Islamic Fund Management
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4.2 Malaysia
4.2.1 Overview of Malaysia’s Islamic Finance and Islamic Fund Management
Industries
A Snapshot of Malaysia’s Islamic Financial Market Landscape
As depicted in and Malaysia boasts one of the world’s most advanced
Islamic financial markets. Its ICM hosts the world’s largest sukuk market, with an average
annual growth rate of 11.0% between 2007 and 2017. As at end-2017, Malaysia accounted for
USD36.5 billion (or 34.6%) of the total USD105.5 billion of global sukuk issuance.
The country’s Islamic fund management industry has been charting strong growth and is
ranked second as at end-2017, after Saudi Arabia (excluding Iran). Malaysia has been chosen
as a country case study and is categorised as ‘matured’ due to the following factors:
 Level of its Islamic financial market development and recognisable market share in
global Islamic banking, ICM (e.g. sukuk, fund management) and takaful.
 Operates within a well-established and facilitative regulatory environment
benchmarked to the IOSCO principles, supported further by its Shariah governance
and tax frameworks.
 Clear methodology and guidelines on Shariah screening.
 Robust performance of its ICM has contributed significantly to a sustainable supply of
investable Shariah-compliant assets.
Figure 4.1: Malaysia's Islamic Financial Market
Source: Adapted from SC