Center Co-hosts Islamic Finance Seminar March 13

One of the fastest growing areas of finance – Islamic banking – is the subject of a new course at DePaul University’s business school, which also will co-host an Islamic finance industry seminar on the university’s downtown Chicago campus March 13.

The course, which debuted in the fall quarter, puts DePaul’s Kellstadt Graduate School of Business in the forefront of American business schools offering opportunities to study Islamic banking. Only a few universities nationally have any programs focusing on this topic, despite the fact that Islamic banking has grown 10 to 15 percent each year during the last decade and is expanding rapidly into countries that are not majority Muslim. The industry currently encompasses 300 Islamic financial institutions in 51 countries, and more than 250 mutual funds adhere to Islamic principles, according to the International Monetary Fund.

“DePaul has always been a strong proponent of multicultural education, and this is especially important for finance students because the business world is so globally intertwined,” said Ali Fatemi, chair of DePaul’s finance department, which launched the new programs. “Knowledge of the growing Islamic banking and finance industry is essential for students who seek a well-rounded business education.”

In addition to educating students about this burgeoning industry, DePaul’s Center for Financial Services will foster discussion among area practitioners by co-sponsoring Islamic finance seminars. The center will co-host the first program March 13 from 8:30 a.m. to 1 p.m. at the DePaul Center, 1 E. Jackson Blvd. Another seminar is planned for the summer.

At the March 13 event, local and international Islamic finance firms with headquarters or major branches in Chicago – Merrill Lynch, Devon Bank, Unicorn Investment Bank, Sunrise Equity, Zeus Capital Advisors, Zayan Finance and CIG Corp. – will discuss the general landscape of the Islamic finance industry, as well as specific topics that include commercial real estate finance, private equity, philanthropy, retirement investing and other global investment and financing opportunities.

Karen Hunt-Ahmed, a DePaul finance professor with expertise is in Islamic finance, who will co-host the seminar and teaches DePaul’s new 10-week Islamic banking course. Fourteen students – both Muslim and non-Muslim – enrolled in the fall class.

Since there is no definitive textbook on Islamic banking, Hunt-Ahmed used a variety texts, case studies, guest speakers and experiential learning to teach students about banking processes and principles that are guided by Sharia, or Islamic law. The course covered the fundamental differences between Islamic and conventional banking systems, including the Islamic emphasis on socially equitable investing; prohibitions on charging interest and investing in alcohol- or pork-related industries; the need to segregate Sharia-compatible investments from non-Islamic investments and accounting rules that are unique to Islamic institutions. Executives who work for Chicago-based financial firms engaged in Islamic banking shared their experiences with the class as well.

Muslim culture and how it affects business relations was also discussed. Students learned about the observance of Ramadan in the fall at an Islamic center dinner, where Muslims broke their fast.

Hunt-Ahmed became interested in Islamic finance while working for a bank in Dubai and through her exposure to Muslim culture via her husband, who is of Pakistani descent. “It started when I looked at cash flows at the bank,” she said. “They looked similar to a Western bank, but when you delved into them, they were structured quite differently. I began studying it and became hooked,” she said. Ahmed focused her doctoral dissertation at the University of Chicago on the socially responsible investing aspects of Islamic finance and earned a Ph.D. in comparative human development. She also has an MBA and bachelor’s degree in psychology, from Washington University, St. Louis.

The emphasis in Islamic banking on socially equitable financing was what attracted MBA student Denise Foy to Hunt-Ahmed’s course this past fall. “In Islamic banking, the reasons for investing are not all about money—it’s also about helping people,” she observed. Foy hopes to intern at a financial institution that offers Islamic banking.

Editors’ Note: Reporters interested in covering the March 13 Islamic finance seminar should contact Robin Florzak, DePaul Media Relations: (312) 362-8592.