The Egyptian Islamic Finance Association (EIFA) has revealed that the volume of Sharia-compliant banking in the Egyptian market reached about EGP 378bn by the end of March 2021.
This ensures that this segment makes up about 5.3% of the Egyptian banking market volume, an increase of EGP 47bn, and a growth rate of 14.3% compared to March 2020.
EIFA recently issued its quarterly report on the developments in Islamic banking in the Egyptian market at the end of March 2021, compared to the end of March 2020.
It was prepared using reports of banks and the Central Bank of Egypt (CBE) published in March 2020.
In its report, the association explained that the Egyptian market includes 14 banks that have a licence from the CBE to provide Islamic banking products, including three fully Islamic banks.
These banks are Faisal Islamic Bank, Al Baraka – Egypt, and Abu Dhabi Islamic Bank – Egypt, in addition to 11 banks with Islamic branches besides their traditional branches.
According to EIFA, the Faisal Islamic Bank of Egypt ranks first, with a volume of EGP 119bn. It accounted for about 31.4% of the volume of the Islamic banking industry in the Egyptian market. In second place was Banque Misr’s Islamic Banking segment, with a business volume of EGP 78.7bn, or 20.8% of the market.
Meanwhile, the Abu Dhabi Islamic Bank Egypt (ADIB) occupies third place, with a volume of EGP 76.8bn, or 20.8%. Al Baraka Bank Egypt ranks fourth, with a turnover of EGP 76.5bn, or 20.2% of the volume of Islamic banking in the Egyptian market.
Moreover, EIFA revealed that the volume of deposits compliant with Islamic law reached about EGP 313.5bn at the end of March. This represents about 7.2% of the total volume of deposits with Egyptian banks as a whole, an increase of EGP 32.1bn, and a growth rate of 11.4%, compared to March 2020.
On the other hand, the volume of financing in Islamic formulas amounted to about EGP 297.7bn, equivalent to about 5.7% of the total loans in banks. This reflected an increase of EGP 49bn, and a growth rate of 20% compared to March 2020.
According to the association, the number of Islamic branches in Egyptian banks currently stands at 243, constituting about 5.5% of the total number of branches in the Egyptian banking market. They provide their services to about 3 million customers.
It is noteworthy that the volume of the Islamic banking industry worldwide reached about $3trn in 2021, according to a report by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI).
It is expected to reach about $3.2trn in 2022. The Egyptian market has witnessed the development of many Islamic banking products that meet the various needs of customers, which amount to about 45 banking products and services.
The market still needs to develop and innovate many Sharia-compliant products, whether for individuals or companies.
This also requires training and developing of human resources capable of providing these products to customers.
The AAOIFI is working to provide this, in terms of professional qualifications in Islamic finance issued by the General Council of Islamic Banks and Financial Institutions (CIBAFI), and certificates issued by AAOIFI.
These developments also include programmes specialised in developing skills and increasing the knowledge of Islamic banking employees.— Daily News Egypt