In fact, the Islamic finance industry in South Africa is in good shape with most institutions delivering consistent double-digit growth despite trying economic conditions, First National Bank said on Tuesday.
The industry is witnessing new entrants from various financial disciplines, not just from the banking sector but also insurance and asset management, said Amman Muhammad, CEO of FNB Islamic Banking South Africa.
Muhammad said the Islamic finance sector had established itself as a serious player, with the government issuing the first draft of an amendment to taxation laws during May 2010 which went on to become officially recognised with the provision and inclusion of Islamic financial transactions in legislation for the first time ever.
“The South African Islamic market can now comfortably categorise itself as an emerging Islamic financial market as opposed to being just a potential market,” Muhammad said.
He said plans were afoot for the return of the country to the Islamic debt capital market, with an eagerly anticipated local currency sukuk (bond), five years following the maiden US$500 million sukuk issuance in 2014.
“The market is expecting more news from the National Treasury clarifying the specific details regarding this issue,” Muhammad said.