At a time when deposit growth of conventional banks has almost stagnated, Islamic banks are enjoying handsome growth in deposits, indicating increasing preference to Islamic banking in the country.
According to latest data, deposits of Islamic banks rose by Rs 31 billion or 18 percent to Rs 202 billion at the end of second quarter of current fiscal year (Oct-Dec 2008) from Rs 171 billion at the end of first quarter (Jul-Sep 2008).
It is pertinent to mention here that deposits of overall banking industry rose by Rs 20 billion or 0.52 percent to Rs 3.801 trillion from Rs 3.781 trillion during the quarter under review. This means that there was negative growth in deposits of conventional banks during the quarter and the growth in overall banking industry’s deposit base came only from Islamic banks.
There was a phenomenal growth of 40 percent in the number of branches of Islamic banks during the quarter. Islamic banks had 514 branches at the end of December 2008, an increase of 147 branches from 367 branches at the end of September 2008. Five years ago-at the end of 2003-Islamic banks had only 17 branches.