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Value of Assets Managed by Global Islamic Banks Expected to Touch AED14.6 Trillion by 2020

Industry votes 44.5 % for evolving sukuk structures, 48.5 % for poor corporate credit and 70.5 % for product innovation – keys issues of Islamic finance

 
PRLog - May 26, 2010 - Dubai – May 20th, 2010: Industry analysts at the International Islamic Finance Forum 2010 are of the opinion that the value of assets managed by Islamic banks is expected to grow to AED14.6 trillion (US$ 4 trillion) by 2020 . This would be possible as the world’s Muslim population grows larger and globally more non-Islamic jurisdictions warm up to the concept of Islamic banking. However, the need of the hour according to analyst is addressing issues such as evolving sukuk structures, poor corporate credit and product innovation .

These sentiments were expressed through an electronic voting system by delegates and high-profile speakers at the Forum. Poor corporate credit was rated deemed as the primary cause of recent sukuk defaults and near defaults, followed by lack of Islamic regulatory oversight. 44.5 percent of participants voted that sukuk structures will evolve only over the next three years from asset-based arrangements to true asset-backed.

“Long-term prospects for the Sukuk market are expected to remain strong. This would be given the increasing popularity of Shariah-compliant products as well as huge investment and financing requirement in Asia and GCC,” said Baljeet Kaur Grewal, Managing Director and Vice Chairman, Kuwait Finance House (KFH) Research Ltd and speaker at the International Islamic Finance Forum 2010.  

The industry placed 70.5 percent votes on the fact that quality and quantity of Islamic finance products needs to improve to drive growth in the Islamic finance industry, while 27.3 percent felt, there needs to be significant improvement in the quality of new products to achieve real growth.

“Investors are shifting their preferences and so it is necessary to have well grounded fundamentals. Innovation and diversification of our offerings is necessary. Investors today are more cautious in their investments,” added Muhsen Mohammed Al Haribi, CEO, Sorooh Investments.

Eminent speakers like Dr. Christian Menegatti, Vice President Global Economic Research, Roubini Global Economics, Jarmo Kotilaine, Chief Economist, NCB Capital, Peter Casey, Head of Islamic Finance, Dubai Financial Services Authority (DFSA) among others shared their views across the four days on the potential of the industry and future growth.

-ENDS-

About The International Islamic Finance Forum 2010:
The International Islamic Finance Forum 2010 – Driving the Islamic Finance Industry Forward – is organized by IIR Middle East. The four-day event will touch upon the enormous potential in Shariah Compliant financing while addressing key challenges and the future of Sukuk. The panel discussions will provide insightful learning into the industry from eminent speakers touching upon in-depth understanding on the pertinent current issues. For more details about the forum and the full programme, please visit www.iiff.com / For more information on the judges, please visit: www.iirme.com/iiff/awards

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