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The year 2012 up to the third quarter of 2012 i.e. as of September 2012 signified the slowing down of the growth of Indonesian Islamic banking sector. Although we have yet to see the figures in the last quarter of 2012 to take any definite conclusion, it is safe to say that the 2012 growth of Indonesian Islamic Banking sector has been considerably slower compared to its 2011 growth. In order, to make the Islamic banking sector more significant in Indonesia and increase its share beyond 5% of total banking industry (it is still around 4% to-date), consistent high growth is still needed. However, what really needs to be addressed is the reason behind the slowdown growth.

By Farouk Abdullah Alwyni

Islamic Finance News