In 2024, Egypt’s Islamic banking sector reached EGP 1.14 trillion, representing 5% of the total banking market with a 68% growth rate since December 2023. The sector comprises 15 licensed banks, 4 of which specialize exclusively in Islamic finance. The number of Islamic banking branches rose to 311, serving nearly 4 million customers. Leading banks, ADIB and Faisal Islamic Bank, accounted for substantial market shares, while Islamic deposits and financing also experienced significant growth. Overall, the market is evolving, with added emphasis on innovation and diversification.
In 2024, the Islamic banking sector in Egypt achieved a remarkable total of EGP 1.14 trillion, constituting about 5% of the overall banking market, as reported by Mohamed El-Beltagy, Chairperson of the Egyptian Islamic Finance Association (EIFA). This figure indicates a growth of EGP 412 billion, reflecting a significant 68% increase compared to December 2023.
The Central Bank of Egypt (CBE) has licensed 15 banks to offer Islamic banking services, with four operating solely under Islamic finance principles: Faisal Islamic Bank of Egypt, Al Baraka Bank Egypt, Abu Dhabi Islamic Bank – Egypt (ADIB), and Kuwait Finance House. Additionally, 11 conventional banks provide Islamic services through specialized branches, contributing to the sector’s growth.
In 2024, there are now 311 Islamic banking branches across Egypt, an increase of 51 branches from the previous year, catering to nearly 4 million customers. Some conventional banks also incorporate Sharia-compliant services throughout their entire branch network, demonstrating the expanding reach of Islamic banking.
ADIB leads the Egyptian Islamic banking market with a business volume of EGP 258 billion, holding 24.5% of the market share and achieving a 62% growth rate since 2023. Faisal Islamic Bank follows closely with EGP 240 billion, representing 23.6% of the market. Banque Misr’s Islamic Transactions Unit ranks third, securing EGP 195 billion at 19% of the market, while Al Baraka Bank Egypt and The United Bank complete the top five institutions.
Islamic deposits reached EGP 738 billion, accounting for 7.3% of the total banking deposits, reflecting a growth of EGP 290 billion, or 65% year-over-year. Sharia-compliant financing has also seen a rise, achieving EGP 807 billion, which accounts for 6% of the entire loan portfolio in the banking sector. The total increase in financing illustrates a 64% growth rate over the past year.
The Egyptian Islamic banking landscape continues to evolve with over 65 available Sharia-compliant financial products, including various savings plans, financing structures, and investment offerings. El-Beltagy emphasizes the necessity for ongoing innovation within Islamic financial solutions across various sectors such as personal, corporate, public sector, and SME banking.
The Sukuk market has also expanded, with total issuances amounting to EGP 100 billion, reflecting an upsurge in investor interest in these Sharia-compliant instruments. The industry has seen the emergence of 17 Islamic investment funds, seven Takaful (Islamic insurance) firms, and two real estate financing companies operating under Sharia principles, showcasing growth in various related sectors.
The Islamic banking sector in Egypt continues to grow remarkably, achieving significant milestones in both deposits and financing. The expansion of Islamic banking products and services, along with increased numbers of branches and market players, indicates a robust and dynamic financial environment. Furthermore, the Sukuk market and the emergence of related sectors underscore the potential for continued growth and diversification in this sector. As industry leaders foresee future developments, it becomes evident that Islamic banking can play a pivotal role in fostering financial inclusion and contributing to economic growth in Egypt.
Original Source: www.dailynewsegypt.com
