Islamic Financial Services Board
2 November 2002 Warren Edwardes interviewed by Michael Bilde, Journalist, of the Danish business newspaper DAGEN in connection with the launch of The Islamic Financial Services Board. Edwardes says "I hope that it will provide an impetus for the industry. Islamic banks, as is the case with conventional banks not just have to be properly managed but they have to be seen to be well managed. But the IFSB should have teeth and be prepared to praise and shame and not be just another excuse for well-meaning meetings." article
1. Will the IFSB
have any impact on the way Islamic banking is conducted?
Warren Edwardes, ceo of London based financial product innovation and risk consultancy, Delphi Risk Management and a frequent conference speaker, writer and consultant on Islamic Banking and Finance is delighted with the launch of the IFSB.
Edwardes says "I hope that it will provide an impetus for the industry. Islamic banks, as is the case with conventional banks not just have to be properly managed but they have to be seen to be well managed. But the IFSB should have teeth and be prepared to praise and shame and not be just another excuse for well-meaning meetings."
2. Is the IFSB a result of the Islamic institutions' own desire to strengthen the framework or more due to outside pressure (the Western world)?
"A quick recall of The Equitable Life, Barings Bank, Allied Irish Bank, Enron and Arthur Anderson indicates that the Western world does not have an unblemished record in terms of prudential financial management. All institutions must continually raise their standards. However, Islamic banks have particular difficulties in that they tend to be closely controlled by a few major shareholders. Such closely held institutions have to be extra careful with their risk management practices.", says Edwardes.
3. Do you believe Islamic banking in general is the subject of stereotypes and unjust treatment from Western governments (the issue of Hawala/terror funding)?
"There is a great deal of ignorance about Islamic Banking. Western regulators should follow the example set by the UK financial authorities - The Bank of England, the Financial Services Authority and The Treasury - who have made great strides in their understanding of the market and are very supportive. Of course all agree that the financing of terrorist activity must be stamped out. But in the Middle East and Asia many wonder why this does not include the arrest of donors over the past decades to IRA funds in New York." says Edwardes.
Michael Bilde, Journalist, DAGEN firstname.lastname@example.org
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