| The Malaysian Islamic banking system (MIBS) achieved an encouraging thumbs up in 2010 underlining both the resilience of the industry and its sustained recovery. The latest Financial Stability Report 2010, which is published with the central bank's annual report and was released last week, confirmed that the MIBS "continued to remain resilient throughout 2010 supported by high capitalization, with a risk-weighted capital ratio (RWCR) of 14.9% and an improvement in asset quality with NPL pegged at 2% in an environment of ample liquidity and improved economic conditions." In terms of profitability, Islamic banking institutions registered a steady and sustained income, thereby improving returns on assets and equity. Total income year-on-year increased from RM9.71 billion in 2009 to RM11.80 billion at Dec. 31, 2010. Similarly, Net income (profit) increased from RM6.10 billion in 2009 to RM6.84 billion at end 2010. The encouraging profitability has enabled Islamic banking institutions to provide competitive returns to their depositors, thus enabling Islamic banking institutions to continue to attract additional deposits. Indeed, total deposits in the MIBS increased from RM235.94 billion to RM277.55 billion for the same period. |
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