COMCEC Financial Outlook 2018
19
capital markets, money markets and insurance (“Takaful”). In many majority Muslim countries,
Islamic banking assets have been growing faster than conventional banking assets. There has
also been a surge of interest in Islamic finance from non-Muslim countries such as the UK,
Luxembourg, South Africa, and Hong Kong. Islamic finance is equity-based, asset-backed, ethical,
sustainable, environmentally- and socially-responsible finance. It promotes risk sharing,
connects the financial sector with the real economy, and emphasizes financial inclusion and
social welfare.17
The growing market shares and rising domestic systemic importance of Islamic finance
underscore the importance of developing strong regulatory frameworks for prudential
regulation and supervision in Islamic finance jurisdictions.
2.2 Islamic Finance Outlook
The asset size of the Islamic finance sector has grown steadily in 2017. 18 The industry’s total
worth is estimated at USD 2 trillion in 2017 that was USD 1.89 trillion in 2017 and USD 1.88
trillion in 2016. Islamic finance assets marked an 8.3% growth in US Dollar terms in 2017.
Table 3. Breakdown of IFSI by Sector and by Region (USD billion)
Islamic
Banking
Outstanding
Sukuk
Islamic
Funds Assets
Takaful
Contributions
Total
Asia 232 239,5 24,8 3,3 499,6
Gulf Cooperation
Council (GCC) 683 139,2 26,8 12,6 861,6
MENA (ex-GCC) 569 17,8 0,1 9,5 596,4
Africa (ex-North
Africa) 27,1 2 1,6 0,7 31,4
Others 46,4 1,5 13,3 0 61,3
Total 1,557.5 399,9 66,7 26,1 2,050.2
Source: IFSB 2018
In line with the improved asset, growth performance Islamic finance concentrated in a few
jurisdictions. The GCC continues as the largest domicile for Islamic finance assets. In 2017, the
market share of the region slightly decreased compared to 2016 (42.3%) and realized as 42%.
The second largest share of Islamic finance industry is the Middle East and North Africa (MENA)
(ex-GCC) which covers the 29.1% of the global Islamic financial assets. Asia has the most
improved market share with expansions in key markets such as Malaysia, Indonesia, Pakistan
and Bangladesh. The market share of Asia is 24.4%.
17 World Bank, Islamic Finance Brief
18 IFSB 2018 Report