Series of topics and announcements during the first day of the First Retail Islamic Banking conference

Dr. Mohammad Khalfan bin Karbash, UAE Minister of State for Finance & Industry, inaugurated the conference and highlighted the importance of having more specialized events to promote the maturity of the Islamic Finance market.

Commenting on the overall purpose of the conference, Tariq Rifai of Failaka International, Inc., one of the two companies organizing FIRBC, said: "Until few years back, Islamic Banking's main "raison d'être" was to cater to high-net-worth individuals and institutions", explaining that "nowadays, Islamic banking has evolved so that it has becoming widespread among the masses, raising the importance of Islamic retail banking."

The keynote address was given by the Royal Professor Unko Aziz, founder of Tabung Haji, a non-banking Malaysian institution which aids people save for hajj. Dr Aziz explained how the concept can be duplicated in other countries with large Muslim populations. Duncan Smith, the head of ABC Islamic Asset Management, discussed the future trend in Islamic finance, saying that "Demand for Islamic financial and banking products has been maturing, requiring more sophistication in product and service development to fulfil increasing needs." He added, "This is the rationale behind ABC Islamic's launch of a new retail-banking brand that will offer retail products based on Murabaha and Ijara". Deutsche Bank portrayed its equity builder certificates, which have a low minimum entry level, thereby aimed at retail clients with low income.

The conference also detailed the mechanics of new Islamic Ijara products, which can be structured as a non-asset backed Islamic financing tool. The lecture was presented by Suhail Zubairi, Vice President of Shariah Structuring Documentation and Product Development at DIB. Keith Leach from ABC Islamic Asset Management gave an overview on Islamic Banking in Europe based on the experience of the Bank's London office, which services non-Islamic countries.

Kuwait Finance House was used as a case study to demonstrate the success of the Islamic banking experience in the Gulf and south East Asia. The first session also detailed the role of conventional banks in promoting Islamic products. Maybank, the second largest bank in Malaysia, was used as an example.

The conference also tackled legislation and its effect on the proliferation of Islamic finance. The conversion of the Islamic House of Britain to a full-fledged bank was detailed by Mohamed Paracha from Norton Rose, one of the major law firms in the UK. Significant UK legislative developments were revealed further as the Bank of England hosted Iqbal Asaria from the Islamic Council of England to discuss Islamic legislation affecting financial institutions. Rahan Huda illustrated the significance of legislation by using the example of Islamic home financing in Canada.

Asset-backed securities were also discussed and the securitization of the Al Dar Investment receivables was given as an example. FIRBC also covered Real estate Islamic finance, as Meshal Al-Ameri, Managing Director of Munshaat Real Estate Projects Co. detailed the first Islamic time-share structure for a project in the Holy city of Mecca.

Speakers at the FIRBC also described why Islamic retail banking has not been prosperous in Organization of Islamic Countries, and highlighted the experience of the first Islamic bank established in Nigeria.

The first day of the FIRBC was closed by the Shariah School, which discussed several pertinent issues, such as the choice of Murabaha versus Ijara versus Musharaka in a Tawarruq structure, which is a contract of convenience mortgages. Issues also discussed included the re-mortgaging or credit extensions allowed under the Shariah, benchmarking Islamic mortgages towards a market rental index benchmark versus LIBOR, credit card contracts to cover payment delays and defaults, a deposit insurance scheme, and the marketing and misselling of Islamic banking products.