Based on the results of this year’s Top Islamic Financial Institutions ranking, the sharia-compliant financial industry enjoyed a successful 2013. Growth and expansion across a number of key data indicators went hand in hand with an increase in the quality of the industry’s development. This performance is reflected by upswings along key data indicators in this year’s report, including total sharia-compliant assets, which increased by 9.81% year on year. However, the data from this year confirms that, while growth is still positive, it is likely to remain at a slower-than-usual pace over the coming years. The global compound annual growth rate (CAGR) for the industry reduced marginally to 15.73% from 16.02% last year.
Moreover, the positives to be drawn from this bigger picture mask a number of challenges faced in specific markets as Islamic banks’ margins continue to be squeezed by a lower growth global environment and greater competition. It should be noted that these relatively slower performances were predominantly reserved for smaller and less developed sharia-compliant markets. In terms of the larger, higher growth jurisdictions, including Malaysia and the Gulf countries, 2013 was another strong year.
