www.todayonline.com - Singapore is challenging established wealth centres more fiercely than anywhere else in Asia, according to UBS bank and Campden Research. Yet, in Islamic banking, it lags behind.
Even though Singapore
has had Islamic banking since 1995 and there are investments such as the
NTUC Income Takaful Fund, banks generally offer only a few choices such
as savings and checking accounts. Some banks have far less.
DBS' Islamic Bank of Asia offers corporate banking and asset
management, for example, and not consumer products. And when Standard
Chartered Bank launched new Islamic financial solutions for private
banking clients in June, it did so in London, Geneva, Jersey and Dubai -
but not Singapore, where it is still working on regulatory approvals. (source)
Just across the causeway though, there are Islamic banking
products from mortgages and credit cards to savings accounts and
investment services. PricewaterhouseCoopers calls Malaysia "a leading
international and regional hub of Islamic finance". Standard Chartered
sees such potential it is making Kuala Lumpur its global hub for Islamic
With relatively few products in Singapore, growth remains slow.
Even though Monetary Authority of Singapore (MAS) Managing
Director Ravi Menon has said that "Singapore aims to encourage financial
institutions here to grow their suite of products and services for the
Islamic finance industry", there is little specificity about what might
drive growth. Myriad issues, from a lack of products and talent to an
opaque regulatory structure, seem to hinder expansion.
Deloitte M&A partner and Islamic finance specialist Suresh Marimuthu
said that, while Singapore has the fundamental framework for Islamic
banking to grow, little has been done to encourage expansion. A separate
blueprint and regulatory framework for Islamic banking and capital
markets, new licensees, more attractive tax structures and more Islamic
banking talent are needed, he said. With these, Islamic banking here
could grow quickly, perhaps even surpassing Malaysia.
Richard Hartung is a financial services consultant who has lived in Singapore for more than 20 years.
Source: http://www.todayonline.com/Business/Wealth/EDC120801-0000005/Potential-for-growth-in-Spore - Aug 1, 2012