Piety, Profit and Politics: The Contemporary Evolution of Islamic Banking in Malaysia

Abstract

Recently, Islamic Banking has experienced exponential growth that has transformed the Malaysian finance sector. Record inflows of capital from both Muslim and non-Muslim sources alike have brought Malaysia to the forefront of Islamic financial providers. With 2004 estimates placing total Islamic assets at RM85.2 billion, or 10% of the total banking sector in Malaysia, the shape and impact of Islamic Banking and Finance will inevitably play a role in the development of the economic, political and social landscapes of the Federation. With this in mind, this thesis examines the growth of Islamic Banking in Malaysia from a religious, fiscal, and political perspective, seeking both to explain the current position of the sector in the Federation as well as its relationship with contemporary social discourse in the country.