9 - Prospects of Islamic Banking

It is envisaged that the relative market share of the Islamic banks will increase and that the industry will continue to grow nationally, regionally and internationally. At the international level, The “Ten-Year Framework and Strategies” a joint initiative by IRTI, IDB and IFSB provides that the expected future outlook of the industry in the next ten years, among others will be as follows:-

# The Islamic Financial Services Industry (IFSI) could grow to US$1.4 trillion by 2010 and US$2.8 trillion by 2015;

# More to transform into full-fledged Islamic financial system;

# Mergers and acquisitions among Islamic banking players regionally and internationally;

# Growth of Islamic capital market;

# Strengthening demand and supply of Islamic Financial services due to pubic awareness;

# Shari’ah compliance and credibility of the services to maintain to ensure growth sustainability;

# Shari’ah compliant services will continue to attract customers of other faiths due to its transparency;

# Increase research and development investment to accelerate product development for resource mobilisation, liquidity and risk management.

International bodies involves in the development of Islamic banking:-

IIFM (International Islamic Financial Market);

IIRA – International Islamic Rating Agency

LMC – Liquidity Management Centre

IRTI – Islamic Research and Training Institute

GCIBFI – General Council For Islamic Banks and Financial Institutions

AAOIFI – Accounting and Auditing Organisation for Islamic Financial Institution

IFSB – Islamic Financial Service Board.


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