A temporary end to the Islamic banking dream in Europe?
The Islamic Bank of Britain (IBB) was bailed out this week by a group of Qatari investors, which are injecting £20 million worth of capital. With the bank struggling to grow its income, the outlook for retail Islamic finance in the UK, and indeed Europe, looks bleak. However, the financial difficulties of the bank are largely a result of the current economic conditions and regulatory environment, rather than underlying demand. The longer-term prospects remain attractive as a niche growth market, although the demand for supporting core systems in Europe will remain in a hiatus for the next couple of years.