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Wednesday 02 Dec 2015 - 13:34 Makkah mean time-20-2-1437
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Dubai, (IINA) - Islamic banks expected to see strong growth across the GCC with total Shariah compliant commercial banking assets surging 18 percent ($91 billion) year on year in 2014, Gulf News reported citing the World Islamic Banking Competitiveness Report 2016 from EY (Ernst & Young).
Globally, Islamic banking assets with commercial banks are set to exceed $920 billion growing at a compounded annual growth rate of about 16 percent.
Islamic banking assets of commercial banks based in Qatar, Indonesia, Kingdom of Saudi Arabia, Malaysia, the UAE and Turkey (together denoted as QISMUT) are set to exceed $801 billion in 2015 and will represent 80 percent of international Islamic banking assets.
Data shows in some of the traditional markets such as Indonesia and Turkey, Islamic asset growth has either plateaued or declined marginally.
“Growth trajectories of some of the historically strong markets are seen diverging with different factors impacting the asset growth. In turkey, geopolitics has impacted growth but the slowdown is temporary. Indonesia will require more regulatory stimulus to lift growth in the sector,” said Ashar Nazim, Partner, Global Islamic banking centre, EY.
In some of the high growth markets such as the UAE and Malaysia, Islamic banking asset growth appears to be converging to that of traditional banks in the range of 20 to 25 percent. “This calls for new initiatives to boost the market share of Islamic banks. There are efforts in both these countries to drive growth by linking Islamic banking to Islamic economy initiatives. In addition, these markets will need to upgrade the overall industry infrastructure such as regulations, supervision, legal and accounting infrastructure to gain market share,” Nazim said.
SM/IINA
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