This is part of the way the loans are “restructured, where interest IS collected, just hidden another way. This is why the true essense of shariah is not fully being disclosed, and due diligence is not being done. -Comments by Allyson Rowen Taylor
By Liau Y-Sing
KUALA LUMPUR, Aug 26 (Reuters) – Malaysian mortgage firm Cagamas Bhd may help set up secondary Islamic mortgage companies in the Middle East and securitise loans from Gulf banks to tap rising demand for Islamic products in the region, its chief executive said on Tuesday.
Islamic banking players in mostly Muslim Malaysia are seeking overseas markets as a growing number of institutions compete for a modest market of 27 million people at home.
Malaysian firms are especially eager to court an estimated $300 billion of petrodollars from the Middle East, but some Gulf investors have shunned Malaysian Islamic products, saying they do not fully meet sharia, or Islamic law, standards.
The $1 trillion Islamic banking industry has built a sizeable following worldwide on its premise of social and ethical investments that avoid interest-based banking, conventional insurance and sectors such as gaming, weapons and pornography.
Cagamas chief Steven Choy said the firm is exploring ways to create Islamic products that are acceptable to Middle East investors, including purchasing loans from Gulf banks and…………………
continure reading at…………..http://www.guardian.co.uk/business/feedarticle/7752829