This article first appeared in The Edge Financial Daily on September 6, 2017

KUALA LUMPUR: Maybank Islamic Bhd expects its financing assets to grow 8% in 2017, driven by demand for consumer-related financing products, growing interest from small and medium enterprises, and pickup in corporate and investment banking activities, said chief executive officer Datuk Mohamed Rafique Merican Mohd Wahiduddin Merican.

However, Mohamed Rafique Merican said Maybank Islamic’s financing growth forecast this year is lower than the 14% it recorded last year, which “outperformed” the average industry growth of 11% in that year.

“We still need to see broad-based growth across all industries. When it comes to growth, it will not be as widespread as [those] we have seen in the past but with the recent acceleration in economic growth number, perhaps the momentum will start to pick up,” Mohamed Rafique Merican told reporters yesterday.

He was speaking after opening the Islamic Banking and Finance Media Workshop 2.0, organised by the National Press Club Malaysia in collaboration with Maybank Islamic.

Despite the anticipated dip in the lender’s financing growth this year, he points out the country’s Islamic banking institutions have been growing at a “phenomenal rate” in the last five years, double the growth recorded by the conventional banking institutions.

From December 2011 to March 2017, Maybank Islamic’s total assets grew at a compound annual growth rate of 18% to RM181.5 billion, making it the fifth-largest syariah-compliant lender in the world.

“The strong growth of syariah-compliant financing assets is due to strong demand from various segments for syariah-compliant products, as well as the enabling environment.

“If any banking institution can chalk financing assets growth that exceeds 8% this year, it is considered very good, given today’s tough operating environment.”

Going forward, Mohamed Rafique Merican said Maybank Islamic sees opportunities in “largely unmet potential and unaddressed demand” in areas including Islamic wealth management, infrastructure sukuk, syariah-compliant pensions, social financing and sustainable development.

Currently, Maybank Islamic commands slightly over a third of the country’s syariah-compliant financing segment. It contributes around 56% of its parent company Malayan Banking Bhd’s (Maybank) total loans and financing.

Shares in Maybank — Malaysia’s largest bank by market capitalisation — slid four sen to RM9.42 yesterday, with a market capitalisation of RM99.55 billion.