The UK is the leading Western centre for Islamic finance, with Sharia compliant assets within the UK totalling around $6bn (£4.7bn) in 2017, according to a new report by TheCityUK, supported by international law firm Trowers & Hamlins.
There are more than 15 institutions located in the UK offering Islamic finance services, which is estimated to be nearly double the number located in the US, and far ahead of other Western countries. With five licensed sharia compliant banks and 72 listed Sukuk registered on the London Stock Exchange, the UK offers one of the most attractive regulatory and tax systems for Islamic finance anywhere in the world. The report, ‘Global Trends in Islamic finance and the UK market’, also shows that globally Islamic banking assets totalled $1.7trn at the end of 2017, up 2.7% year on year. As the leading centre of Islamic finance education and training, the UK is strongly positioned to meet the growing global demand for skills in Islamic finance. Given its role as the global leader for FinTech, the UK is also in pole position to capitalise on the burgeoning Islamic finance FinTech market. There were around 120 Islamic FinTech firms globally at the end of 2017, with the UK ranking second with 18 of those.
Neill Gibson, partner at Trowers & Hamlins, said, “As the key jurisdiction for Islamic finance in Europe, London has proven its ability to adapt and innovate to embrace new markets. It’s very promising to see Islamic finance gaining a stronger foothold in the UK, and we have sought to encourage this with our presence in the Middle East and Malaysia.” Mr Gibson added, “We look forward to working with regulators as we develop our expertise within Sharia-compliant markets and products. We are very pleased to support this report by TheCityUK which demonstrates the important role London plays as a Western gateway to Islamic finance.” Miles Celic, chief executive officer, TheCityUK, said, “Islamic finance is a specialist area that offers strong growth potential for the UK. The sector’s increasing importance for investors globally is demonstrated by its steady growth in recent years and global demographic trends suggest its potential for future growth remains robust.”