the Central Bank of Bahrain to enter into the business of offering Islamic banking products and services in Bahrain.”
The expansion of Islamic Banking operations in Bahrain is a result of the AUB Group’s strategy to provide greater Islamic product offerings across the different banks in the Group. The launch of Al Hilal Islamic Banking Services in Bahrain follows its successful launch in Qatar by Ahli Bank QSC and in the United Kingdom by Ahli United Bank UK. AUB, being a leading regional bank, has gained a wealth of knowledge operating in diverse markets across the region, helping it to offer a highly competitive product range across different countries. Al Hilal Islamic Banking Services currently has two branches in Bahrain in Arad and Sanad while third branch will be in Riffa area.
“Under the guidance from our esteemed shariah board, Al Hilal is geared to become one of the leading Islamic banking services providers in Bahrain,” added Al Raeesi. Following the launch of Al Hilal Islamic Banking Services in October 2007, Ahli United Bank (AUB) continues to enhance its Islamic banking offering to provide an unmatched range of products and services to its valued clients within Bahrain.
Professor Ali Al-Quradaghi, Chairman of the AUB shariah Board said: “We wish to acknowledge the efforts made by the Al Hilal Islamic Banking Division at AUB in going the extra mile to ensure that all contracts and financial products are in accordance with the principles and laws of the noble Islamic shariah. We wish to see Al-Hilal Islamic Banking Services grow to become one of the leading Islamic financial services providers in the region”.
The shariah supervisory board for AUB’s Al Hilal Islamic banking services include prominent scholars from around the Middle East comprising of Dr Ali Muhyealdin Al-Quradaghi, Chairman and members, Dr Fareed Hadi and Dr. Abdul Aziz Qassar. The shariah Supervisory Board works independently and is free to review and comment on all contracts and transactions. AUB strictly follows the required conditions of the shariah Board in order to ensure that all operations of Al Hilal Islamic Banking Services comply with shariah. AUB uses a modern and sophisticated operating system to maintain separate books and records for the Al Hilal Islamic Banking Division and ensure that funds and operations are fully segregated from the conventional banking operation.