Islamic financial assets increased by 20% in Qatar

Islamic financial assets in Qatar increased by 20% TO $172 billion in 2021, with Islamic banks accounting for 87% of these assets, followed by Islamic Sukuk (11.6%) and Takaful Insurance company (0.8%).

According to Bait Al Mashura Financial Consulting company and Islamic Financial Report 2021, the remaining share was distributed to investment funds and other Islamic financial institutions.

The company has released its fifth annual report on Islamic finance in Qatar which describes the results of the activities of Islamic financial institutions in 2021.

The report said the increase in Islamic financial assets in Qatar last year was primarily the result of an increase in the size of Islamic banks’ assets after the successful merger of Maslav al-Layan and Al-Hariji.

Islamic Banking Sector

In the Islamic banking sector, Qatar’s Islamic banking assets increased 12.6% to $139.36 billion as the deposits surged 17.5%. Private sector deposits accounted for 54% and financing increased by 8.7% to government sector, real estate, and personal finance. Islamic bank revenues also increased by 2.6%, profits reached about $2.06 billion and growth was 10.7%.

In the Takaful insurance sector, policyholder assets increased 4.4% to $630 million and premiums increased 7.4% to $380 million. Insurance surplus reached about $31.04 million, the report said.

Meanwhile, the assets of Islamic financial companies reached $690 million, showing a 3.6% decrease, and finance decreased by 8%. The revenue reached $60.42 million, showing a 9.2% decrease. Finances and investments make up 96% of total income.

The results of the Islamic financial company’s business differed between achieving a total profit of over $32.13 million and incurring a loss of approximately $1.92 million.

Islamic Sukuk

The report also said that in the field of Islamic sukuk, with the resumption of Qatar Central Bank (QCB) issuing government sukuk, issuing sukuk (government and Islamic bank sukuk) reached $2.85 billion and the growth rate was 30.2%, of which the government issued sukuk. It accounted for 73.7% of the total sukuk that was made.

According to available data on Islamic investment funds, the assets of these funds reached $236.75 million with a growth rate of 5.8% and performance in 2021 was uneven.

On the Qatar Stock Exchange, the Al Rayan Islamic Index achieved positive performance, closing with a 10.48% increase. Qatar’s Islamic financial companies performed well in 2021, with annual gross profit on Islamic stocks ranging from 1.8% to 89.7%.

High Demand

According to Dr Khalidbin Ibrahim Al Sulaiti (pictured), Vice Chairman of Bait Al Mashura Finance Consultations, Qatar’s demand for Islamic financial products and services is high locally and globally.

He added: “We are proud to be involved in the Islamic financial process in Qatar and around the world, to our community, and to all researchers and the Islamic financial sector in Qatar. Knowledge and expert support for the Islamic financial industry to serve interested people. “

Al Sulaiti also emphasized that Islamic finance has emerged as a corrective and developmental idea to tackle the problem of money and its development within the framework of a favorable Shariah environment.

He added that the report showed that economic recovery would differ around the world due to the emergence of COVID-19, rising inflation, and the continuation of some of the effects of the pandemic.

“In Qatar, preventative and economic measures, the spread of vaccines to the population, and improved demand for oil and gas have led to a rapid recovery in the economic sector and a resumption of economic growth,” he added.