bulletEDITOR'S PICKS

 

Consumers rate UAE advice below global standard

From Middle East Mar 5 2015 @ 12:34

The public opinion of UAE financial advisers pales in comparison to the rest of the world...
view article

FCA widens coverage of DB transfers to cover all DC schemes

From Tax & Regulation Mar 4 2015 @ 12:47

The Financial Conduct Authority (FCA) has announced that all members of UK defined...
view article


bulletRELATED ARTICLES

 

bulletNEWS

 

LATEST NEWS

Aviva, Friends Life boost profits ahead of merger deal

Aviva, Friends Life boost profits ahead of merger dealBritish insurers Aviva and Friends Life Group, which agreed a £5.6bn...
view article

Trail commission ban to slash adviser numbers...

From United Kingdom Mar 5 2015 @ 17:10

Use of life assurance products could double,...

From Life Mar 5 2015 @ 12:36

MORE FROM United Kingdom

LATEST NEWS

Consumers rate UAE advice below global standard

The public opinion of UAE financial advisers pales in comparison to the rest of...
view article

Aegon launches online service for pension...

From Retirement Mar 5 2015 @ 11:47

PA ANALYSIS: Analysts split on rate cuts...

From Analysis Mar 5 2015 @ 07:00

MORE FROM Middle East

LATEST NEWS

Avoiding the potholes on the road to sustainable Indian growth

Avoiding the potholes on the road to sustainable Indian growthHermes' Gary Greenberg looks ahead at what we might expect from Saturday's...
view article

Holborn disappears from IA list of regulated...

From Middle East Mar 4 2015 @ 16:52

HSBC offers lower cost retirement funds for UK...

From Products Mar 4 2015 @ 16:49

MORE FROM Analysis



Islamic banking assets in GCC jump 14%, paced by Qatar

From Middle East Mar 27 2013 BY: Helen Burggraf , Contributing Editor , International Adviser

Add to My News Comments (0)

Add to My News Print

Add to My News

add to twitter

add to linkedin


Islamic banking assets with commercial banks in the Gulf Cooperation Council region leapt 14% in 2012, paced by Qatar, according to Ernst & Young’s Global Islamic Banking Center.

During the same period, conventional assets held in these banks grew by just 8.1%, the data, contained in a report on the E&YGIBC website, shows, although the pace of the growth of the Islamic banking assets was below that of the five-year average rate for the region, of 19%.

In total, such assets held in commercial banks in the GCC touched  $445bn (£294bn, €346bn) at the end of December, compared with $390bn a year earlier, E&YGIBC said.

The Ernst & Young researchers said that although the pace had slowed, the outlook for the Gulf’s Islamic banking industry in 2013 remains “relatively positive”.

Other findings:

  • Demand  in the GCC for sukuk, or Shariah-compliant bond-like financial products, is “set  to grow”
  • Qatar was the fastest growing GCC market for Islamic banking assets in 2012, having seen such assets grow by an estimated 23%-plus during 2012
  • Globally, Islamic banking assets grew 50% faster than those held in the banking sector overall
  • Also looking at the global picture, Islamic banking assets held with commercial banks stood at $1.55trn at end of 2012, and are projected to exceed $2trn by 2015

Data collection

Ashar Nazim, a partner in the Global Islamic Banking Center, said the quality of Islamic banking asset growth in the GCC remained “under pressure”, and added that the way the region’s banks handled the collection of data needed work.

“We expect more Islamic banks [to initiate] an honest introspection of their operating model, especially with regards to the weak data management infrastructure,” Nazim added.

"Inability of most Islamic banks to generate accurate data, and on time, remains a serious concern for the management, the board as well as the regulators.

“Where such information is available, the analysis remains very rudimentary,  and has not really translated to a true competitive advantage."

Islamic banks also remain “technologically disadvantaged”, as the software systems they use were primarily designed for financial institutions with  conventional banking frameworks, the E&YGIBC report points out.

“While the industry regulators are looking to tackle this issue, it remains a concern for the industry, leading to significantly higher operational and commercial risk,” the report says.

“In Oman for example, the Islamic Banking Regulatory Framework has recently been introduced, requiring Islamic banking institutions to ensure that all core banking systems are certified as Shariah compliant.”

Nazim added: “Major investments in transforming the operating model are under way. Discussions with management reveal that a common theme across most banks is ‘to get to know their customers’.”

Global figure

Global Islamic banking assets held with commercial banks, meanwhile, were at $1.55trn at end of 2012, and are projected to exceed $2trn by 2015, according toE&YGIBC, which said its data represents banks located in 22 major Islamic finance markets.

Add to My News Comments (0)

Add to My News Print

Add to My News

add to twitter

add to linkedin




TAGS:

COMMENTS


Have your say

(Be the first to) Have your say!

Please sign in or register here to leave a comment. Registration is free and only takes a few moments.






Share us on Twitter

SHARE US ON TWITTER
Join the community

Join us on Linked In

SHARE ON LINKED IN
Inform your colleagues

Switch to our mobile site

SWITCH TO MOBILE SITE
News on the go

Back tot he top of the page

BACK TO TOP OF PAGE
Just click here...