LONDON, 24 July 2006 - Iqbal Khan, chief executive of HSBC Amanah, the Islamic finance division of the HSBC Group, resigned on Thursday in a move which has taken the Islamic banking sector by surprise. The resignation which took immediate effect raises questions about the future of Islamic banking at the HSBC Group, the self-styled "world's local bank".
A statement from HSBC simply stressed that Khan "will be leaving the group at the end of 2006 to establish a dedicated Islamic financial services firm." HSBC has appointed one of Iqbal Khan's protŽgŽs, Razi Fakih, as acting chief executive of HSBC Amanah with immediate effect.
Fakih is one of the founding members of HSBC Amanah, which was set up in July 1998, and is currently managing director and head of its Global Onshore Banking unit.
Michael Geoghegan, the HSBC Group's chief executive, was quick to re-assure customers of HSBC's continued commitment to Islamic banking. "In HSBC Amanah we have created one of the leading international brands in Islamic financial services. This is an innovative business and one that reflects the diverse geography, culture and talents of the HSBC Group. We remain absolutely committed to building this business and have a great team in place to continue the growth we have achieved in the last nine years. I would like to pay tribute to the tremendous leadership Iqbal has provided to HSBC Amanah and I am pleased that we will continue to benefit from his counsel as an adviser to our group."
Khan, one of the scions of the Islamic banking movement, steps down as the head of HSBC's global Islamic financial services division immediately, but he will continue to serve as an adviser to the group. To ensure a smooth transition, Khan has also agreed to remain on the boards of the Saudi British Bank
(SABB), HSBC Saudi Arabia and HSBC Bank Middle East till Dec. 31 2006.
HSBC has also given Khan the responsibility of establishing the HSBC Amanah Foundation, a non-profit CSR (corporate social responsibility) organization that aims to strengthen educational initiatives in Muslim communities. In fact, even after he leaves the HSBC Group at the end of 2006, he will remain a board member and trustee of the foundation, which he stresses, is "a concrete manifestation of HSBC's commitment to the greater ethos of Islamic financial services."
Khan yesterday confirmed that he has resigned from HSBC Amanah and stressed that he came "to this considered decision after much reflection."
He said, "I have been privileged to serve the Islamic financial service industry for some two decades now, and I am particularly excited by the growth and successes we have seen in the past several years. The years ahead are critical to the direction of the industry and, going forward, I have chosen to focus my personal efforts on a dedicated Islamic financial services firm.
"I came to HSBC to build a leading platform in the Islamic financial services industry, a goal which I believe has been successfully accomplished. We have arrived at a point where I want to focus my efforts on value-added work dedicated solely to the Islamic finance industry. I am reassured by the fact that I leave HSBC Amanah in great hands. Razi Fakih was one of the founding members of Amanah and is supported by a team of enormous talent and commitment."
Khan added that his resignation from the HSBC group is "on amicable terms" and that his new London-based firm will specialize in Islamic corporate finance advisory business and services and will have no equity or any other links with the HSBC Group.
Over the last nine years, HSBC Amanah has pioneered the provision of Shariah-compliant products and services to Muslim communities in several countries including the UK, Malaysia, UAE, Saudi Arabia, Bangladesh, Brunei, Singapore, Indonesia and the US. Today, HSBC Amanah has over 300,000 customers from offices across nine countries.
Khan stressed that he is confident that "HSBC Amanah remains committed to its clients and to its investment in this (Islamic banking and finance) industry. Knowing that I leave the business in good hands makes my departure easier. I have my colleagues in the HSBC Amanah team and the wider HSBC Group to thank for that. I have always stressed that this is not just a client-focused but also a client-driven business, and that the wisest course of action for HSBC Amanah is simply to follow to the needs and values of our clients."
