Oil and the internationalization of Arab banks

The author's section on Islamic banks states that Islamic banking is seen by Muslims as a framework of dealings that is acceptable, in contrast to the capitalism of the conventional system. Islamic banks, he relates, ground themselves in the Shari'ah. There is risk sharing and justice in distribution. A brief history of the establishment of Islamic banks is given. The principles of Mudarabah and Musharakah are touched on. The relatively low volume of assets in Islamic banks is shown. Islamic banking institutions are seen as appropriate bodies for mobilizing the wealth of the general population of the Muslim world. The returns offered by Islamic banks in 1980-1982 do not compare favorably in size with the returns paid out by Saudi conventional banks in the same period. The author relates that difficult times and tribulations in the Middle East have not left Islamic banks unshaken.