Malaysia, UAE partner to boost Islamic finance

Central banks sign an agreement to this effect.

Bank Negara Malaysia and the Central Bank of the United Arab Emirates have signed a memorandum of understanding to foster closer economic ties, including Islamic finance.

Both central banks are key supporters of the Malaysia-based International Islamic Liquidity Management Corporation, an institution tasked with addressing a shortage of interbank lending products for Islamic banks.

The MOU signals stronger cooperation between Malaysia and the UAE, which together held a combined US$181 billion in Sharia-compliant banking assets in 2011.

The global Islamic banking industry is expected to reach US$1.3 trillion by the end of 2013.