The global Islamic finance industry has spoken! With over 26,000 votes this year, the results for the illustrious IFN Best Banks Poll 2016 are finally in — and it is clear from the outcome that Islamic financial institutions worldwide are soldiering on amid a very trying year with many shocking and surprising turns politically and economically; at the same time, we saw the emergence of new winners, proving that innovation, determination and strategic thinking still make up the name of the game. VINEETA TAN takes us through the victors of the distinguished IFN Best Banks Awards as honored by their peers.
Despite massive turbulence in the global economic landscape which significantly impacted the performance of Islamic financial players worldwide, this year saw one of the best responses ever for the IFN Best Banks Poll with 26,507 votes from individuals all over the world cast. Preserving the quality and independence of the IFN Awards, this year’s screening process was ramped up employing greater due diligence and a stricter and more robust screening process.
In a year with many unprecedented and unexpected developments, from the UK deciding to leave the EU to the election of Donald Trump as the president of the US, in the backdrop of stubbornly low oil prices and sluggish global economic growth, many Islamic finance stalwarts have demonstrated great resilience in maintaining their grip on being number one amid stiffer competition as we welcome many familiar faces back to the league of winners. Yet concurrently, we also open our arms to greet many new names that have turned the tables and shaken the status quo of the industry with their stunning victories.
Central bank champions
Proving that a change in leadership did not and would not affect its solid performance nor dilute its strong commitment to Islamic finance, Bank Negara Malaysia (BNM) this year emerged triumphant in a very tight race as the Best Central Bank for Promoting Islamic Finance, displacing last year’s winner, the State Bank of Pakistan (SBP), to second place.
Caught in the regional wave of volatility which sent the Malaysian currency plunging to record low levels, BNM held its head up high and wasted no time mobilizing measures to bolster the financial community and nation’s economy. The departure of Dr Zeti Akhtar Aziz, one of the most respected central bankers of the world widely credited as an international champion of Islamic finance, in April may have caused some concerns over the future of Malaysia’s Shariah finance industry, but those doubts were soon silenced as her successor Muhammad Ibrahim, another strong advocate of Islamic finance, is proving his worth.
Inheriting a strong legacy, BNM in 2016 made fintech a top priority in driving the Islamic and conventional finance industry forward: it launched the Investment Account Platform – the world’s first Shariah compliant bank-mediated fintech platform and set up a fintech sandbox to catalyze the development of fintech. The central bank also focused on building international and regional partnerships, signing bilateral MoUs with another solid Islamic finance player, Indonesia and also Thailand.
The SBP came in as the runner-up in the central bank category, but only by a very small margin. Introducing a slew of supportive measures for the Islamic banking industry, including establishing four Islamic finance subcommittees to increase the sector’s reach and allowing Islamic banking branches of conventional banks to set up a separate Pakistan Real-Time Interbank Settlement Mechanism in a bid to optimize the efficiency of the financial services of the banking system, the Pakistani central bank is unwavering in its dedication to increase the market share of Islamic banks – the SBP is indeed deserving to be one of the top central banks in the world in promoting Islamic finance.
The strong support of these central banks are yielding positive results as Malaysian and Pakistani Islamic banks dominate the table of sector winners this year. Malaysian heavyweight CIMB Islamic Bank bagged multiple awards including Best Private Equity House for the second consecutive year and beating Qatar First Bank to the top by a comfortable margin. CIMB Islamic was the runner-up for the categories of Best Islamic Retail Bank (first time being recognized in this global category) and Best Islamic Bank for Treasury Management. CIMB Islamic also once again was voted as the Best Islamic Bank in Malaysia, demonstrating its strength both in the local and international markets. CIMB Islamic Trustees proved that it is the undisputed Best Islamic Trustee/Custodian of the year, winning it three times in a row; Malaysia’s AmanahRaya Trustees came in second.
