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DUBAI — The emergence and growth of the Islamic finance industry is a phenomenon that has generated considerable interest in the financial world in recent years according to a recent report by the National Bank of Dubai.
Given its ability to offer innovative financial solutions to an under-served market, it is seen as a community banking niche with considerable growth potentials. In the Muslim world, and increasingly in the West, significant segments of the institutional and retail markets are actively considering this alternative for their financing and investment needs.
However, the general availability of information remains limited for what is still a young and evolving industry. The current Muslim population of the world is at least one billion. It is estimated that the Middle East houses around 15 per cent of the world's Muslims. This explains why the greatest concentration of Islamic financial activities is in this region.
Today, more than 250 Islamic banks (90 institutions of them are in the Middle East) are operating from China to the US. Western banks, through their Islamic Units in U.K, Germany, Switzerland, Luxembourg, and others countries also practice Islamic banking.
Growth prospects of Islamic financial institutions
Pure-play Islamic Banks and financial institutions manage over $250 billion of assets and a further $200- 300 billion is managed by the Islamic windows and subsidiaries of international banks. The GCC region has been the hotbed of activity as far as the Islamic Banking industry is concerned, where 41 Islamic financial institutions are currently operating in the GCC countries (of which 18 are banks). Qatar and Bahrain are the leaders and hold a 70 per ...