Britain's Bank of London and the Middle East (BLME) is aiming to grow its assets by 15% this year following the significant rise in Islamic finance activity in the Gulf region.
The London-based Shariah compliant bank is targeting more business from the Middle East, in its capital markets and wealth management divisions, with the opening of a Dubai office later in 2013.
Its new office will be housed in the Dubai International Financial Centre.
The total assets of BLME that was set up six years ago and owned primarily by Kuwaiti shareholders, increased to more than £1bn ($1.52bn, €1.18bn) at the end of 2012.
The UK's largest standalone Islamic bank plans to attract more business from neighbouring countries such as Qatar and Saudi Arabia with its presence in the United Arab Emirates, BLME's CEO Humphrey Percy told Reuters in an interview.
Islamic finance activity is rising in the Gulf region, especially with increased issue of Islamic bonds known as sukuk.
In January, Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, announced a plan to place Dubai at the centre of the global Islamic economy, replacing Bahrain plagued by social unrest.
The office in Dubai would help identify opportunities for club transactions, syndications and for wealth management offering, Percy noted. However, the Dubai office will be a representative office, promoting the bank's services. The bank is not seeking a full branch license or a presence in other countries and it will not operate any investment funds there.
In 2012, BLME returned to profitability with a net operating profit of £5.5m, after posting a £10.8m loss in 2011. It operates in three core business areas including wealth management, corporate banking and treasury, adhering to principles of Islamic law that forbid charging or paying interest, among other norms. The business sectors on focus include healthcare, transportation and real estate.
(International Business Times / 17 May 2013)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com
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