Mandelbrot set image very small
Serious writing for
serious readers
Follow @Mohammed_Amin
Join my
email list

Search this site

Custom Search
Mohammed Amin's website
Serious writing
for serious readers
Tap here for MENU

An update on Bank of London and the Middle East plc

After passable years in 2018 and 2019, the bank has reverted to poor results, probably worsened by the coronavirus pandemic.

Posted 4 January 2023

I regularly look at the results of the UK's Islamic banks. They are readily available and offer good insights into the state of the Islamic finance market in the UK.

For my October 2022 column in the magazine "Islamic Finance News" I had another look at the UK's largest Islamic investment bank, Bank of London and the Middle East plc. I found that it had reverted to reporting poor results.

While the coronavirus pandemic will not have helped, over its history the bank has failed to be consistently profitable.

Another look at the UK’s largest Islamic investment bank

From shortly after it opened for business, Bank of London and the Middle East plc (“BLME”) has been the largest standalone Islamic investment bank in the UK.

In my 9 January 2019 column, “Making money in UK Islamic banking is tough”, I listed year by year the results for BLME’s first 11 years.  There were seven years when it made small profits, interspersed by four years of large losses, resulting in a cumulative loss by 31 December 2017 of GBP 31.6 million.

I mentioned its 2020 results in my 2 June 2021 column “How is the UK Islamic banking scene?” which was a first look at the UK Islamic banking sector after the COVID-19 pandemic. I reported that BLME made profits of GBP 900,000 in 2020, commenting that “The return on equity of 0.4% should not please anyone at the bank.”

Today, instead of just looking at 2021, I am updating my cumulative table of BLME’s results:

Calendar year

Profit / (loss) after tax GBP million

Shareholders’ funds GBP million

Return on equity %

Cumulative to 31.12.2017




















The profits made in 2018 and 2019 were the largest in BLME’s history, since the highest profit in the first 11 years of operation was GBP 4.3 million in the year ended 31 December 2013.

The much reduced profit in 2020 was understandable given the COVID-19 pandemic, and I would commend BLME in avoiding a loss that year. Sadly in 2021 BLME seems to have reverted to its previous history by reporting a significant loss.

Comparing the 2021 Income Statement with that for 2020 indicates that the main reasons for the worsening result in 2021 are an increase in credit impairment losses, and a significant increase in “Other operating expenses”, especially legal and professional fees. It was credit impairment losses that primarily led to the poor results in the first 11 years.

Since 2013, BLME has been a wholly owned subsidiary of BLME Holdings plc which was listed on NASDAQ Dubai. A controlling interest in BLME Holdings was acquired by its largest shareholder, Boubyan Bank KSC of Kuwait in 2020, after which the company delisted and is now called BLME Holdings Ltd.

Since BLME is by far the largest subsidiary of BLME Holdings Ltd, it is no surprise that BLME Holdings Ltd also reported a loss in 2021, of GBP 8.6 million (after excluding results attributable to minority interests in subsidiaries.)

Something that seems to go unremarked is that all four of the UK’s Islamic banks are now owned by foreign parents, with Al Rayan Bank and QIB (UK) both being owned from Qatar, and BLME and Gatehouse owned from Kuwait.

It is striking that none of the other countries which aspire to lead Islamic finance consider it worthwhile establishing in the UK. This indicates that they may share my view that the UK is a very challenging place in which to establish new Islamic banks, particularly given the incumbency factor which will now favour those already established here.

Mohammed Amin is an Islamic finance consultant and former tax partner at PwC in the UK.


The Disqus comments facility below allows you to comment on this page. Please respect others when commenting.
You can login using any of your Twitter, Facebook, Google+ or Disqus identities.
Even if you are not registered on any of these, you can still post a comment.

comments powered by Disqus


Follow @Mohammed_Amin

Tap for top of page