Retail, consumer banking, SME commercial banking and investment banking are the areas where Islamic banking sector would continue to see growth this year, said Moinuddin Malim, Chief Executive Officer, Mashreq Al Islami, told Emirates Business.
Innovation and exploring the untapped segments are expected to be a focus area in the Islamic finance sector which continues to grow in 2010. There would be a greater push towards finding other areas such as fund management, said Samad Sirohey, Chief Executive Officer of Citi Islamic Investment Bank. "In Islamic finance, which should grow now, there would be a push towards other areas such as fund management. It is still not a big industry but is expected to attract greater focus. Institutions could be looking at managing money on Shariah compliant basis, not necessarily through bank structure but also through fund managers."
In terms of products, Sirohey said growth can be expected both within the existing framework and outside "what is conventionally considered to be market products. That is where innovation will take place".
Overall, Malim said, it would be how the finance and banking industry itself would grow.
"From that perspective, there are pockets from where growth would come, you won't probably see growth in all segments. For instance, you may not see much activity in the IPO market until end of the year or investment banking may not be as aggressive it was in 2006-2007. Having said that I think the financial markets have returned to their basics. The basics are the core building blocks of the industry which are coming back to consumer-based lending models, back to cash flow- based financing for SME and corporate and commercial banking. In that segment, both Islamic and conventional banking would compete effectively."