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@ Halal | May-June. 2026
Banking for sustainability
• Islamic finance remains underutilised in sustainable lending despite strong alignment with ESG and sustainability principles.
• Southeast Asia faces a major climate finance gap, creating opportunities for Islamic finance to play a larger role in funding
sustainable infrastructure and inclusive growth.
• Emirates Islamic launches UAE’ s first Shariah-compliant Certificate of Deposit programme and expanding Islamic liquidity solutions globally.
ONLY a small percentage of sustainable loans today are Shariah-compliant, despite Islamic finance encompassing around US $ 2.8 trillion in assets globally. Yet for Maybank’ s chief sustainability officer, Datuk Shahril Azuar Jimin, the gap between Islamic finance and sustainability should not be difficult to close.
He believes the foundations of both systems are already closely aligned.
“ Islamic finance emphasises social justice, welfare, and harm avoidance, which align naturally with ESG and sustainability,” he said.
Financial institutions across Southeast Asia and the Middle East are steadily expanding their Islamic banking offerings to meet growing demand from Muslim consumers and businesses.
Maybank, which operates across markets including Malaysia, Indonesia, Singapore, London and the Middle East, offers services ranging from Islamic deposits to Wasiat( Islamic legacy planning),
Shahril Azuar Jimin( Image: Fortune)
reflecting broader efforts to integrate faith-based financial solutions into mainstream banking.
Momentum is also building globally. According to a 2025 World Bank report, sustainable financing raised across the 57 countries of the Organization of Islamic Cooperation grew from US $ 17.8 billion in 2017 to US $ 82.3 billion in 2024.
A PERSISTENT GAP
Despite this progress, Islamic sustainable finance remains a small share of both global Islamic banking and wider green finance markets. The World Bank reported that only 8.2 per cent of sustainable loans issued between 2017 and 2021 were shariacompliant, despite the scale of the Islamic finance industry.
The shortfall is particularly significant in Southeast Asia, one of the world’ s most climate-vulnerable regions. The Asian Development Bank estimates that the region will need US $ 210 billion annually through 2030 to finance climate-resilient infrastructure.
Yet between 2018 and 2019, Southeast Asia received only US $ 27.8 billion in climate finance, representing just five per cent of total climate finance flows into the Asia-Pacific region.
Shahril believes Islamic finance could play a much larger role in addressing this imbalance and in supporting more inclusive growth across the region.
BLUE ECONOMY FOCUS
Against this backdrop, Malaysia is increasingly positioning the blue economy as a national priority by introducing a blueprint to align policies across aquaculture, renewable ocean energy, green shipping, and ecotourism.
Maybank has sought to support this direction through initiatives such as a proposed“ blue sukuk” with the Sabah government, intended to finance marine conservation, sustainable fisheries, and coastal ecosystem restoration projects linked to blue carbon opportunities.
For Shahril, sustainable financing is closely linked to long-term regional resilience, particularly for ASEAN economies that are closely tied to coastal and marine ecosystems.
“ Islamic finance is a major global market, projected to exceed US $ 3 trillion,” he said.“ We believe Islamic finance can play a much larger role in financing ASEAN’ s green transition and in creating more inclusive growth.”-
Islamic finance evolution
EMIRATES Islamic has introduced the UAE’ s first Shariah-compliant Certificate of Deposit( CD) Programme. This initiative reflects the growing development of Islamic banking markets and the UAE’ s ambition to strengthen its standing as a global Islamic finance hub.
Traditionally used by institutional investors as short-term liquidity tools, certificates of deposit have long played an important role in conventional financial markets.
Introducing a Shariah-compliant version into the Islamic banking ecosystem offers investors an additional avenue for diversifying their portfolios while remaining aligned with faith-based investment principles.
Structured with a programme size of US $ 2 billion, the initiative enables investors to participate across a range of tenors and currencies in response to growing demand for more flexible Islamic liquidity management solutions.
Emirates Islamic Chief Executive Officer Farid AlMulla described the launch as an important milestone for the institution and the wider Islamic finance landscape.
“ We are proud to introduce our Certificate of Deposit Programme, a significant offering that reinforces Emirates Islamic’ s standing as a global leader in Islamic banking,” he said.
The move also aligns with broader national ambitions under the UAE Strategy for Islamic Finance and Halal Industry 2031. The‘ We the UAE 2031’ vision aims to enhance the country’ s competitiveness in Islamic banking and financial innovation.
Globally, the certificate of deposit market continues to expand, with outstanding value at approximately US $ 729 billion and projected to exceed US $ 1.2 trillion by 2033. US dollar-denominated issuances account for 46 per cent of the market.
This figure further underscores sustained demand for short-term investment instruments.
For Emirates Islamic, the programme is as much about market positioning as it is about product diversification. By introducing one of the earliest Shariah-compliant currency CD programmes worldwide, the bank aims to broaden
FUTURE FINANCE FOCUS: Emirates Islamic strengthens its Islamic banking portfolio with an innovative liquidity instrument.
funding channels and attract new investor segments.
As Islamic finance continues to evolve beyond traditional banking products, innovations in liquidity management are increasingly important to strengthen resilience and competitiveness across the sector.-