Islamic banks outpacing conventional banks
According to a study conducted by Asian Banker research group, the world’s 100 largest Islamic banks have outpaced conventional banks with an annual asset growth rate of 26.7%. The Islamic institutions registered a growth to approximately US$350 billion in assets, crossing the 19.3% growth rate of mainstream banks. This growth rate is above previous estimates of 15-20%. The largest company in the Asian Banker’s list of the top-100 Islamic banks is Iran’s state-owned BMI, which has total assets of $39.4bn. The study reveals that the potential of Islamic banks to eat away conventional bank’s business model is huge. The threat would get worse as Islamic banks grow organically or as a result of intensive mergers and acquisitions.
