Bahrain’s Islamic Banking Sector Projected to Grow Jolted By M&A
- Date: 10-Jun-2021
- Source: Al Bawaba
- Sector:Financial Services
- Country:Bahrain
Bahrain’s Islamic Banking Sector Projected to Grow Jolted By M&A
The increase will be driven by bank mergers and acquisitions, continued Islamic financing growth amid a recovering economic environment, rising public awareness of Islamic products, and greater use of fintech solutions.
The Islamic banking sector benefits from mainstream relevance and high awareness of Islamic products, a wide branch and digital banking network, government support in the form of an enabling regulatory framework and the availability of Islamic liquidity-management instruments.
The sector continues to have significant importance with total Islamic banking assets reaching USD35.7 billion at end-2020 or about 106% of Bahrain's GDP. The domestic market share of Islamic banks has been steadily rising from 35.4% in 2015, driven by an increase in real estate financing, but the pandemic and lower oil prices in 2020 resulted in domestic asset growth of Islamic banks (2.1%) lagging conventional banks' (5.7%).