1. Sharia’, Finance and Strategy
Abdel-Maoula Chaar

2. Strategic Management for IFIs
Porter five forces
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

3. Strategic Management for IFIs
Porter five forces
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

4. Strategic Management for IFIs
Rivalry Among firms
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

5. Strategic Management for IFIs
Porter five forces
Rivalry among firms
AM Chaar– Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

6. The distribution of IFIs
Islamic finance facts
The distribution of IFIs
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

7. Islamic markets characteristics
Islamic finance facts
Islamic markets characteristics
951 billions Sharia compliant assets
799 billions banking assets
152 billions under management
1 trillion target expected in 2010
20-30% annual growth rate
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

8. The distribution of Islamic assets
Islamic finance facts
The distribution of Islamic assets
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

9. Islamic markets characteristics
Islamic finance facts
Islamic markets characteristics
951 billions Sharia compliant assets
799 billions banking assets
152 billions under management
1 trillion target expected in 2010
20-30% annual growth rate
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

10. Islamic markets characteristics
Islamic finance facts
Islamic markets characteristics
951 billions Sharia compliant assets
799 billions banking assets
152 billions under management
1 trillion target expected in 2010
20-30% annual growth rate
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

11. Growth of Islamic banking assets
Islamic finance facts
Growth of Islamic banking assets
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

12. Strategic Management for IFIs
Porter five forces
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

13. Islamic markets characteristics
Islamic finance facts
Islamic markets characteristics
HNWI and UHNWI on the rise
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

14. Islamic finance facts Islamic markets characteristics
HNWI expected annual growth ( )
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

15. Islamic markets characteristics
Islamic finance facts
Islamic markets characteristics
HNWI and UHNWI on the rise
Affluent Segment:
Young, active, optimistic
Financial markets and financial services underdeveloped
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

16. Conventional banks’ Islamic vehicles
Islamic finance facts
Conventional banks’ Islamic vehicles
2003 4
2004 5
1998 2
2002 3
1996 1 1 9 5 2
1. Citi-Islamic -
2. HSBC Amanah -
3. Noriba (UBS)
4. BNP Paribas Najmah -
5. Calyon Islamic Window
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

17. Conventional banks’ Islamic vehicles
Islamic finance facts
Conventional banks’ Islamic vehicles
Window Models
Used by banks to carry out altogether Islamic and conventional financial operations
Branches
Dedicated delivery channels for Islamic finance products
Subsidiaries
Separate legal entities used to offer Islamic finance products

18. Strategic Management for IFIs
The dynamic of Islamic and western financial fields
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

19. Strategic Management for IFIs
The dynamic of Islamic and western financial fields
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

20. Strategic Management for IFIs
Porter five forces
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

21. Strategic Management for IFIs Difference in Islamic sensitivity
Only Islamic – 20%
Sacrifice returns/service for full Sharia’ compliance
Looks for pure Islamic players
Islamic if equal performance – 40%
Will not sacrifice returns/service for Sharia’ compliance
Sharia’ compliance is a bonus
Value-Seekers – 30%
Looks for the best performance regardless the bank identity
Only conventional – 10%
Ernst & Young (2008). The Islamic funds and investments report.

22. Strategic Management for IFIs
The dynamic of Islamic and western financial fields
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

23. The Islamic Finance Paradigm The specificities of the Sharia’
Quran
Sunna S o u r c e s
TAWHID
(Quran / Sunna)
STEWARDSHIP
(Sharia)
Sharia
Fiqh al
Mouamalat
Ijtihad I n t e r p a i o
MASLAHA
(Fiqh et Ijtihad)
Operations
(Techniques)
Organization
(Sharia Boards)
Mindset
Applications

24. The Islamic Finance Paradigm
The Paradigm

25. The Islamic Finance Paradigm The specificities of the Sharia’
Letter of the Sharia’
Spirit of the Sharia’

26. The Islamic Finance Paradigm The specificities of the Sharia’

27. Strategic Management for IFIs
The dynamic of Islamic and western financial fields
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

28. Strategic Management for IFIs
Porter five forces
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

29. Strategic Management for IFIs
The dynamic of Islamic and western financial fields
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

30. Strategic Management for IFIs
Porter five forces
AM Chaar – Introduction – 5th Islamic banks and financial institutions conference – Damascus 2010.

31. Strategic Management for IFIs Education in Islamic Finance

32. Strategic Management for IFIs Education in Islamic Finance

33. Thank you
Abdel-Maoula Chaar