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Regulators approve first Muslim bank

09 August 2004
Britain's first Muslim bank is due to open after regulators approved its establishment.

The Islamic Bank of Britain has been given the go-ahead by the Financial Services Authority. The bank, which will start operating from September, will be operating under Sharia - or Muslim - law which forbids the paying or charging of interest.

The new bank will have its headquarters in Birmingham and it will open its first branch in Edgware Road, London, in September, followed by further branches in Birmingham and Leicester within a month.

It will buy items and lease them back to customers while they pay for them and hopes by November to operate nationally through telephone and postal banking.

A group of Islamic scholars will sit on a supervisory committee which must approve the bank's services, investments and activities, and The Islamic Bank of Britain has also promised not to invest in companies associated with tobacco, alcohol or pornography.

Certain British banks, including HSBC, already offer Sharia-compliant products, but they are all non-Muslim companies.

Michael Hanlon, managing director of the Islamic Bank of Britain, said: "We are confident that we can provide customers with a range of Sharia-compliant products and services, equivalent to those available in a conventional bank and competitively priced."
DeHavilland Information Services plc