As with the 2007 listing, Iranian institutions again dominate the 2008 Top 500, accounting for sharia-compliant assets (SCAs) of $235.3bn, a strong 27.5% increase on the previous year and a significant 37.5% of the overall SCA aggregate.
While the country ranking remains the same at the top, with Iran again being followed by Saudi Arabia, Malaysia, Kuwait and the UAE, it is important to note how much the SCAs have grown in the major markets. Along with strong Iranian growth, Saudi institutions expanded by 26.1% to $92bn, Malaysian firms were up 32.3% to $67.1bn and Kuwaiti institutions rose by a whopping 44.3% to $63.1bn. UAE firms were up 35.9% to $49.1bn.
Geographical breakdown
In examining the geographical breakdown it is clear that not only are the Gulf Co-operation Council (GCC) states the largest area for SCAs but they are increasing their role. The GCC institutions reached $262.7bn in the 2008 listing, accounting for 41.2% of the aggregate total, up from 35.6% in last year’s listing.
The non-GCC Middle East and north Africa (MENA) states, which are dominated by Iran, are also increasing their role. In the 2008 listing the non-GCC MENA institutions reached $247.6bn, which amounts to 38.8% of the aggregate total, well above the 35.3% share in last year’s listing.
This means that MENA institutions, both GCC and non-GCC, account for 80% of the Islamic finance market, significantly up from the 70.9% registered last year.
But while Malaysia is expanding its role in Asia, growing by 32.3% to reach $67.1bn, the size of Islamic institutions in Asia is declining in relative terms to 13.5% of the total, down from 23.9% last year. Indonesia, nevertheless, is growing and expanded its SCAs by 34.4% to reach $3.4bn, giving some prospects of an Asian resurgence.
Other important developments include the expansion of the UK as an Islamic financial centre. In the 2008 listing, the UK total rose 59.2% to $17.5bn from $11bn last year, mainly as a result of UK-registered HSBC Amanah’s healthy growth to $15.2bn from $9.7bn last year.
With the UK now attracting an increasing number of Islamic institutions and firms such as Standard Chartered Saadiq, which is still not disclosing its SCAs, it is likely that the UK will play a growing role in the industry in the years ahead.
Geographical distribution of reported sharia assets, GCC, 2008 (%)
