"We are close to getting a licence for a Sharia compliant investment banking subsidiary that will be up and running soon," said Mr Nathif Adam, the Chief Executive.
"Expanding fast is a strategy that we hope not to go wrong with because we are doing our mathematics well," said Adam.
The Other Islamic Bank, Gulf African Bank has also opened several branches in various towns among them an able team in the Garissa branch headed by my freind Ali Noor Shabure, formerly of KCB, now the branch manager. Shabure has previously been working for KCB and his last posting was in Moyale. He is required to harness his past relationships and knowledge of the business community to add value to our services in Garissa for the Islamic Bank. The Garissa branch is the 7th to be opened since Gulf African Bank started operations in January this year. The target is to have 11 operational branches by end 2008 and we are on course.
Globally, HSBC and UBS have created separate brands for Muslims while Maybank in Malaysia and Samba Financial in Saudi Arabia have opened special branches that sell only Islamic banking products.
"Our plan was to have as many branches as possible in all the Muslim-dominated regions of Kenya, including North Eastern Province and as many branches as possible in Coast Province," says Mr Adam, adding that the new bank has also opened a branch in Garissa last February. The move is seen as a major step in opening up the regions to the financial sector which comprise a substantial proportion of the unbanked rural population across the country. The initial roll out targets a branch in Eastleigh -Kenya's "Little Mogadishu" - another in Mombasa and a third at Prudential House within Nairobi's Central Business District. The bank has already hired 55 members of staff across all ranks.
Prior to his appointment, Mr Adam, 58, was the Senior Vice-President and Head of Investments at Sharjah Islamic Bank in the United Arab Emirates (UAE). A career Islamic banker, he insists that he was the pioneer of Islamic banking in Kenya.
"It is not true that Islamic Banking came into vogue in 2005 . I had already indicated my desire to start an Islamic bank to the CBK way back in 1984," he said. Apart from FCB, the Gulf African Bank is the other bank in Kenya with a licence to operate as a fully Islamic bank.
Mr Adam, however, says there are challenges to be overcome if the new bank is to make an impact in the country. Chief among them is association of Islamic banking with terrorism.
"We have to be realistic. Getting rid of the notion that Islamic banks are conduits for financing terrorism will be one of my biggest challenges," he says. The other is to open up the bank to all Kenyans.
"As a matter of priority FCB will offer shares to the public through an IPO at the Nairobi Stock Exchange," Mr Adam said. Under Kenyan laws, a company has to be in existence for at least five years before it can be listed unless if it is floated at another stock exchange.
The emergence of shari'a complaint bank products was made possible through amendments made to section 53 of the Banking Act last year, removing prohibitions on trading in and holding of fixed assets.