Islamic banks have weathered sub-prime crisis well: Regulators: Asia One

By Gabriel Chen

ISLAMIC banks and financial institutions managed to avoid the fallout from the sub-prime crisis, largely because they refrained from investing in toxic assets that were deemed 'un-Islamic'.

And this prudence has put Islamic finance in good stead with investors looking for safe havens, said Professor Rifaat Ahmed Abdel Karim, secretary-general of the Kuala Lumpur-based Islamic Financial Services Board (IFSB).

The IFSB is an umbrella group of Islamic financial regulators. It was formed in 2002 and counts Saudi Arabia, Qatar, Indonesia, Bahrain, Sudan, Pakistan and Singapore as members.

Prof Rifaat, who is in Singapore for the IFSB summit this week, told The Straits Times yesterday that a lot of lessons could be learnt from the financial crisis.

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