The Islamic banking and finance today has emerged as an important component of the overall Malaysian financial system that contributes to the growth and development of the Malaysian economy. Since year 2000, the domestic Islamic banking industry has been growing at an average rate of 18% per annum in terms of assets. It is the aspiration of the Malaysian government to have a strong Islamic banking industry to capture a significant percent of the market shares of financing and deposits in the Malaysian financial industry. the of financing and deposits in the Malaysian financial industry.
The latest figure of market shares of Islamic deposits and financing stood at 11.7% and 1201% of the industry’s total respectively. In this regard, the ability of the Islamic banking industry to capture a significant market share in a rapidly evolving and challenging financial environment particularly in a dual-banking system like Malaysia, is dependent on the strategic positioning of the Islamic banking players to maintain their competitive edge and offer services and products that satisfy the needs of their customers. Against this backdrop, this book provides a comprehensive discussion of the fundamentals of Islamic banking operation.