Risk Management in
Islamic Financial Instruments
93
Chart 4.42: Liquidity Ratio for United Arab Emirates (UAE) Banks
Source: BankScope Database 2013
4.4.5 Bangladesh
Bangladesh represents a vibrant market for Islamic banking over the last couple of decades. At
present, seven (7) full-fledged Islamic banks are operating with a total of 615 branches and
maintaining a growth rate of around 10.0%-12.0% per year. In addition, sixteen (16) other
scheduled commercial banks, including two foreign banks with 22 branches and seven other
Islamic insurance companies are also providing Islamic banking and insurance services.
Islamic banks operate in the same legal environment as their competing conventional
commercial banks. In addition, Islamic banks are also required to abide by the guidelines for
conducting Islamic banking issued by the Central Bank of the country.
4.4.5.1 Bangladesh Banking Sector
The following analysis consists of data from 6 Islamic banks of Bangladesh for which data is
available on the BankScope database. The banks are: (6) Islamic Banks: ICB Islamic Bank
Limited, Social Islami Bank Ltd, First Security Islami Bank Limited, Al-Arafah Islami Bank Ltd.,
Shahjalal Islami Bank Ltd., and Islami Bank Bangladesh Limited.
The average total asset of the Bangladesh Islamic bank is 1,584 million USD, with average
deposits of 1,398 million USD. On average, Islamic banks in Bangladesh employs 639 workers
across 28.67 branches.
344,15
57,14
77,45
25,88
150,38
59,58
83,84
19,12
0
50
100
150
200
250
300
350
400
Interbank Ratio
%
2011
Net Loans / Tot Assets
%
2011
Net Loans / Dep & ST
Funding
%
2011
Liquid Assets / Dep & ST
Funding
%
2011
U.A.E. Conventional U.A.E. Islamic