Islamic banks' DPK higher than conventional banks: Finance Minister

Islamic banks' DPK higher than conventional banks: Finance Minister

Finance Minister Sri Mulyani Indrawati attends the signing of the virtual Memorandum of Agreement (MoA) on the Strategic Sharia Banking Management (SSBM) Program on Wednesday (September 22, 2021). (ANTARA/Agatha Olivia/uyu)

An excellent organization is usually supported by good governance.
Jakarta (ANTARA) - Third-party funding (DPK) in Islamic banking grew 16.54 percent in the second quarter of 2021, which was higher than the growth in the conventional banking sector’s DPK, Finance Minister Sri Mulyani Indrawati has said.

"It illustrates that there are real developments and dynamics," she noted at the virtual signing of a Memorandum of Agreement (MoA) on the Strategic Sharia Banking Management (SSBM) Program, accessed from here on Wednesday.

These developments and dynamics have helped Islamic banking survive and improve even amid the crisis caused by the COVID-19 pandemic, she said.

In addition, the Islamic banking sector’s assets also experienced a significant increase of 15.8 percent year on year during the second quarter, Indrawati informed.

Related news: Islamic banking grew faster than conventional banking amid pandemic

Still, the market share of the banking sector only reached 6.59 percent, which was lower than that of the conventional banking sector, she noted.

"However, it means that the prospect of Islamic banking growth will be enormous in the future," she remarked.

Hence, Islamic banking needs to ensure high competitiveness to optimize the huge opportunities in the banking industry, the minister said.

The resilience and competitiveness of the banking industry can be assessed from the efficiency of its organizational structure and quality of human resources, she added.

Thus, Islamic banking actors should pay high attention to both areas, Indrawati said.

Furthermore, she said she believes that Indonesia’s economy can be improved to create common prosperity and equity only through excellent organization and human resources.

"An excellent organization is usually supported by good governance, which uses true Islamic principles comprising honesty, justice, and integrity without any deception or exploitation," she added.

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