Islamic banking and finance is likely to continue growing in the Asia-Pacific region but the real test of its sustainability will be how the system reacts to a major financial crisis, a report said yesterday.
The industry is set to develop its own identity separate from conventional banking as new Islamic financial products are rolled out, said the report by Financial Insights, a company under market research and analysis firm International Data Corp.
"The future for Islamic banking and finance in Asia looks bright and continued support by government authorities should ensure this future is grounded in strong, sensible regulation," said Abhishek Kumar, an analyst at Financial Insights.
He noted, however, that the industry's growth in recent years has occurred during a period of economic expansion, and there are concerns over how it would perform during a major financial crisis.
financial crisis
"How the system handles a major financial crisis or recession will be the true test of its sustainability," Kumar said.
Conventional banking systems in several Asian countries crumbled during a financial crisis in 1997, exposing the industry's weaknesses and excesses. They have since recovered.
Islamic financial assets under management are currently valued at more than US$400 billion worldwide, with the industry growing at double digits annually, the report said.
Islamic banking fuses principles of Shariah and modern banking. Islamic funds are banned from investing in companies associated with tobacco, alcohol or gambling considered taboo by Muslims.
As the industry matures, there is likely to be a shift from Islamic banking products that resemble conventional ones to completely new offers, helping it to develop its own unique identity, the report said.
complementary
"The ... industry has reached a point where, in some product areas, it can provide a credible alternative to traditional banking products," it said, adding that this will be complementary rather than competitive.
The report added that Islamic funds are attracting a large number of non-Muslim clients.
Malaysia has "effectively established itself as the regional, if not global, hub for Islamic finance," the report said.
Indonesia, Pakistan, Thailand and Singapore are also among the countries in Asia actively promoting Islamic finance, it said.
LEVERAGE: China did not ‘need to fire a shot’ to deny Taiwan airspace over Africa when it owns ‘half the continent’s debt,’ a US official said, calling it economic warfare The EU has raised concerns about overflight rights following the delay of President William Lai’s (賴清德) planned state visit to the Kingdom of Eswatini after three African nations denied overflight clearance for his charter at the last minute. Taiwanese allies Paraguay and Saint Kitts and Nevis, as well as several US lawmakers and the Inter-Parliamentary Alliance on China (IPAC) condemned China for allegedly pressuring the countries. Lai was scheduled to fly directly to Taiwan’s only African ally from yesterday to Sunday to celebrate the 40th anniversary of King Mswati III’s accession and his 58th birthday, but Seychelles, Mauritius and Madagascar suddenly revoked
The final batch of 28 M1A2T Abrams tanks purchased from the US arrived at Taipei Port last night and were transported to the Armor Training Command in Hsinchu County’s Hukou Township (湖口), completing the military’s multi-year procurement of 108 of the tanks. Starting at 12:10am today, reporters observed more than a dozen civilian flatbed trailers departing from Taipei Port, each carrying an M1A2T tank covered with black waterproof tarps. Escorted by military vehicles, the convoy traveled via the West Coast Expressway to the Armor Training Command, with police implementing traffic control. The army operates about 1,000 tanks, including CM-11 Brave Tiger
China on Wednesday teased in a video an aircraft carrier that could be its fourth, and the first using nuclear power, while making an allusion to Taiwan and vowing to further build up its islands, as it looks to boost maritime power, secure resources and bolster territorial claims. The video, issued on the eve of the 77th founding anniversary of the Chinese People’s Liberation Army Navy, featured fictional officers with names that are homophones of three commissioned aircraft carriers, the Liaoning (遼寧), Shandong (山東) and Fujian (福建). Titled Into the Deep, it showed a 19-year-old named “Hejian” (何劍) joining the group, sparking
BIG YEAR: The company said it would also release its A12 chip the same year to keep a ‘reliable stream of new silicon technologies’ flowing to its customers Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said its newest A13 chip is to enter volume production in 2029 as the chipmaker seeks to hold onto its tech leadership and demand for next-generation chips used in artificial intelligence (AI), high-performance-computing (HPC) and mobile applications. TSMC, the world’s biggest contract chipmaker, also unveiled its A12 chip at its annual technology symposium in Santa Clara, California. The A12 chip, which features TSMC’s super-power-rail technology to provide backside power delivery for AI and HPC applications, is also to enter volume production in 2029, a year after the scheduled release of the A14 chip. The technology moves
RSS