Bahrain-based Al Baraka Bank is looking to deepen its footprint in Pakistan as the South Asian nation embraces interest-free Islamic banking.
The bank will open 15 new branches across Pakistan as a first step, Muhammad Atif Hanif, the bank’s chief executive officer in Pakistan, said in an interview.
“This is just first year and we expect a lot more strong expansion in years to come,” he said.
Islamic banking, based on Sharia law, does not offer interest but rather profit sharing as a return on investment.
The system has been growing in Pakistan since the Federal Shariat Court ruled in 2022 against interest-based banking in favor of an “equitable, asset-based, risk-sharing and interest-free” economy by December 2027.
Islamic banking has 23% of overall deposit share of the banking industry, according to the State Bank of Pakistan.
Under its five-year plan, Al Baraka is creating links between Pakistan and the bank’s existing ties to non-traditional markets in the Persian Gulf and Africa.
“They will get new markets and we, business.
Even those aren’t our clients will try to grab the opportunity,” Hanif said.— BNN Bloomberg
