Islamic finance offers reliable financing option, says head of Islamic Development Bank

By Gokhan Ergocun

RIYADH (AA) - Islamic finance offers a reliable financing option with its asset-based approach that mitigates risks, the head of the Islamic Development Bank (IsDB) Group said on Tuesday.

Speaking at the bank's annual meeting in the Saudi capital Riyadh, Mohammad Al Jasser said the Islamic finance sector is expected to reach a size of $5 trillion by 2025.

The Islamic finance industry has been has seen remarkable growth in recent years, expanding in size, liquidity, and sophistication, he said.

Sukuk is one of the fastest-growing asset classes within the Islamic finance industry, he stressed.

Sukuk is an Islamic financial certificate, similar to a bond in Western finance, which complies with Islamic religious law.

Last year alone, the sukuk market expanded 9.8%, reaching about $823 billion, he said, adding that as a leading player in the sector, the Islamic Development Bank sees immense potential and leveraging Islamic finance instruments to accelerate development.

"Unlocking the power of sukuk markets can significantly fuel infrastructure and climate finance initiatives," he added.