Diversification of Islamic Financial Instruments
154
Products Principles of Shariah
Sale and Lease Back
Project Financing
Istisna’ and Parallel Istisna’
Combination of 2 or more of the following contracts:
Mudarabah
Ijarah
Tawarruq
Wakalah bil istithmar
Trade Financing
LC based on Wakala
LC based on Murabahah
Credit Card
Ujrah
Tawarruq
Overdraft Tawarruq
Factoring Bay’ al-Dayn
Letter of guarantee Kafalah
Personal financing Tawarruq
Services Financing Ijarah
Source: Created by Author
Islamic Banking Share in Total Banking Assets
As per the IFSB Report 2017109, Malaysia is among the leading countries, where Malaysia’s
share of Islamic banking compared to the country’s overall banking sector was 23.8% by the
end of 2016.
Shares of Global Islamic Banking Assets
Regarding the shares of global Islamic banking assets, Malaysia is among the top leading
countries, where Malaysia represents 9.3% of the shares of global Islamic banking assets.110
Islamic Banking Average Growth by Country (2Q2016)
As per the IFSB Report 2017, Malaysia’s Islamic banking segment experienced a growth of
9.5% in terms of assets, in the second quarter of 2016, with Islamic banking deposits growing
by 8.2% between 2Q2015 and 2Q2016. This growth was comparable with that of major OIC
Islamic banking jurisdictions including Kuwait, Indonesia, Bangladesh and Saudi Arabia.111
Islamic Banking Products
The Islamic banking in Malaysia offered wide range of products, which includes Retail Banking,
Corporate Banking, trade finance, wealth management products, and other products and
services. As for the Islamic banking deposit represent the cash flow-in in the Islamic bank, it
represents the surplus unit in the economic system. The Islamic bank used various contracts in
the deposit, which includes, Qard, Mudarabah and Commodity Murabahah. Described below
are the most popular products used by the Islamic bank.
109 IFSB, Islamic financial services industry stability report 2017
110 Ibid.
111 Ibid