While lenders in the United States and Europe have downsized their exposure in banking in compliance with Islamic law, Islamic financial institutions in Southeast Asia and the Middle East and Africa (MEA) region are taking over the initiative.

According to global consultancy Ernst and Young, worldwide investments done in line with Islamic law, known as Shari'ah, will reach 1.8 trillion U.S. dollars globally in 2013.

Muslim investors in Texas have filed to charter a new Houston-based credit union that would market to the Shia Muslim populations in Houston, Dallas and Austin.

Unlike most of its counterparts, the Jafari No-Interest Credit Union would not charge interest on loans or pay interest to its members on deposit accounts, but rather it would charge various fees, as charging interest goes against certain principals of the Shia Muslim faith.

While the US relationship with the Islamic world has suffered from the recent inflammatory anti-Islamic film, values-based finance has emerged as an unlikely, yet significant point of connection. Its potential lies at the intersection of Socially Responsible Investing (SRI) in the West and Islamic Finance in the East. Both are on the rise.

Shariah Capital, an Islamic asset management firm based in the United States, is to delist from London's Alternative Investment Market (Aim) after a seven-year string of losses.

The hedge fund manager, which operates in the Middle East and has reported annual losses every year since 2005, said in a market message it would seek a cancellation of the shares.

JP Morgan Asset Management is closing its first fund investing in line with the tenets of Catholicism, after it failed to obtain the blessing of enough investors.

The fund manager is liquidating the Global Catholic Ethical Balanced Fund it launched just over a year ago, according to a notice in the Financial Times this week.

Khadijah Sahak, 59, sits in the family room of her neatly-kept townhouse in Sterling, Virginia. The Afghan news program broadcasting from her wall-mounted flat-screen television is discussing the Taliban. 

This leafy Washington suburb is a long way from the refugee camp in Pakistan where Khadijah’s family says they lived after leaving Kabul in 2002. 

On a recent sunny day, Eric Swats, a fund manager at Rasmala Investments, sat under a parasol at a restaurant on the terrace of the Dubai International Finance Center, talking up his new $25 million Rasmala Global Sukuk Fund.

Mr. Swats hopes it will tap into fast-growing demand from Middle Eastern and Asian investors for sukuk, securities that comply with Islamic law. “The market for conservative and well-managed” Islamic finance products is “underserved and underdeveloped,” he said over a lunch of salad and fruit juice.