Qatar among Top 10 countries by Islamic Assets globally; Alpen Capital

By Rahul Vaimal, Associate Editor
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UAE-based investment banking firm Alpen Capital has placed Qatar among the ‘Global Top 10 Countries by Islamic Assets’ in its latest report. 

In its ‘Islamic Finance and Wealth Management Report’, the investment firm reveals that the country has $144 billion worth of Islamic finance assets, standing up at 40 percent of the country’s GDP in 2019.

Between 2014 and 2019, the country registered a compound annual growth rate (CAGR) of 10.7 percent in Islamic finance assets, the fourth highest in the world.

Regional Dominance 

Across the globe, the GCC region had the highest share of Islamic finance assets with 43.6 percent amounting to $1,253 billion. While other MENA (Middle East and North Africa) countries had a global share of 26.3 percent ($755 billion), countries in South East Asia contributed to 23.8 percent of Islamic finance assets calculated at $685 billion.

The growing Muslim population in the South East Asia region along with a rising portion of Muslims who seek to make investments that are in line with their religious beliefs enabled the region to have higher growth compared to other regions in the world.

Regional governments, particularly Malaysia and Indonesia have played an active role in promoting Islamic finance instruments and rolled out a number of regulations to support the landscape.

With almost 70 percent (69.3 percent) contribution to the global financial industry, Islamic banking maintains to be the largest sector in the industry.

Although the total share of Islamic banking has fallen from 73.1 percent in 2014 due to the rapid rise of Islamic Capital Market (ICM) instruments, especially Sukuk and Islamic funds, it has consistently recorded a CAGR of 6.7 percent over the past five years.

The sector recorded a high of 14.2 percent year-on-year growth in 2019 amounting to $1,993 billion in global assets. This growth can be largely attributed to improvements in assets across the GCC, which witnessed significant mergers of Islamic banks to strengthen competitiveness, attract stable deposits and enhance efficiency.

GCC countries collectively accounted for 45.2 percent of the total Islamic banking assets globally.

Meanwhile, Qatar registered an 8.4 percent year-on-year growth in assets to reach $121.7 worth of assets during 2020 supported by strong regulatory support and focus on technological developments that allowed easy and safe execution of services amid the pandemic.

Related: Capital Intelligence affirms Qatar’s long term FCR, LCR rating at ‘AA-‘