KUALA LUMPUR: RAM Ratings has maintained its stable outlook on the country’s Islamic banking industry as it expects the industry to stay resilient despite lingering risks from Covid-19, Bernama reported.

       In a statement yesterday, RAM said the industry is poised to continue leading efforts towards a wider adoption of value-based intermediation (VBI).

       “An increased focus on Islamic sustainable finance has created new opportunities, enabling banks to build on their existing value-based practices and solutions to strengthen the impact of VBI.

       “This puts Islamic banks in a good position to meet the requirements of Bank Negara’s Climate Risk Management and Scenario Analysis, effective June 1, 2022,” it said.

       Meanwhile, the rating agency said BNM will likely award at least one digital bank licence to an applicant with strong Islamic finance value proposition, affirming Malaysia’s role as an established global Islamic finance leader.

       “We do not, however, see digital banks posing a significant threat to domestic Islamic banking or the banking sector in general in the near to medium term,” it added.-- BERNAMA