Performance of UK based Islamic banks

Malar Velaigam wrote on 25 March in Investors Chronicle about the progess of Islamic banking in UK from an investor's perspective. Only two Islamic finance companies have UK quotations, and neither of them has proved a very attractive investment so far.
The first Western Shariah-compliant commercial bank, the Islamic Bank of Britain (IBB). The bank floated in October 2004 at 25p a share, but now trades at half that price having hit a high of 13.7p and a low of 4.75p in the last year. It reported losses in 2005 till 2007. However, deposit basis and account numbers are growing substantially, while IBB customer base only represents 2.3 % of the 1.8 mn Muslim target market in UK yet.
Britain's second Islamic bank, the European Islamic Investment Bank (EIIB), received approvals to operate investment banking activities in March 2006. The bank floated on Aim last May, raising a disappointing £75m - it was looking to raise at least £100m - with shares priced at 25p each. The shares now trade at 7p. Over the last 12 months, they have reached a high of 10.25p and a low of 5.1p. Key staff is announced to resign and a European Real Estate Fund was not successfully placed and put on the balance sheet.
The Bank of London and the Middle East (BLME), does much better, but is owned by Boubyan Bank and no shares are listed.
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