01 November 2009
The combined assets of Islamic banks jumped by nearly 66 per cent at the end of 2008 despite massive losses suffered by the global banking sector because of the economic crisis, according to a an Arab banking group.
From around $350 billion (Dh1.2 trillion) at the end of 2007, the total assets of the world's largest full fledged Islamic banks surged to around $580bn at the end of 2008, an increase of nearly 66 per cent, the Beirut-based Union of Arab Banks (UAB) said in its monthly magazine, the Arab Banker.
"Despite the financial turmoil that crippled so many Western conventional financial institutions, Islamic bank have continued to grow in prominence and size," the magazine said, citing estimates by the Asian Banker Research.
Bank Melli Iran remained on the top of the list at the largest Islamic bank at the end of 2008, followed by Al Rajhi Group of Saudi Arabia, according to the report.
"Iranian banks are still the predominant Islamic banking players, holding seven per cent of the top 10 banks and 12 of the 100 largest banks… the Iranian banks also take up around 40 per cent of the world's 100 largest Islamic banks assets."
The report showed that the four largest Islamic banking markets – the UAE, Saudi Arabia, Kuwait and Malaysia – each have similar assets sizes.
Together, they carve out nearly another 40 per cent of the banking assets combined, with smaller banks in 10 other markets rounding out the list, the report said.
"The rankings, however, should be treated with caution… as with the Islamic bank rankings of the Banker in London, Iranian banks should be excluded until the authorisation status… of such banks.
"Bank Melli, for instance, is not incorporated as an Islamic bank and privately does not call itself an Islamic bank." The study said that despite the large size of the Iranian banks, Saudi banks are much more profitable as the kingdom's three Islamic banks in the 100-list contributed 19 per cent of the ranking's total income.
Al Rajhi Bank had the highest net income of around $1.7bn last year, the only bank to break the billion dollar mark and almost three times more than the second most profitable Islamic bank, Kuwait Finance House, said the study.
"Looking ahead, it can be already be seen that Bank Melli may not be the largest bank in the listing for much longer, as it had a mere zero per cent growth rate in 2008," it added.
The combined assets of Islamic banks jumped by nearly 66 per cent at the end of 2008 despite massive losses suffered by the global banking sector because of the economic crisis, according to a an Arab banking group.
From around $350 billion (Dh1.2 trillion) at the end of 2007, the total assets of the world's largest full fledged Islamic banks surged to around $580bn at the end of 2008, an increase of nearly 66 per cent, the Beirut-based Union of Arab Banks (UAB) said in its monthly magazine, the Arab Banker.
"Despite the financial turmoil that crippled so many Western conventional financial institutions, Islamic bank have continued to grow in prominence and size," the magazine said, citing estimates by the Asian Banker Research.
Bank Melli Iran remained on the top of the list at the largest Islamic bank at the end of 2008, followed by Al Rajhi Group of Saudi Arabia, according to the report.
"Iranian banks are still the predominant Islamic banking players, holding seven per cent of the top 10 banks and 12 of the 100 largest banks… the Iranian banks also take up around 40 per cent of the world's 100 largest Islamic banks assets."
The report showed that the four largest Islamic banking markets – the UAE, Saudi Arabia, Kuwait and Malaysia – each have similar assets sizes.
Together, they carve out nearly another 40 per cent of the banking assets combined, with smaller banks in 10 other markets rounding out the list, the report said.
"The rankings, however, should be treated with caution… as with the Islamic bank rankings of the Banker in London, Iranian banks should be excluded until the authorisation status… of such banks.
"Bank Melli, for instance, is not incorporated as an Islamic bank and privately does not call itself an Islamic bank." The study said that despite the large size of the Iranian banks, Saudi banks are much more profitable as the kingdom's three Islamic banks in the 100-list contributed 19 per cent of the ranking's total income.
Al Rajhi Bank had the highest net income of around $1.7bn last year, the only bank to break the billion dollar mark and almost three times more than the second most profitable Islamic bank, Kuwait Finance House, said the study.
"Looking ahead, it can be already be seen that Bank Melli may not be the largest bank in the listing for much longer, as it had a mere zero per cent growth rate in 2008," it added.
By Staff Writer
© Emirates Business 24/7 2009