In terms of treasury management, this year the industry voted Asian institutions to the top, changing last year’s GCC-focused dynamics. Pakistan’s Meezan Bank took home the crown as the Best Islamic Bank for Treasury Management by a large margin; together with runner-up CIMB Islamic, they both ousted Middle Eastern giants Abu Dhabi Islamic Bank (ADIB) and Al Rajhi Bank from the league. Voted as the Best Islamic Retail Bank in 2015, Meezan Bank also tied with ADIB as the runner-up for Most Innovative Islamic Bank.
“We are honored and humbled to receive this award. Our success is built on the foundation of hard work, persistence, creativity and goodwill; and we are confident in the abilities of our team and motivated to accomplish greater things,” commented Muhammad Abdullah Ahmed, Meezan Bank’s senior executive vice-president and head of treasury and financial institutions.
After coming in second in 2015, Dubai Islamic Bank (DIB) was crowned champion in the Most Innovative Islamic Bank category. DIB, with its customer-centric approach, also flexed its muscles running ahead of CIMB Islamic to clinch the title of Best Islamic Retail Bank.
The year 2016 witnessed massive shakeups across multiple sectors with new names to the fore: Islamic Finance House, based in the UAE, was voted as the Best Islamic Leasing Provider, a strong win in its IFN Best Banks Poll debut; while Sri Lanka’s Al-Falaah, the Islamic Business Unit of LOLC Finance, moved up the ranks from third place in 2015 to second place in 2016. It has indeed been a good year for Al-Falaah which has also been recognized as the second Best Islamic Bank in Sri Lanka.
Winning gold in the Best Islamic Private Bank category for the second consecutive year, ADIB continues to wow its customers by enhancing its offerings via expanding its product suite and upgrading its IT infrastructure. From third place, Maybank Islamic climbed the ladder this year, grabbing second place in this category.
Leading Islamic banks continue to hold their ground in the domestic landscape but 2016 has also unveiled surprising new winners, a sign of rising healthy competition.
In the Middle East, several countries saw the return of 2015’s victors asserting their dominance with their expansive network, innovative products and excellent customer service. These nations include Bahrain (Winner: Bahrain Islamic Bank; Runner-up: Al Baraka Islamic Bank), Oman (Winner: Meethaq Islamic Banking by Bank Muscat; Runner-up: Bank Nizwa), Saudi Arabia (Winner: Al Rajhi Bank; Runner-up: Arab National Bank), Qatar (Winner: Qatar Islamic Bank; Runner-up: Qatar International Islamic Bank), the UAE (Winner: DIB; Runner-up: ADIB), Palestine (Winner: Palestine Islamic Bank; Runner-up: Arab Islamic Bank), Syria (Winner: Syrian International Islamic Bank; Runner-up: Albaraka Bank Syria) and Yemen (Winner: Islamic Bank of Yemen; Runner-up: Saba Islamic Bank).
The status quo was nonetheless disrupted in other Gulf markets. In Kuwait, Al Rajhi Bank Kuwait for the first time made it to the top-two list – grabbing second place in the Best Islamic Bank in Kuwait category; but huge applause goes to winner Kuwait Finance House which, for the 12th year running (since the IFN Best Banks Poll was launched in 2005!), has been selected as Kuwait’s most premier Shariah bank by IFN readers worldwide. A record-breaking and outstanding achievement! Moving on to Lebanon: despite its national economy suffering from crises within and beyond its borders, Arab Finance House managed to pip former champion Al Baraka Lebanon to the post to win Best Islamic Bank in Lebanon. Bank Mellat is living up to its name as the ‘Bank of the Nation’ as it wins Best Islamic Bank in Iran, outstripping 2013 winner Bank Melli Iran by over 50% in votes. The Best Islamic Bank in Jordan award once again goes to Jordan Islamic Bank (JIB) which won by a comfortable margin over Islamic International Arab Bank which saw itself move up the polls from third place in the previous year.
Remarking on JIB’s win, CEO and General Manager Musa Shihadeh said: “It is my pleasure to receive the IFN Best Islamic Bank in Jordan for 2016 from Islamic Finance news, which is a recognition of our continued success in Islamic banking. We are proud of our bank for its accomplishments spanning over 35 years. JIB is committed to attaining the latest innovative products in the banking services industry and technology as well as looking forward to gaining the trust of the people in Jordan for our distinguished service.”
