The global crisis has created great opportunities for Islamic banks, in order to prove the feasibility of the methods they follow, and how such methods eased the effects of the crisis, said Emad Al- Menaie, chairman and managing director of Liquidity Management House (LMH), which is fully owned by Kuwait Finance House (KFH). In his speech at the 6th Islamic Financial Services Conference (IFSB) that was held lately in Singapore and was attended by six Asian central banks governors, he said the countries should have more profound cooperation to overcome the current crisis, in addition to setting regulations to avoid such crises in the future, since the globalization and lack of boundaries puts great responsibility on the economic players who influence the global economy. He said Islamic banking sets principles that go hand in hand with economic and financial practices, in addition to avoiding speculations. It is worth noting that KFH Group has been a member in the summit since 2003. Moreover, Al-Menaie said KFH's expansion in South East Asia and opening KFH-Singapore reveals the great potential that awaits Islamic banks in these markets, and reinforces the efforts that support the opening of new markets, in addition to creating new products and services that suit these markets, where KFH participated in major developmental projects in China, Malaysia, and Indonesia, that include real estate, infrastructure, industrial, transportation and services development. He revealed that KFH-Singapore has signed four investment agreements in Singapore, such as setting a health care fund, and investing in the biggest, most specialized companies in the iron industry and the installment of pieces of iron, which as business that extends to reach Singapore, Malaysia, and China. KFH uses Singapore as a platform to play a more extensive role in its market and the neighboring markets. Meanwhile, the market for Islamic insurance, or Takaful, may hit $7.7 billion by 2012 as its products are offered to large untapped Muslim populations across the globe, according to a report released on Tuesday. Global Takaful contributions rose to $3.4 billion in 2007 from $2.5 billion in 2006, with contributions in Saudi Arabia and Malaysia, the two largest Takaful markets, totaling $1.7 billion and $797 million in 2007 respectively, consulting firm Ernst & Young said in the report. “Takaful markets now span much of the globe but there still exists a large, expanding and untapped Muslim population on almost every continent,” said Sameer Abdi, head of the company's Islamic Finance Services Group. Compared to the reported losses of almost $350 billion of conventional insurers and government-supported enterprises in the United States, Europe and Asia, the Takaful market has shown resilience in the global economic crisis, the report said. However, major Takaful operators saw a decline in the returns-on-equity in the last quarter of 2008. “A young population in core Takaful markets will need more coverage as government subsidies decrease and more families require private coverage,” the report said. “Regulatory support and framework, insurance legislation and compulsory coverage will facilitate its growth in the medium term.” The Gulf Arab States, Malaysia and Sudan are the top three Takaful markets while the Indian subcontinent, Indonesia, Egypt and Turkey remain the least penetrated Muslim markets, Ernst & Young said. __
