Improving Public Debt Management
In the OIC Member Countries
60
Figure 3-16: Islamic Banking Share in Total Banking Assets by Country (2015H1)
Source: IFSB (2016, p. 8).Market shares of the Islamic banking sector are expected to grow by a considerable amount
over the next years in Saudi Arabia, Malaysia, the United Arab Emirates, Kuwait, Turkey, and
Indonesia, while stabilizing in Bahrain, Pakistan and Qatar. In general, worldwide growth rates
of the Islamic finance sector have exceeded growth rates of the conventional banking sector by
190% on average. The average annual growth rate of the Islamic banking sector is estimated to
equal 19% between 2014 and 2019 across Qatar, Indonesia, Saudi Arabia, Malaysia, the United
Arab Emirates and Turkey (Ernst & Young 2015). Islamic banks also operate in countries
where Muslims only account for a minority of the population, e.g., in Kenya, South Africa or the
United Kingdom. Islamic finance is often considered a promising innovation and addresses a
substantial minority in these countries (Lewis and Algaoud 2001, Song and Oosthuizen 2014).
In the Eurozone, an Islamic bank has opened in Germany, while plans for an Islamic bank in
Luxembourg are being developed (COMCEC 2016a).