The nonperforming ratio of Islamic banks' retail financing has been catching up with that of conventional banks' retail loans over the past two years, the latest data from Malaysia's central bank, Bank Negara Malaysia (BNM) shows. While the deterioration is modest, this credit negative trend is driven by higher delinquencies in the affordable housing sector. We expect the nonperforming ratio of Islamic banks' retail financing to continue edging up over the next 12 to 18 months, as imminent reform of....