Brunei ranks 11th in Islamic finance, says report

Deputy Managing Director at Autoriti Monetari Brunei Darussalam, Hajah Noorrafidah Sulaiman. - Borneo Bulletin/ANN

BANDAR SERI BEGAWAN, June 4 (Borneo Bulletin/ANN): Brunei is ranked 11th among 135 other economies for Islamic Finance institutes, according to the ICD-Refinitiv Islamic Finance Development report.

ICD Refinitiv Islamic Finance Development Indicator is a composite weighted index that measures the overall development of the Islamic finance industry across more than 10 key metrics including knowledge, governance, CSR and awareness.

The country scored 36 points, in comparison to first place Malaysia with 111 points, Indonesia at 2nd place with 72 points and Bahrain at 67 points.

Deputy Managing Director at Autoriti Monetari Brunei Darussalam (AMBD) Hajah Noorrafidah Sulaiman said the report indicated that the regulatory landscape in the country is strong (governance at 51 points), while also ranking top five in awareness indicator and 2nd in conference indicator such as organising events such as the Brunei Mid-Year Conference and Exhibition (MYCE 2021).

She said the country’s Islamic finance sector experienced increased growth in market share over the total financial sector in terms of assets.

Islamic banks’ total assets is valued at BND11.4 billion compared to BND6.9 billion for conventional banks in the first quarter of 2020.

In the insurance/takaful sector, insurance companies continue to dominate. Takaful operators’ assets continue to grow at 6.2 per cent year on year, reaching BND595.7 million as at 2020.

For takaful, the Sultanate ranked first in countries with highest takaful assets to gross domestic product (GDP) in 2019, recording an impressive BND553 million or 1.12 per cent of GDP. For Islamic funds, local trends showed an increase in the total number of Islamic funds being offered, up by 30 per cent in 2020. This indicated a 61.6-per -cent average increase year-on-year in investor participation in investment funds, of which 20 per cent of the volume of investments are in Islamic funds.

Meanwhile for sukuk, since its initial offering of Brunei Government sukuk in 2006, the Brunei government has issued over BND14.3 billion worth of short-term Sukuk Al-Ijarah securities with BND225 million as of the first quarter of 2021.

Hajah Noorrafidah also said Brunei’s Islamic financial sector has also attained some special mention in the ICD-Refinitiv Report. For banking, Brunei was ranked top five Islamic banking asset share to total banking assets in 2019. - Borneo Bulletin/ANN