Business

Islamic banks hold onefourth banking sector’s shares

DHAKA, The share of Islamic banking sector is almost

25 percent of the entire banking sector at the end of JanuaryMarch quarter

in 2019, according to the Bangladesh Bank (BB) latest data.

Islamic banking industry holds almost onefourth share of the entire

banking industry in terms of deposits and investments at the end of the

quarter under review. The banking is playing a significant role in mobilizing

deposits and financing different sectors of the economy, a BB senior

official told BSS here today.

He said among different segments of Bangladesh's Islamic finance industry,

Islamic banking industry dominates and the banking segment continued to show

rapid expansion in terms of growth of assets, deposits, investments, and

number of account holders.

According to the central bank latest data, the total investments (loans in

conventional sense) in Islamic banking sector stood at Taka 2,37,279.20 crore

at the end of JanuaryMarch 2019 quarter, which went up by Taka 6,371.92

crore or by 2.76 percent compared to the previous quarter and by Taka

28,130.70 crore or by 13.45 percent compared to the corresponding quarter of

the preceding year.

During the JanuaryMarch period, the total deposits in the banking industry

reached at Taka 2,42,118.80 crore, which increased by Taka 4,751.89 crore or

by two percent compared to the previous quarter and by Taka 26,560.87 crore

or by 12.32 percent compared to the corresponding quarter of the last year.

During the quarter, InvestmentDeposit Ratio (CreditDeposit Ratio in

conventional sense) stood at 0.98 which was 0.97 at the end of December 2018.

The total remittances mobilized by the Islamic banking sector stood at Taka

8,337.75 crore at the end of JanuaryMarch 2019 quarter, which was lower by

Taka 4,738.06 crore or by 36.24 percent compared to the previous quarter as

well as lower by Taka 702.22 crore or by 7.77 percent compared to the

corresponding quarter of the preceding year.

The number of branches of Islamic banking sector including Islamic branches

or windows of conventional commercial banks stood at 1,252 at the end of the

JanuaryMarch quarter while there were 1,241 branches during the previous

quarter and 1,181 during the corresponding quarter of 2018.

After analyzing the sectorwise investments, it is observed that investment

in the trade and business sector was 36.63 percent, which was the highest

among all sectors at the end o f JanuaryMarch quarter, 2019.

The next position was occupied by industrial sector, which stood at 27.66

percent followed by Micro Small and Medium Enterprises (MSME) (20.53

percent), others (5.61 percent), real estate (5.97 percent), agriculture

(1.53 percent), transportation (1.36 percent), electricity, gas and water

supply (0.97 percent) and poverty alleviation (0.08 percent).

In the quarterly report, BB said Islamic banks should pay more attention in

Research and Development (R and D) to devise the proper guidelines and policies

to promote investments under the mudaraba and musharaka modes.

Source: Bangladesh Sangbad Sangstha (BSS)