Wednesday, December 05, 2012

Local banks dominate Islamic finance

MALAYSIA'S Islamic financial services are still dominated by local banks despite the participation of a great number of foreign banks in the sector. Deputy Finance Minister Senator Datuk Dr Awang Adek Hussin told the Dewan Rakyat that local banks currently controlled about 80 per cent of the sector. Awang, who was wrapping up the debate on the Islamic Financial Services Bill 2012 yesterday, said the sector, which had been introduced gradually in the country, was experiencing healthy growth. He said the bill had provisions to ensure that priority for local participation was maintained at all times. "The sector's assets which stood at only 1.4 per cent of the market in 1990, now stands at about 23 per cent and is worth RM459 billion. "The average growth of the Islamic financial services is now 6 per cent of its assets and 18 per cent of deposits." He said the growth rate of conventional banks was only about 6.3 per cent and 7.3 per cent respectively. He said the success of the country's Islamic financial services had even attracted Saudi Arabia's largest bank, the Al Rajhi Bank, to open its first branch outside of Saudi Arabia in Malaysia. Read more: Local banks dominate Islamic finance - General - New Straits Times

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