KUALA LUMPUR: The Islamic banking industry remains resilient, supported by strong capital and liquidity positions, amid uncertainties in the Middle East, says the Association of Islamic Banking and Financial Institutions Malaysia.
The association said that while Malaysia’s economic fundamentals remain sound, geopolitical tensions may have indirect spillover effects through higher energy prices, market volatility and potential disruptions to trade and supply chains.
“These could impact business costs, inflation, and cash flows for certain segments of the economy.
“The Islamic banking industry remains vigilant and ready to respond to these evolving risks,” it said in a statement yesterday.
The association said the industry continues to uphold the values of justice, compassion and social responsibility.
Furthermore, it added that players are also advancing value-based intermediation (VBI) to deliver sustainable and inclusive outcomes.
In 2024, Islamic financial institutions channelled RM148.6bil into VBI-aligned activities, including support for small and medium enterprises, green financing and social initiatives, reinforcing resilience in key sectors of the economy. — Bernama
