Islamic banking: Al Baraka expands in hard times
Credit-quality and profit-growth troubles; Subsidiary in Syria to undertake IPO
Al Baraka Banking Group already has a network across 12 markets in the Middle East, Africa and Asia, but this pioneer of Islamic mass-market banking is accelerating its expansion at a difficult time.
In October, for example, the bank’s new Syrian subsidiary hopes to raise $35 million on the Damascus stock market and bring its total capital to $100 million. Bemo Saudi Fransi is arranging the issue. By early next year, the Syrian network will start operations, almost completing Al Baraka’s jigsaw in the eastern Mediterranean.
Adnan Yousif at Al Baraka is bringing Islamic products to the unbanked Muslims
Adnan Yousif, chief executive of the Bahrain-based institution, tells Euromoney he expects to start negotiations by the end of 2009 on an acquisition in Indonesia, where there are a couple of banks he is considering as targets. He says the bank is also thinking of introducing retail banking operations in China, India and France – countries whose large Muslim populations have little or no access to Islamic banking services.
By 2012, the group, which focuses on retail as well as small and medium-sized businesses and trade finance, plans to have about 450 branches, compared with about 300 at the beginning of this year and about 150 five years ago.