The Islamic Corporation for the Development of the Private Sector (ICD) and the London Stock Exchange Group (LSEG) unveiled their annual report on the Islamic finance industry, titled “Navigating Uncertainty.” The report was launched during the 18th AAOIFI-IsDB Annual Islamic Banking and Finance Conference, supported by the Central Bank of Bahrain.
Despite global economic uncertainties, the report reveals a resilient Islamic finance industry, with assets reaching a record $4.5trn in 2022. This represents an 11% increase from the previous year and a 163% increase since 2012. Notably, Islamic banking accounts for 72% of the industry’s total assets.
The report highlights several factors driving this growth, including: Strengthening domestic Islamic finance sectors in major markets such as the GCC, Malaysia, and Indonesia.
Pakistan’s significant efforts to align its financial system with Islamic principles.
Growing issuance of green and sustainability Sukuk as a key theme at COP28 in Dubai. Global ESG Sukuk reached a record $8.4bn in 2022, with Islamic ESG funds amounting to $6.6bn in value outstanding.
The report also introduces the Islamic Finance Development Indicator (IFDI), a composite index measuring the overall development of the industry across 136 countries. Data is collected based on more than 10 key metrics, including knowledge, governance, sustainability, and awareness.
“The industry is expected to continue its growth trajectory,” said Eng.
Hani Salem Sonbol, Acting CEO of the ICD. “We are pleased to see the consistent citation of the IFDI by regulatory authorities and multilateral organizations worldwide.”
Mustafa Adil, Head of Islamic Finance at LSEG, added, “This report underlines our commitment to monitoring and charting the development of the Islamic finance industry. Reaching the 10th anniversary of the IFDI marks a significant milestone and reminds us of the need for continued support for this rapidly growing sector.”
The report concludes that despite global uncertainties, the Islamic finance industry remains resilient and poised for continued growth, driven by strong fundamentals and a commitment to sustainable practices.—Daily News Egypt
