How big will global Islamic finance assets grow by 2022?
The Islamic Finance sector continues to grow and evolve over the years. The State of Global Islamic Economy Report noted the Islamic finance assets is expected to rise almost double from $2 trillion in 2016 to $3.8 trillion by 2022. One of the many factors that pushes the growth of Islamic finance is the existence of Islamic financial technology (Islamic fintech).
The hub of Islamic finance in Southeast Asia
The hub of Islamic finance in Southeast Asia is Malaysia. The development of Islamic finance in Malaysia has come a long way. Since the success establishment of Lembaga Tabung Haji (Pilgrims Fund Board), the country continued to develop the Islamic finance sector. In 1993 after the first Islamic bank was listed on the Kuala Lumpur Stock Exchange, the government permitted other banks to offer Islamic banking services which received positive responses. According to The State of Global Islamic Economy Report 2017/18, the country has a leading ecosystem for Islamic Finance which is evidenced by a strong governance, a large asset base, and a very high awareness and interest in the sector.
The country that has the highest global share of Islamic finance banking assets in 2015
According to the World Economic Forum, Saudi Arabia is the country that dominated 31.7% of the global share of Islamic finance banking assets in 2015. In the worldwide, Ernst & Young reported that there was an increase of 17% in Islamic finance assets between 2009 and 2013. Although the growth has been significant and impressive, the share of Islamic financial assets is still very small compared to the global financial assets.
The country with first modern commercial Islamic bank in the world
In 1975, Dubai Islamic Bank (DIB) became the first modern commercial Islamic bank in the world which was created a new history back then. Since then, the development of Islamic banking in United Arab Emirates (UAE) continued to show a remarkable growth. The State of Global Islamic Economy Report highlighted that UAE was listed in the top 5 Islamic finance markets with $202.3 billion assets. In 2017, Islamic Banking Index published a report showing that more non-Muslim people in UAE turning to Islamic banking.
The country issuing the first global sukuk worth $9 billion rated A+
In 2017, Saudi Arabia received a final rating of 'A+' by Fitch Ratings for its trust certificate program and US dollar-denominated sovereign global certificates (sukuk) issued through KSA Sukuk Limited under the program. As a leading center for Islamic Finance, Saudi Arabia has a significant role in the Islamic economy. The total Islamic finance assets of Saudi Arabia reached $473 billion making the country ranked the second just below Iran.