Pakistan’s Islamic Banking Industry Continues to See Growth

Pakistan’s Islamic Banking sector includes four fully-fledged Islamic banks, and 17 conventional banks that have Islamic banking services. Data released by the State Bank of Pakistan, in its Islamic Banking Bulletin (IBB), showed that the assets within the Islamic banking industry increased 9.6% YoY to reach PKR 3.28 trillion. This raised the sector’s share of assets to 14.9% at the end of 2019, compared to 9.4% reported in March 2014.

Looking at modes of financing within the Islamic banking industry in 2019, Diminishing Musharakah was the market leader with 34.1% share, followed by Musharakah accounting for 19.8%, and Murabahah with 12.9%.

Deposits in the Islamic Banking...