News Column

Sarajevo: New European Islamic Finance Hub

May 31, 2014



SARAYBOSNA (CIHAN)- Admir Meškovic *



It's been more than 12 years since the first bank which operates under islamic banking principles was established in Bosnia and Herzegovina. At that time, only a few people in Bosnia knew about the Islamic finance, and in one case part of academic community even refused to accept that something like islamic banking actually exists.



Fikret Hadžic, PhD, is a professor at Sarajevo School of Economics and Business (SEBS) and Head of Centre for Islamic Economics, Banking and Finance (CIEBF), which is an organizational part of this Faculty. While discussing about the approval of his doctoral thesis in the field of Islamic banking, some academics on the Senate of University of Sarajevo actually had an opinion that there is no such thing like Islamic banking: „If there is Islamic banking, what about Jewish or Christian banking then?" – were the comments of some of the Senate members. Today, the things are different. Sarajevo becomes a hub from where the thought, science and practice of Islamic banking spreads to other parts of Europe.



NEW GENERATION OF MA STUDENTS



In June 2014, Sarajevo School of Economics and Business and University of Bolton will publish a call for the enrollment of a new generation of master students in the field of Islamic banking. That is the fourth generation of master students at SEBS, and the second generation of the international MA study with a joint degree with University of Bolton. This master study programme is a project of the Centre for Islamic Economics, Banking and Finance from Sarajevo and Centre for Islamic Finance from Bolton, so professors from both universities are engaged in this programme, as well as guest lecturers from academic and professional community. Students will acquire Bosnian and United Kingdom MA diploma, while all lectures are being held in Sarajevo. Studies are adjusted to people who work, and are carried out entirely in English language. Third partner in this project is a BBI bank with its BBI academy.



„We expect in future that Islamic Banking MA programme will mostly attract the students from the region of Balkan countries and Turkey which has a significant growth of Islamic finance industry. But, we already identified a huge interest from GULF countries and Asia. The candidates recognised the potentials of this study for building of their international carriers", says Velid Efendic, PhD, Head of the Islamic Banking MA programme.



Advantages of this study are emphasized by Omar Yunus, a student from Chicago, US, who came to Sarajevo to study Islamic banking. "The University of Sarajevo offers many things you would expect from an Islamic finance program - top scholars, academic support for your thesis... What makes it so much better and different, however, is the opportunity to work in an Islamic bank. You get a first-hand view of how classroom lessons take shape in the real world. At the same time, you can develop professional experiences and contacts that can be very helpful after graduation" - says Omar, praising hospitality of people in Sarajevo: "The people of Sarajevo are some of the most generous I've had the pleasure of meeting. My first few weeks in Sarajevo were spent at Izvor Nade, a dormitory filled with talented and respectful young men. Without any prior relationship, the group housed me and fed me while I found my bearings in the city. I couldn't be more thankful" – says Omar, noting that he experienced this spirit of generosity and hospitality in many other relationships. Omar also volunteered after huge floods in Bosnia: "Very sad stuff, man…" – said Omar shortly.



More than one hundred of young people from all around the world also recognized this opportunity, and they applied for CIEBF scholarship which enables funding of 50% of the tuition fee for this master degree. This year, Centre for Islamic Economics, Banking and Finance has also provided two 50% scholarships for students from selected countries. Until now, the largest number of applications they received from Pakistan. Pakistan is a country which has highly developed Islamic finance industry, but have UK diploma is also very attractive to students from this country.



FASTEST GROWING INDUSTRY



Pakistan is certainly one of the pioneers when it comes to the Islamic finance industry, but this field of finance is actually a fastest-growing one at the global level. In fact, the need for qualified staff is so great that universities from around the world can't „produce" enough experts in this field to meet the needs of the Islamic finance industry. According to World Islamic Banking Competitiveness Report 2013-2014, Islamic banking industry growth in 2012 was 17,6 percent. Some other fields of Islamic finance, like Islamic insurance (takaful) or sukuk (Islamic bonds) are growing even faster.



SUPPORT BY BBI BANK



Islamic banking industry is also rapidly growing in Bosnia and Herzegovina. From March 2013 to March 2014, total assets of BBI bank increased by 34,4 percent. Deposits grew up by 27,4 percent, while total financing increased by 23 percent.



BBI bank, as the only bank of this kind in the whole region of Former Yugoslavia, provides strong support for education in the field of Islamic banking for years. In 2013 they approved new 20 scholarships for Islamic banking students in Sarajevo. Students are very thankful, but some of them also already got a job in this bank.



"Working at BBI Bank has been invaluable. Its supportive environment helped me join one of the bank's largest projects during my second week. The learning experiences and professional development that followed have surpassed even my most optimistic expectations." - said Omar Yunus.



Mandatory part of the Islamic banking master study is an internship in BBI bank, which enables students to acquire practical knowledge in an Islamic bank. BBI Academy also holds seminars in the field of Islamic banking for students. This is very appreciated by students, and the next step will probably be to link CIEBF with the largest Islamic banks in the world in order to facilitate students seeking a job after completing their master study.



„I came to BBI to do a regular internship for the master study. After four days of this internship, they transferred me to the Department of Accounting and now I work there" – says Nermin, student of Islamic banking master study.



ESTABLISHING CIEBF PROVIDED MANY OPPORTUNITIES



Islamic banking has been thought and researched on Sarajevo School of Economics and Business more than 10 years, and the establishment of Centre for Islamic Economics, Banking and Finance is a crown to the hard work on various projects in this area at SEBS. Now, CIEBF is already recognized as a respectable partner on the global level, and University of Sarajevo is one of the fastest growing universities in the world in terms of Islamic banking education. Researchers now apply for research visit at CIEBF, and there are also volunteers from all around the world who are willing to come and complete internships or volunteer at CIEBF. Centre has also received proposal for partnership in organizing distance learning studies in the field of Islamic finance from one renowned Islamic finance educational institution from Pakistan. Besides Islamic banking studies on the undergraduate and master level, Sarajevo School of Economics and Business is working hard for the development of PhD studies in Islamic banking, and first generation of PhD students is planned for academic year 2015/2016, although there is already high demand for PhD by international candidates.





EUROPEAN ASSOCIATION WAS ESTABLISHED



One of the proposals and conclusions of the conference „Business in between Cultures – the Development of Islamic Finance", which took place in Sarajevo in November 2012, was that there is a strong need for the establishment of European association for Islamic Finance, and Sarajevo is proposed to be the residence of such association. "Novo vrijeme" already wrote about this in 2012. In April 2013 this association was finally founded, formally known as the „European Association for Islamic Economics, Banking and Finance". Association has various activities, like supporting the education in the field of Islamic economics, research, promotion of Islamic finance, organizing conferences, etc.



One of the first projects of EAIEBF association is a new Islamic Finance conference titled NEW CHALLENGES FOR ISLAMIC ECONOMICS AND FINANCE DEVELOPMENT. The conference will take place in Sarajevo, in the hall of Gazi Husrev-bey's library, on November 20-21, 2014. Conference will cover various topics in the field of Islamic Finance and will make Sarajevo, with God's help, a meeting place of experts in this field from all around the world - once again.



* Admir Meškovic, MSc

Centre for Islamic Economics, Banking and Finance, Sarajevo

CIHAN


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Source: Cihan News Agency (Turkey)


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