The State of Islamic Banking

Among the few positive takeaways from the global coronavirus pandemic has been the broad resilience shown by the global financial system, which has done much to assure the world that lessons from the 2008 global financial crisis (GFC) have been learnt. And among the various banking sectors that have stood tall over the last 18 months, Islamic finance has arguably shone the brightest.

Indeed, despite the restrictive impact of the pandemic, Islamic banking seems to have shown considerable strength to date. According to a report published in late June by Middle East financial advisory specialists Alpen Capital and Alpen Asset Advisors, the Islamic-finance industry has remained resilient amidst the pandemic. “Islamic finance and [the] wealth management industry faced the dual shocks of adjusting to the pandemic and historically low oil prices in 2020,” noted Sameena Ahmad, Alpen Capital’s managing director. “While the industry slowed down during the year after experiencing record growth in 2019, it showed resilience and total Islamic finance assets in 2020 are estimated to match the previous year’s figures.”

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