Islamic Banking gains big in Gulf
07 Dec 2011 04:48 GMT
A rough estimate of the assets with commercial lenders is expected to be more than double of $990 billion dollars by 2015.

According to the report published by Ernst & Young's inaugural World Islamic Banking Competitiveness; the market share of Islamic banking in the Gulf is 25% in 2011. This report is published in the first week of December. The Islamic banking assets are being expected to cross 1.1 trillion dollar in 2012 that would be the 33% of the total assets in 2010. In 2010, the assets were only $826 billion. The Islamic Banking assets in North Africa and Middle East were increased around420 billion dollar in 2010 that has increased rapidly.  The report has predicted that the mainstream customers services are being fulfilled from conventional as well Islamic banking and the Islamic banks are competing well and there will be over $1980 billion assets with the Islamic banking by 2015.

Countries belonging to the Organization of Islamic Conference (OIC) offer huge opportunities for market the expansion of the markets through Islamic banking. For the expansion in true form, it is important to establish Islamic Sovereign Wealth Funds (ISWF). There are people who support the Islamic banking because of the religious inclination towards Islam. The Islamic banking includes all kinds of interest-free trade. From last two decades, the Islamic banking has become very popular for following the Islamic laws for trade and it provides the consumers with all type of facilities a conventional bank provides.

The recent changes that government has made will move the Islamic banking towards open trade with the local markets. There will be positive changes for regulation as well. The report Ernst & Young has presented the modifications to assist the growth of Islamic banking in the area crossways.

There are many things that affect the number of total assets produced for the countries in Gulf and other Islamic countries. It has been noticed, there is a big relation between the Islamic government rule and the financial matters but it is not as black and white as it seems. There are many countries that are not following strictly the Islamic conduct but still are generating huge assets for the Islamic banking. Some experts say, if the Islamic banking system promises the Halal trade and completely provides the facilities that a conventional bank is providing or makes it even better system, chances are 75% of the Muslims will shift their assets to the Islamic banks as they are getting more and more popular and people have accepted them well.

Many markets have been opened now in the region those are being expected to create enhancement in the region. According to a few analysts, there is the probability of the Islamic banking market of $6 billion to $10 billion that could come forward over the next five years in Oman only as there have been two licenses awarded. In Turkey, the estimated worth of the market is $25 billion that is growing at the rate of more than 30% from last five years. In the Mena joint Islamic banking asset is expected to be raised from $15 to $19 billion in 2015.

-- Al Arabiya Digital