Bangladesh has ranked 8th in the Islamic Finance Country Index (IFCI) 2019, moving two notches up from the previous year's position.
The country scored 43.01 this year in the IFCI, according to the global ranking index on Islamic Banking and Finance (IBF) market.
The development in Islamic finance in Bangladesh is more comprehensive than other leading Muslim populated countries like Iran, Saudi Arabia and other important players in the Gulf Cooperation Council (GCC) region, according to the IFCI report.
Among the top countries in the IFCI index, Iran, Saudi Arabia, Malaysia, UAE witnessed a poor performance in the IBF market, when compared to their performance in the previous year.
Saudi Arabia saw a decrease of 6.01 points in its IFCI score, coming down to the 4th position from the 3rd.
Indonesia ranked first with 81.93 score, overtaking Malaysia that dominated the index since 2011. Indonesia has jumped 5 positions up to capture the top slot this year.
The previous holders of the top position were Iran and Malaysia. Prior to this year, Malaysia ranked the number one position for three years in a row, taking over from Iran in 2016.
There are over 70 countries involved in the IBF in some way or another. Nevertheless, the index was made on 48 countries.
Islamic banking industry of Bangladesh is experiencing an impressive growth due to strong public demand and supports from central bank as well as the government, the central bank said in its quarterly report for April-June titled Development of Islamic Banking in Bangladesh.
The Bangladesh Securities and Exchange Commission (BSEC) has recently issued the BSEC (Investment Sukuk) Rules, 2019 which will help Islamic banks manage liquidity as well as promote Sukuk-based Islamic capital market, the report said.
At the end of June 2019, Bangladesh's eight full-fledged Islamic banks are operating with 1,201 out of total 10,396 branches in the whole banking industry.
In addition, 19 Islamic banking branches of nine conventional commercial banks and 41 Islamic banking windows of seven conventional commercial banks are also providing Islamic financial services in Bangladesh.
At the end of the April-June 2019 quarter, deposits and investments grew by 4.52 percent and 3.33 percent respectively, while remittance and excess liquidity of Islamic banking industry increased by 16.49 percent and 58.08 percent respectively compared to the previous quarter.
Islamic banking industry holds almost one-fourth share of the entire banking industry in terms of deposits and investments, according to central bank report.