Islamic finance

Islamic finance

Farmida Bi

Norton Rose Fulbright

University: University of Cambridge, Downing College
Degree: Law

The term ‘Islamic finance’ refers to a system of banking that is consistent with sharia law. In particular, interest is prohibited, as is investing in businesses considered unlawful, such as those which trade in pork or alcohol. Although Islamic finance was initially important predominantly to commercial firms with interests in the oil-rich countries of the Middle East, it is now a practice area in every major international firm. Banks, financial institutions, sovereigns and corporates worldwide still take a great interest in traditional Islamic finance markets such as Malaysia, the United Arab Emirates and Saudi Arabia, but there are also significant Islamic financial centres in London, Hong Kong and Singapore. This, combined with the growth of Islamic finance throughout Asia and Africa, is leading to an increased need for lawyers who understand Islamic finance.


Farmida Bi was initially drawn to the law by the prospect of “going out there and righting wrongs and helping people” – a lofty ideal, and not uncommon when the notion of becoming a lawyer is dreamed up in childhood. It took a law degree and a few stints of work experience to discover that in fact, she wanted to be an entirely different type of lawyer: “I did a vacation scheme at Clifford Chance in my second year. I loved the international nature of the work, and the informality when compared to the chambers at which I’d done mini-pupillages.” Another reason for turning down the Bar was financial: “At that time, you generally had to fund your way through Bar school and pupillage, whereas the big law firms paid for law school, a maintenance grant and your training. For me, the financial imperatives were decisive.”

Farmida studied her finals (now the LPC) at The College of Law (now The University of Law) in Guildford and went on to do her articles (now the training contract) at Clifford Chance. She recalls the time fondly: “We had about 80 people in our intake, so there were lots of us in the same position. It was a well-organised programme and you got a real sense of the different options available to you. I also spent six months in Singapore, which I loved.”

Leader in the field

Leaving Clifford Chance when she was four years’ qualified, and after a brief spell in-house at JP Morgan, Farmida moved to US firm Cleary Gottlieb and qualified at the New York Bar. That was, she enthuses, “a wonderful experience; I had a much broader range of work than before, with a huge amount of responsibility – it was exhilarating”. She then became a partner at Denton Wilde Sapte (now Dentons), which is where, as part of the capital markets team, she first encountered Islamic finance; in 2008 she joined Norton Rose (now Norton Rose Fulbright) as a partner, where she is European Head of Islamic Finance. She is the only woman ranked for Islamic finance in Chambers UK and has also added to her trophy cabinet by scooping ‘Best in Banking and Finance’ at the European Women in Business Law Awards in 2011 and 2013.

Farmida’s practice is primarily focused on capital markets and she explains where Islamic finance fits into that: “Islamic finance can be used for all sorts of deals – be that financing an aeroplane, constructing a building or going out into the markets and raising money – while fulfilling the requirements of sharia law, which includes a prohibition on the charging of  interest.” 

“Our job is to structure a transaction which satisfies the client’s commercial needs and meets the requirements of the sharia, as evidenced by a fatwa provided by an Islamic scholar”

Change is afoot

She describes the changing nature of Islamic finance: “For us as a firm, and for me personally, Islamic finance has become quite specialised. Three or four years ago, if you were an Islamic finance lawyer, you could work on a fund one day, a property acquisition the next and a sukuk (a sharia-compliant bond issue) on the third. Nowadays, it is more common to specialise in a particular area – such as capital markets – and you have to work on that in both a conventional and an Islamic way. Some clients can switch from one option to the other – they might start out with a conventional deal and then find an investor that wants it to be sharia compliant, so it changes, and vice versa.” Farmida’s advice to those interested in Islamic finance is to think instead about becoming a lawyer who can work in both a conventional and an Islamic speciality: “The skills you will be offering are those of a lawyer. Our job is to structure a transaction which satisfies the client’s commercial needs and meets the requirements of the sharia, as evidenced by a fatwa provided by an Islamic scholar. We have to understand that we are not the scholars and we have been employed for our legal skills rather than our religious beliefs.”

As a partner, Farmida’s day is a mix of client work and general firm-related matters: “On any given day, I could be meeting clients, reviewing the work of associates in the team, structuring a new deal and marketing the firm, as well as dealing with internal administrative issues.” There is also some travel - particularly to the Middle East, although not exclusively: “We also have a lot of clients in Europe who are interested in Islamic finance and potentially looking to do deals which are sharia compliant.”

Ground-breaking work

A professional highlight for Farmida was working on the first UK corporate sukuk for IIT: “It was a small deal, but the fact that it was the first of its kind made it interesting. By contrast, a few years ago I worked on one of the biggest deals in the market – the $3.5 billion Dubai Ports acquisition. That really changed the market. Most of the deals I work on have an average lifespan of around three months, so you work on something, it comes to market and  you move on to the next one. That’s satisfying.”

For those keen to find out more, Farmida recommends starting with the press, such as the Financial Times and the Economist, to “get a general idea of what’s happening in the world and with Islamic finance in particular, as it gets significant coverage”. A number of textbooks are also available. And a familiarity with Islam itself will help: “If you speak Arabic or have an understanding of the principles of Islam, it makes a big difference. Having said that, there are plenty of successful people in the industry who are not Arabic speakers or Muslims; but an interest in the religion and the culture definitely helps.”

Finally, Farmida stresses the importance of experience – and not just of the legal variety: “Getting a training contract now seems more difficult, so it’s important to be an interesting and engaged person. Legal work experience gives you an advantage, but so can other experience. I interviewed a solicitor recently who’d taken a couple of years off to manage a jazz band. The skills she had picked up, such as managing a business, researching the market and meeting client needs, were all relevant for a successful lawyer. She had also done something she was interested in. I think that people can be narrowly CV-focused these  days; general life experience and doing things you’re interested in will also help you to be a more attractive candidate as you try to build a career.”