Greater cooperation, rather than competition, between the Middle East's Islamic financial institutions is necessary if Islamic finance is to provide a real alternative to the conventional, international banks operating in the region, according to Hussain AlQemzi, CEO of Noor Investment Group and CEO of Noor Islamic Bank. Speaking Wednesday at the Middle East Islamic Finance and Investment Conference, in Dubai, AlQemzi, a seasoned banker with over 26 years of extensive experience working with leading financial institutions in the UAE, said regional Islamic banks do not have the financial punch to challenge their larger competitors from the US, Europe and the Far East. "If we are to challenge the conventional banks' entrenched position in international financial deals, we must develop the capacity to structure multi-currency and cross border transactions and to build scale," AlQemzi said. "To do that, we need to build deeper relationships between the key markets and between individual banks. Only then, will we be better placed to compete on a global scale. "I have been asked many times what is it that international banks do well? The answer is simple. They leverage the relationships they have with banks they know well. Why can't Islamic banks do this?" "At Noor, it is a model we have employed successfully in Turkey, where we have worked closely with other banks to lead manage and arrange over US $ 2 billion of capital finance market deals. More than 55 institutions from 15 countries, across Europe, Asia, Africa and the Middle East, have participated. If it can be done in Turkey, it can be done anywhere," AlQemzi added. Addressing delegates to MEIFIC 2012, AlQemzi urged the Islamic finance industry to work together to overcome differences in interpretation of Shariah compliance and to develop new and innovative products and services, which would allow Islamic banks to offer a true alternative to conventional banking. "As we acknowledge our differences in the interpretation of Shariah principles, we must also acknowledge that these differences cannot be used as an excuse for our industry not to engage in open and free business," he said. "The time has come for us to stop focusing on our differences as reasons for not doing business. It is time to talk about how Islamic finance can contribute to long-term inclusive, equitable and sustainable economic growth not just here, in the Middle East, but in every country across the globe." He noted the pace of development of the Islamic finance sector has been too slow and that unless industry practitioners are more willing to challenge the regulators, whether central banks, legal structures or Shariah scholars, the internationalization of Islamic finance would continue to underperform and not reach its full potential. "I am not saying that it is the regulators that have held us back. The brake on our development has been applied by ourselves," said AlQemzi. "But unless we, the practitioners, are more willing to challenge the regulators we will not create the new, innovative products, based on the core principles and values of Islam, that will entice customers away from conventional banks. "It is our joint responsibility to sit together to develop these products and structures. It is our duty to leverage our collective expertise in order to push regional boundaries of understanding closer towards each other. It is only when we commit to crossing these boundaries will the regulators be able to do what should essentially be their primary role, to protect customers, to reduce risk and to minimize disruption. All other aspects of the industry are our responsibility," he added.
