Islamic banking set for boom

Islamic finance and banking has been tipped to be the single fastest growing media sector next year, according to agency bosses.

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By  Tim Addington Published  December 11, 2005

Islamic finance and banking has been tipped to be the single fastest growing media sector next year, according to agency bosses. The industry has developed significantly since the September 11 attacks and the move by rich Middle East investors to repatriate their money. While ad spend on real estate remains at an all time high, media, creative and PR heads are predicting that 2006 will be the year spending on Islamic finance goes up a gear. Their comments come as the more than 500 delegates from 31 countries attend the World Islamic Banking Conference in Bahrain, which is looking at unlocking market opportunities, consolidation, innovation and growth and coincides with Saudi Arabia joining the World Trade Organisation. Khalil Minawi, managing director at Impact BBDO in Jeddah, said: “The Islamic banking sector and insurance is going to be interesting. I’m optimistic for the next five to seven years there will be a lot of action happening.” And he claimed that increased investment from outside of the region will generate further growth in the sector. There is speculation that non-Saudi companies will soon be allowed to own 100% of a company, which will lead established firms to look to advertising to maintain their share of the market. He said: “I think there will be a lot of sectors that will have to look at their capabilities to get ready for the big fight with international business.” John Hobday, managing director at financial PR firm Citigate, said that while the growth of Islamic finance was more than a trend, marketers were not doing enough to communicate what it is about. He said: “Marketing of Islamic finance is still very immature, nobody is defining the products. The marketing of Islamic services is generic, there is little differentiation. “For Islamic finance to have long-term potential, it has to stand up in its own right, rather than being complacent. The marketing community can certainly be more challenging to its clients to be more articulate on Islamic finance and what it means.” David Sheridan, regional director at MindShare, which plans the media for HSBC’s Islamic banking division Amanah, said: “2005 has seen significant growth in Islamic finance and this will continue through 2006 and beyond. It is a very exciting area.”

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