The International Monetary Fund (IMF) has disclosed that the, Global Islamic financial assets have reached about $2 trillion, with the banking sector accounting for about 85 per cent of the total assets.
According to IMF annual report it was stated that, “The Islamic finance sector continues to grow and evolve in size and complexity, Islamic banking takes place in more than 60 countries, and the industry is now systemically important in 13 jurisdictions,”
It stressed the important opportunities the growth of Islamic finance presents to strengthen financial inclusion, deepen financial markets, and mobilize funding for development by offering new modes of finance and attracting unbanked populations that have not participated in the financial system.
Islamic banks undertake distinct operations with risk profiles and balance sheet structures that differ in important respects from those of conventional banks, with associated financial stability implications.
It noted that the Executive Board of IMF in May 2018, endorsed a proposal on the use of the Core Principles for Islamic Finance Regulation, which were developed by the Islamic Financial Services Board with the participation of the Secretariat of the Basel Committee on Banking Supervision.
“The core principles will complement the international architecture for financial stability while motivating improvement in the prudential framework for the Islamic banking industry across jurisdictions. The use of the core principles would help strengthen evenhandedness and consistency in surveillance, program design, and technical assistance,” the state added.