Islamic banking growth outpaces conventional peers in key markets

According to Moody's, the Islamic banking sector continues to outpace growth of conventional banking in key markets, often supported by proactive regulations and strong retail customer demand. Analysts say the broader slowdown in growth, reflects more challenging economic conditions across a number of core Islamic markets, particularly in the GCC countries due to lower oil prices. Despite the current challenges the sector still has potential for further growth, especially in countries such as Oman, Turkey and Indonesia where the penetration of Islamic financing assets remain relatively low. According to Khalid Howladar, Global Head of Islamic Finance at Moody’s, Oman has been highly successful in achieving a high level of Islamic banking penetration. Oman's example shows the effectiveness of government support and regulation in acting as a catalyst for growth.