Qatar’s Islamic finance crackdown may hurt shariah industry

Author: | Published: 10 Feb 2011

Qatar Central Bank (QCB)’s decision to force international banks to separate their conventional and Islamic finance lending entities may hurt the wider shariah -compliant financing industry.

"This may be a setback for the industry as a whole," said Samer Eido from Simmons & Simmons in Doha. "Instead of encouraging people to come to Islamic banking … this will scare away people and reduce the market share of Islamic banking generally."

The ban may also damage Qatar’s reputation as a financial centre. One bank counsel said that if the bank is looking to expand into new markets, decisions such as this don’t help the country’s cause.

"If you can’t offer...