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TOP 500 Islamic Institutions
How fast is the Islamic finance industry growing? The Banker attempts to answer this question with the launch of a new listing: Top 500 Islamic Financial Institutions. The pioneering role of the listing is to provide a benchmark for the future, which can be improved on for the good of the industry. Better disclosure is expected to flow from the publication of listings such as this as greater competition puts pressure on institutions to increase transparency in this area. Stephen Timewell and Joe DiVanna report.
From emergence to innovation
Islamic finance has established solid roots in the Gulf states, Malaysia and Indonesia and is set for a roll-out to the world’s 1.6 billion Muslims, with all the challenges that this entails. Joe DiVanna explains.
Worldwide partnership
Long-term viability and sustainability will come from increased interoperation between sharia-compliant financial institutions throughout the world, says Joe DiVanna.
From niche to mainstream
The Islamic finance industry is rapidly evolving and expanding, with growth of banking assets estimated at $750bn and growing at a rate of 15% to 20% a year. Nabeel Shoaib explains.
GCC region holds biggest slice of sharia assets pie
The Top 500 Islamic financial institutions in the world have amassed sharia-compliant assets of $500.5bn according to The Banker’s first comprehensive listing of the Islamic finance industry.
Iran dominates in the world of sharia compliance
The Top 25 country ranking of the Top 500 Islamic institutions clearly demonstrates that Iran, Saudi Arabia and Malaysia are by far the three largest countries providing Islamic finance, with Iran’s total amounting to $154.6bn of sharia-compliant assets (SCAs) accounting for 30.9% of the global aggregate total of $500.5bn.
Compliance levels grow at astounding rates
The Top 15 countries in the world by sharia-compliant assets (SCAs) are determined not only by the size of each country’s financial sector but also the degree to which it is sharia compliant.
Investment banks and insurance firms in the net
Islamic finance covers many areas and in this exercise The Banker did not want to exclude any Islamic financial institution. Clear definitions of what constitutes a non-bank institution need to be improved but we wanted to include not only investment banking operations and Islamic investment companies, as distinct from banks, but also Islamic insurance operations.
Growth attracts new players
In this vibrant young industry, many new players are emerging. The combination of huge liquidity in the Gulf region from oil prices in excess of $80 a barrel and the attraction of new opportunities through Islamic finance has led to a large expansion of Islamic institutions both in the Gulf and elsewhere.
New generation must set sights on profit and returns
How profitable are Islamic financial institutions? With Islamic instruments and different reporting standards in some cases, direct comparisons with traditional western interest-bearing instruments have often been difficult to make.
