Islamic Finance Development Report and Indicator (IFDI) 2017 sees Islamic finance play a larger role in sustaining economic growth The IFDI global average value, which acts as a barometer of the overall industry’s development, recovered to 9.9 in 2017 from 8.8 in 2016 MANAMA, Bahrain, December 5, 2017/APO Group/ -- Thomson Reuters (www.ThomsonReuters.com) – the world's leading provider of intelligent information for businesses and professionals – and the Islamic Corporation for the Development of the Private Sector (ICD) (www.ICD-ps.org) – the private sector development arm of the Islamic Development Bank (IDB) (www.IsDB-pilot.org) – today released the key findings of the fifth edition of the Islamic Finance Development Report and Indicator (IFDI) at the World Islamic Banking conference (WIBC) 2017 held in Bahrain. The report studied key trends across five indicators used to measure the development of the US$2.2 trillion Islamic finance industry which are: Quantitative Development, Knowledge, Governance, Corporate Social Responsibility and Awareness. It also compiled extensive statistics on the industry from 131 countries and highlighted the best-performing countries within each key area of performance. The IFDI global average value, which acts as a barometer of the overall industry’s development, recovered to 9.9 in 2017 from 8.8 in 2016. This reflected improved performances in each of the five indicators. Malaysia, Bahrain and the UAE lead the IFDI country rankings for the fifth consecutive year, while the GCC remains the leading regional hub for the industry. Countries in the Commonwealth of Independent States (CIS), Europe, East and West Africa saw notable improvements in their IFDI values, demonstrating the continued growth of Islamic finance in non-core markets. The report also highlights how Islamic finance can help countries adapt to difficult economic conditions. Nadim Najjar, Managing Director of Thomson Reuters in the Middle East and North Africa, said: “We have seen that the Islamic finance industry can serve as a strategic tool for policymakers for sustainable growth in order to cope with the aftermath of the economic slowdown that impacted markets such as the Middle East. Some markets had noteworthy improvements in their IFDI values when they have improved or introduced Islamic finance to fit their economic needs and attract investments like Morocco, Tunisia and Iraq.” Khaled Al Aboodi, CEO of ICD, said: “Incorporating Islamic finance in different strategies can be seen in the many steps taken by governments across different IFDI indicators. This was noticed when some authorities intervened in Islamic social funds management, raised literacy in the industry among potential market players through formal education systems, organized roadshows targeting potential market players, or built a roadmap to plot development of the overall industry.” Islamic finance sector recovers strength and assets continue to grow Quantitative Development, which measures the performance of Islamic financial institutions and capital markets, advanced the most of the five indicators as a partial recovery in oil prices helped Islamic financial institutions and mutual funds regain strength. Sukuk grew least of the Islamic finance sectors as some large sovereign issuers resorted to conventional bonds to ease the issuance process and lower costs. Yet even here, sukuk showed signs of promise as new players came to market and Saudi Arabia emerged as a new sovereign sukuk giant. There was also an increase in consolidation within the industry. Mergers were agreed between Islamic financial institutions in the GCC, Pakistan, Indonesia and Malaysia that are likely to strengthen their competitive edge. The reversion to strength after last year’s oil price-led downturn saw total Islamic finance industry assets rise 7% to US$ 2.2 trillion in 2016 and it is expected that assets will continue to rise, to US$ 3.8 trillion by 2022. Governments looking to improve Islamic finance education and literacy The Knowledge indicator, which encompasses education and research, also edged higher in the latest report. There were 677 Islamic finance education providers in 2016, of which 191 provided a total of 322 Islamic finance degrees. Governments in Bahrain, Malaysia and Indonesia made particular efforts to push Islamic finance education and literacy. Governments improving regulatory regimes to encourage industry As governments sought to push Islamic finance to help revive economies hit by the fall in oil prices, Governance gained the most of the five indicators. Each of its Regulation, Shariah Governance and Corporate Governance sub-indicators showed improvement. The number of Shariah scholars increased, and several countries began to push for external Shariah scholars and centralized Shariah boards. There were 44 countries in 2016 with specific Islamic finance regulations. Many of these pushed for takaful regulations or tax concessions for sukuk. Corporate social responsibility another strong gainer, though disclosure still too low The indicator for Corporate Social Responsibility (CSR) was another strong gainer, with improvements in both performance and disclosure by Islamic financial institutions. The total CSR funds disbursed by different Islamic financial intuitions increased 18% over the year, to US$ 683 million. The number of institutions reporting CSR activities also increased, but the global average for reporting disclosure remains low. Despite this, there are developments that will contribute to a stronger CSR in the future including interventions in managing zakat, waqf and charity by the governments of the UAE, Malaysia and Indonesia. Conferences and seminars exploring mutual values of Islamic and ethical finance As governments turned their attention towards Islamic social financing, a growing number of conferences and seminars explored the common ground between Islamic and ethical finance, particularly in Europe. This helped the Awareness indicator to edge higher, despite a slowdown in growth of news articles on the industry. Other popular themes of conferences and seminars included socially responsible investing, sukuk, and microfinance. The rise in number of Islamic microfinance events was particularly noticeable in Africa. To learn more about IFDI 2017 and to download the ICD Thomson Reuters Islamic Finance Development Report, please visit http://bit.ly/IFDI2017 Distributed by APO Group on behalf of Islamic Corporation for the Development of the Private Sector (ICD).Contacts Tarek S. Fleihan Head, Corporate Communications & Public Relation     Middle East, Africa & Russia / CIS     Thomson Reuters                     Phone: +971 4 4536527     Fax: +971 4 3918333     Email: Tarek.Fleihan@ThomsonReuters.com Website: www.ThomsonReuters.com                     Building No. 1, Office 501 P.O. Box: 1426, Dubai Media City, Dubai, UAE ICD Thomson Reuters Islamic Finance Development Indicator Background The ICD Thomson Reuters Islamic Finance Development Indicator is a composite weighted-index that measures the overall development of the Islamic Finance industry by providing an aggregate assessment of the performance of all its parts, in line with the objectives of Islamic principles. It is a global level composite indicator with country and unit specific level indicators. The composite indicator is released annually, featuring a full report detailing each country and unit specific level indicator and their raw numbers. Each indicator within the composite indicator's constituents will be equally weighted and aggregated, i.e. all variables are given the same weight. In addition, normalization is required prior to any data aggregation as the variable indicators in a data set have different measurement units. For the Country Composite Indicator level, country indicators are normalized to allow for meaningful comparisons over time for a given country and between countries. Various economic indicators (e.g. population size) will be considered while measuring the health of the Islamic finance industry in each country. To learn more about the indicator, please visit http://APO.af/61bZbE About Thomson Reuters Thomson Reuters (www.ThomsonReuters.com) is the world’s leading source of news and information for professional markets. Our customers rely on us to deliver the intelligence, technology and expertise they need to find trusted answers. The business has operated in more than 100 countries for more than 100 years. Thomson Reuters shares are listed on the Toronto and New York Stock Exchanges. For more information, visit www.ThomsonReuters.com. About ICD The Islamic Corporation for the Development of the Private Sector (ICD) (www.ICD-ps.org) is a multilateral organization and a member of the Islamic Development Bank (IDB) Group. The mandate of ICD is to support economic development and promote the development of the private sector in its member countries through providing financing facilities and/or investments, which are in accordance with the principles of Shari’ah. ICD also provides advice to governments and private organizations to encourage the establishment, expansion and modernization of private enterprises. ICD is rated AA/F1+ by Fitch and Aa3/P1 by Moody’s. For more information visit www.ICD-ps.org