The Islamic finance sector is set to continue growing in 2022 as the accelerating economic recovery, particularly in the GCC region, brightens the outlook for credit growth despite challenges from a rise in interest rates and decline in sukuk issuance amid higher oil prices, Moody’s Investors Service said.
Islamic banks’ asset growth globally will also continue to outperform their conventional peers this year, the ratings agency said in a report. Strong fundamentals are also expected to drive expansion of assets under management for the Islamic funds industry.
However, sukuk issuance, which reduced in 2021, is expected to decline further in 2022. “The economic recovery in key Islamic finance markets will boost credit growth and demand for Shariah-compliant products and we expect Islamic banks’ asset growth to continue to outperform their conventional peers,” said Ashraf Madani, a vice president at Moody’s.—The National
