‘Untapped’ Endowments May Boost Shariah Funds: Islamic Finance

Managers of Islamic endowments with $105 billion in assets are seeking to diversify out of bank deposits, providing Shariah-compliant funds with the chance to capture new business, Ernst & Young LLP says.

These “largely untapped” endowments, or awqaf, have as much as $40 billion of cash parked at commercial banks, Ashar Nazim, Manama-based executive director and head of Islamic financial services for Ernst & Young, Bahrain, said in a telephone interview Nov. 9. Awaqf typically consists of cash or assets, including land and buildings, donated by individuals or institutions for charitable and religious purposes.