By Douwe Miedema, European Wealth Management Correspondent
GENEVA (Reuters) - Muslim millionaires are slowly warming to Islamic investing, a senior HSBC (HSBA.L: Quote, Profile, Research, Stock Buzz) banker said, taking their cue from retail clients already keen on sharia-compliant banking.
A wider appeal for the rapidly growing number of Middle East millionaires would bode well for the nascent Islamic finance industry, where some 300 banks vie for the favours of Muslim investors, up from almost none 30 years ago.
"It started with retail banks, but now it is also invading the private banking business," said Pierre Pissaloux, who heads the Middle East unit of HSBC Private Bank (Suisse).
Boosted by petrodollars, the number of people in the Middle East with at least $1 million to invest grew by 12 percent in 2006, and the total cash they held stood at $1.4 trillion.
Growth rates are forecast to stay close to 10 percent in the period up to 2011, according to a study.
The spread of Islamic finance products into the upper reaches of private banking had in the past been modest, but a product range including hedge funds was now suited even for demanding multi-millionaire clients, Pissaloux said.
"I have some strong goals to fill our product offering with suitable (Islamic) products. We can now do our work as asset managers with a suitable Islamic product offer," Geneva-based Pissaloux told Reuters in an interview.
Some 8 to 10 percent of clients put their money into Islamic finance in his unit, Pissaloux said, well below a number of up to 20 percent often mentioned by other banks who offer Islamic finance to an audience of less wealthy clients. Continued...
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