Malaysia’s Islamic Banks Expected to Further Consolidate: S&P

S&P Global Ratings (S&P) forecasts further consolidation within Malaysia’s Islamic banking sector, as the growing trend of consolidating companies and resources into the hands of larger firms continues.

Why it Matters?

In the past 10 years, Islamic banks in Malaysia have remained a primary driver of credit expansion amongst Malaysian banks, with this trend not expected to change despite the effects of the COVID-19 pandemic. According to a report by S&P issued on the 5th of July 2021, Islamic bank subsidiaries under Malaysia’s eight local banking groups comprised over 76% of domestic Islamic financing market share at the end of 2020, a figure that has risen from 67% in 2010. With several foreign investor-backed, stand-alone Isl...