Flying off to Asia, we saw household names like Bank Muamalat Indonesia (Runner-up: Maybank Syariah) winning the Best Islamic Bank in Indonesia award again; and Bank Islam Brunei Darussalam (BIBD) in a landslide victory maintains its position as the Best Islamic Bank in Brunei (Runner-up: Maybank).
“It is a great honor to be receiving this accolade for being the best in Brunei Darussalam. We thank IFN for its commitment in together raising the profile of Islamic finance,” BIBD said.
In an extremely tight race – possibly the tightest we’ve ever seen! – CIMB Islamic managed to outdo Maybank Islamic (only by a hair’s breadth) to win Best Islamic Bank in Malaysia; and in Thailand, despite the great challenges faced by the Islamic Bank of Thailand in grabbing market share and turning profits, voters seem to be optimistic of the state-owned bank’s major overhaul and debt restructuring strategy, as they again voted it as the Best Islamic Bank in Thailand (Runner-up: CIMB).
Bank of Tokyo Mitsubishi UFJ takes home the title of Best Japanese Islamic Bank (Runner-up: Sumitomo-Mitsui Banking Corporation). Commenting on the bank’s win, Eiichi Yoshikawa, the senior managing executive officer and co-chief executive of the Global Business Unit, said: “MUFG’s core banking unit, the Bank of Tokyo-Mitsubishi UFJ, is delighted to be named as the winner of the Best Japanese Islamic Bank award. We are proud to be recognized by the Islamic finance industry for our achievements and capabilities in providing quality Islamic banking services. MUFG remains committed toward the Islamic banking Industry and will continue to offer a wider range of innovative products and services to its customers across geographies through its Islamic finance hubs in Malaysia and Dubai.”
The South Asian region is characterized by repeat victories – an encouraging trend testifying to the strength and dominance of these major players. Unsurprisingly, mammoth Islami Bank Bangladesh won again, for the 9th time, the Best Islamic Bank in Bangladesh award, far ahead of runner-up ICB Islamic Bank. In Pakistan, the country’s largest Islamic bank, Meezan, deservingly bagged the Best Islamic Bank in Pakistan award for the 10th time (Runner-up: Al Baraka Pakistan); while Amana Bank is awarded Best Islamic Bank in Sri Lanka for the sixth time (Runners-up: Muslim Commercial Bank – MCB Islamic Banking Division and LOLC Finance’s Al-Falaah).
“We are honored to be recognized as the global winner of Best Islamic Bank for Treasury Management by Islamic Finance news,” said Irfan Siddiqui, the founding president and CEO of Meezan Bank. “Our recognition as the Best Islamic Bank in Pakistan for over a decade also reflects on our commitment toward establishing Islamic banking as banking of first choice. It is the blessings of Allah, responsible deployment of our assets and resources and our strong commitment toward Shariah compliance that have enabled us to make positive contributions to the Islamic finance industry. We look forward to building on this momentum of delivering excellence to our clients as well as shareholders. Thank you for the trust you have bestowed upon us.”
Moving farther afield, there’s been a flip in standings as Muslim Community Co-Operative Australia overtakes Amanah Islamic Finance Australia as the Best Islamic Bank in Australia. Similarly in Turkey, Al Baraka Turk Katilim Bankasi, 2015’s runner-up, displaced Turkiye Finans Katilim Bankasi, which settled for second spot this year, to become the Best Islamic Bank in Turkey.
In any institution, a transition in power may present itself as a hiccup in operations; likewise 2016 was a year of major management changes for the Bank of London & The Middle East; however, the Islamic bank’s strong fundamentals and clear strategy continue to steer the bank to be honored as the Best Islamic Bank in the UK, a position it has been holding since 2009. Masraf Al Rayan again emerged as the runner-up.
The Best Islamic Bank in the US goes to Michigan-based University Islamic Financial (UIF). Delivering impressive results in 2016, UIF set a new record originating over US$200 million of financings in the third quarter and passed the US$1 billion of financings threshold since inception.
