London's first Islamic investment bank opens

The European Islamic Investment Bank opened for business in London today, a month after receiving clearance from the UK Financial Services Authority (FSA).

The bank's managing director, John Weguelin, said: "We believe our purely sharia-compliant approach, together with our independence and status as a UK regulated business, will enable us to become a leader in the Islamic financial market."

EIIB is owned by various investors and companies in the Middle East and elsewhere. It has refused to reveal ownership details, although Weguelin said no single shareholder has a majority stake.

The bank plans a £200 million share offering in June as part of its move onto the London Alternative Investment Market. It will operate as a full-service investment bank, covering treasury and capital markets, asset management, trade finance and corporate finance. A branch in Bahrain is scheduled to open later this year.

Operating under sharia law, the bank will avoid interest-bearing investments. It will also avoid investments involving gambling and speculation.