Malaysia Remains Main Growth Driver Of Global Islamic Assets

From Farhana Poniman BAHRAIN, Dec 2 (Bernama) -- Malaysia, which plays a fundamental role in the modernisation of Islamic banking practices, will remain one of the major growth drivers of global Islamic assets. Thomson Reuters Acting Head of Islamic Finance Mustafa Adil said the global share of Islamic banking assets is expected to increase to 80 per cent in 2020 from 74 per cent as at end of 2014. "The expected increase is underlined by the strength of the Islamic banking system in many nations, especially Malaysia, Bahrain and the United Arab Emirates," he said during his presentation at the 22nd Annual World Islamic Banking Conference here Wednesday. Mustafa also revealed the findings of the Islamic Finance Development Report 2015, which is a joint initiative between the Islamic Corporation for the Development of the Private Sector and Thomson Reuters. The report assessed 108 nations' progress in the Islamic finance industry using five indicators, namely quantitative development, knowledge, governance, corporate social responsibility, and awareness. According to the report, Islamic banks are expected to be the biggest growth drivers for Islamic finance with a projected growth of 11 to 12 per cent per year, reaching US$2.6 trillion in 2020. This, along with the growth of Islamic funds, takaful, sukuk and other Islamic financial institutions, would enable Islamic finance assets to reach US$3.2 trillion by 2020. The report also quoted Moody's Investors Service Global Head of Islamic Finance Khalid Ferdous Howladar as saying that Malaysia is well on track to transform its Islamic banks into full-service, asset manager-type of organisations from merely banking services. He said at this juncture, only Malaysia was able to do this, given the country's new regulations which ensured a clean disclosure on deposit versus investment-type products. "The Malaysian government is highly supportive of fostering a more equitable and investment-type activity for Islamic banks," he added. --BERNAMA