Syariah Banking Protected from Global Financial Crisis

In May I attended the Malaysian Corporate Governance Conference, at the Securities Commission, Kuala Lumpur. In his opening speech, the Managing Director of the Securities Commission pointed out that Malaysia has the fourth largest bond market in the region and the largest Islamic capital market in the world, with Islamic banking. Afterwards I picked up some of the free booklets about Islamic Capital Markets in the commission's bookshop and noted the similarities between Syariah compliant securities and ethical investments, such as Australian Ethical Investments. Interestingly at least one commentator has claimed that "Islamic Banks Unaffected by Global Financial Crisis" (Mohammed Al-Hamzani, Asharq Al-Awsat, 30/09/2008):

A number of experts and officials of Islamic banks and financial institutions have confirmed that Islamic banks have not been affected by the global financial crisis, and that any effects would be limited due to the nature of Islamic banking.

Experts told Asharq Al-Awsat that Islamic banks are untouched by the current crisis due to the nature of Islamic banking especially that it does not deal in debt trading and distances itself from market speculation that takes place in European and American banks. ...