“UIF is honored to receive the Best Islamic Bank in the US award two years in a row. It is humbling to see our hard work and dedication pay off with such a meaningful recognition. UIF has become the fastest-growing Islamic financing institution in the US by offering our Muslim community strong Shariah compliant products, competitive monthly payments and superior customer service. We will not take this award for granted and will continue to build on our core values that have made us No 1 yet again,” shared UIF. This year, IFN welcomes runner-up Guidance Residential to the list of top US Islamic banks for the first time, which beat mainstays Lariba and Devon Bank in the polls.
Zooming into Africa, the Al Baraka brand continues to exert its presence in all corners of the world: Al Baraka Bank Sudan adds yet another trophy (fifth) to its collection this year as Best Islamic Bank in Sudan (Runner-up Arab Sudanese Bank appears on the list for the first time); the Egyptian arm of Al Baraka wins Best Islamic Bank in Egypt again (Runner-up: Faisal Islamic Bank of Egypt) and Al Baraka also steals the show in South Africa with yet another consecutive win (Runner-up: FNB Islamic Finance). In Kenya, Gulf African Bank leapfrogged from third place to first as Best Islamic Bank in Kenya (Runner-up: First Community Bank).
Best Islamic Bank by Sector
Best Overall Islamic Bank
1st: Dubai Islamic Bank* 2nd: CIMB Islamic ; 3rd: Abu Dhabi Islamic Bank
Best Central Bank in Promoting Islamic Finance
1st: Bank Negara Malaysia 2nd: State Bank of Pakistan
Best Islamic Leasing Provider
1st: Islamic Finance House 2nd: Al-Falaah, Islamic Business Unit of LOLC Finance
Best Islamic Private Bank
1st: Abu Dhabi Islamic Bank* 2nd: Maybank Islamic
Best Islamic Retail Bank
1st: Dubai Islamic Bank 2nd: CIMB Islamic
Most Innovative Islamic Bank
1st: Dubai Islamic Bank 2nd: Abu Dhabi Islamic Bank & Meezan Bank
Best Islamic Trustee/Custodian
1st: CIMB Islamic Trustee* 2nd: AmanahRaya Trustees
Best Islamic Bank for Treasury Management
1st: Meezan Bank 2nd: CIMB Islamic
Best Private Equity House
1st: CIMB Islamic* 2nd: Qatar First Bank*
Note: Red, Bold: winner; * Repeat winner
Best of the best
And finally, saving the best for last, in one fell swoop, this bank once again proves its worth, even more so during a year flooded with uncertainty and economic headwinds as it goes on to win multiple awards across different categories, illustrating its enviable strength as an issuer, investor and retail player. The IFN’s 2016 Best Overall Islamic Bank award goes to Dubai Islamic Bank (DIB) yet again! Winning the title for the second consecutive year, DIB’s 2016 IFN Awards stable also includes Best Retail Islamic Bank, Most Innovative Islamic Bank and Best Islamic Bank in the UAE.
Dr Adnan Chilwan, Group CEO of DIB, said: “Winning these awards is a source of tremendous inspiration and encouragement for us. The bank has shown its true mantle over the last few years, producing some of its finest financial results in times that were undoubtedly challenging. Our relationship with all stakeholders including customers and shareholders grows stronger each year and it is the strength of this partnership focused around mutual benefits and progression that has positioned us to play a leadership role in the development of Islamic banking and finance, locally here in the UAE and internationally in key markets around the world.” An extremely well-deserved win and IFN extends its heartiest congratulations to this global Islamic finance pioneer! Congratulations are also in order for runner-up CIMB Islamic and second runner-up Abu Dhabi Islamic Bank for this coveted accolade.
It is indeed a privilege to honor all the winners of the IFN Best Banks Poll 2016, which have showcased great fortitude, creativity and strength the past tumultuous 12 months with each leaving an indelible mark on the global Islamic finance and banking landscape – we thank and commend you for your excellent service and performance and are proud to recognize your contributions.