STAR BUSINESS REPORT

Deposits in Islamic banks in Bangladesh have shown fluctuations in recent months, according to the latest data from the Bangladesh Bank.

Islamic banking deposits, which peaked at Tk 440,427 crore in June 2024, have declined in subsequent months, reaching Tk 432,937 crore in October -- a 0.31 percent drop from September.

Despite a brief increase in September, when deposits rose by 0.57 percent, the overall trend suggests a slowdown in deposit growth.

A breakdown of the data reveals that full-fledged Islamic banks hold the majority of deposits, standing at Tk 386,314 crore in October, followed by Islamic banking branches of conventional banks with Tk 27,438 crore and Islamic banking windows with Tk 19,184 crore.

Deposits in Islamic banking windows saw the highest growth among segments, increasing by 3.55 percent in October.

Islamic banking, which operates on interest-free principles, accounts for approximately 23.10 percent of total banking deposits in Bangladesh. The sector has expanded significantly in recent years, with conventional banks also offering Islamic banking services.

In addition to deposits, investments in Islamic banking have followed an upward trend, reaching Tk 518,438 crore in October, marking a 0.29 percent rise from September.

Investment growth in the sector has been supported by demand for Shariah-compliant financial instruments, including Murabaha and Ijarah-based financing.

The Bangladesh Bank has introduced measures such as the Islamic Bank Liquidity Facility (IBLF) and the Mudarabah Liquidity Support (MLS) to ease liquidity pressures in the sector.