Friday, January 27, 2012

StanChart Saadiq sees local Islamic banking penetration up 3%

STANDARD Chartered Group's Islamic banking arm Standard Chartered Saadiq Bhd sees the penetration rate of Islamic banking in Malaysia to rise 3% to 25% this year, parallel to the global trend.

StanChart global head of Islamic banking Wasim Saifi said Islamic banking is growing rapidly in the international financial markets, and the bank sees the same applies in Malaysia.

Without disclosing specifics, Wasim said there are several push factors, among which include the perception that Islamic banking has gotten sophisticated by well-discerned banking customers.
 He added that Islamic banking have become simpler and widely accessible.

“Islamic banking also projects stability to both Muslims and non-Muslims alike.” 

“We see ample opportunities to help our customers and potential customers worldwide do the switch from conventional banking. The fact that Islamic banking asset represents only 1% of the global conventional banking's, there is vast growth potential, especially with over one billion Muslims worldwide,” he told The Malaysian Reserve in a recent interview.

Indonesia, for example, has the most Muslim population and yet, its Islamic banking penetration rate was still 3%, he said, quoting Pakistan as another populous Muslim nation with only 9% patronizing Islamic finance.

“We will definitely see growth momentum in the next two to three years,” said Wasim, adding that the StanChart Saadiq is looking to spread its wings to the African continent.
For Malaysia, StanChart sees the progress made in policy framework, comprehensive regulations and product diversification have encouraged the acceptance of and switch to Islamic banking locally.

To meet the increasing demand, StanChart is looking at opening up more Saadiq branches, with eight in sight in the near-term.
According to its website, StanChart claimed to be the first international bank in Malaysia to offer Islamic banking products in 1992, with its Saadiq arm officially launched in 2008. StanChart has footprint in over 70 countries.

[By Mohd Rashdan Jamaluddin, The Malaysian Reserve; Jan 9, 2012]