Investments with Islamic banking soar 19 per cent

Investments with the Islamic banking accounts have increased by 19.03 per cent in the October-December quarter of 2017, compared to the corresponding period of the previous year.
"The Islamic banking segment continued to show rapid expansion in terms of growth of assets, deposits, investments and number of account holders," a Bangladesh Bank (BB) senior official told BSS on Sunday.
According to the latest BB data, total investments (loans in conventional sense) in Islamic banking sector stood at over Tk 2.011 trillion at the end of October-December 2017 quarter, up 4.07 per cent from the previous quarter.
During the October-December period of 2017, total deposits in the banking industry stood at over Tk 2.142 trillion, up 5.03 per cent from the previous quarter and 14.15 per cent from the corresponding quarter of 2016.
The Investment-Deposit Ratio (credit-deposit ratio in conventional sense) reached 0.94 in October-December quarter, which was 0.95 in the previous quarter of 2017 and 0.90 at the end of December 2016.
The total remittances mobilised by the Islamic banking sector stood at Tk 110.70 billion at the end of October-December quarter, up 12.06 per cent from the previous quarter and 20.73 per cent from the same quarter of the previous year.
The number of branches of Islamic banking sector, including Islamic branches or windows of conventional commercial banks, stood at 1,168 at the end of the October-December quarter, which was 1,126 during the previous quarter and 1,050 during the same quarter of 2016.
An analysis of the sector-wise investments shows that the trade and business sector accounted for 28.93 per cent of total investments-the highest among all sectors-in the October-December quarter of 2017.
The next position was occupied by Micro Small and Medium Enterprises (MSME) sector (27.52 per cent), followed by industrial sector (25.29 per cent), others (7.80 per cent), real estate (6.50 per cent), agriculture (1.71 per cent), transportation (1.33 per cent), electricity, gas and water supply (0.82 per cent) and poverty alleviation (0.09 per cent).
Among the Islamic banks, Islami Bank Bangladesh Limited (IBBL) accounted for the biggest share of deposits and investments -- 35.08 per cent and 34.86 per cent respectively.
In the quarterly report, BB said Islamic banks should pay more attention to Research and Development (R&D) to work out proper guidelines and policies in order to promote investments under the mudaraba and musharaka modes.