Islamic banking part of mainstream financial system


KUALA LUMPUR: Islamic banking has now become part of the country's mainstream financial system and has the potential to generate the country's economic growth, said Prime Minister Datuk Seri Abdullah Ahmad Badawi.
In a written reply to Datuk Abdul Rahim Bakri (BN-Kudat) in the Dewan Rakyat, the prime minister said Islamic banking has cornered 12.2% of the domestic financial market with assets totalling RM133 billion. In the Takaful sector, it has cornered 6.1% of the market with assets worth RM6.9 billion.

“The Islamic financial system in the country is positioned at a strong and solid position,” said Abdullah, who is also the Finance Minister.

On the international stage, the prime minister said Malaysia had been acknowledged as the leader in Islamic banking.

“Malaysia is the largest Sukuk issuer, accounting for 67% of total Sukuk yet to be redeemed. Malaysia is also the pioneer in the issuance of independent Islamic bonds when it launched the US$600 million Islamic bonds in June, 2002."

Abdullah said the decisions by Al Rajhi Banking & Investment Corp of Saudi Arabia, the world's biggest Islamic banking group, and Kuwait Finance House to set up their operations in Malaysia reflected the country's success in promoting Islamic banking.

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