ADB and Bangko Sentral ng Pilipinas Showcase Opportunities in the Philippines for Foreign Islamic Banking and Financial Institutions

In September 2024, the Asian Development Bank (ADB) published a comprehensive report exploring the potential and demand for Islamic banking and finance services in the Philippines. Titled Unlocking the Potential of Islamic Finance in the Philippines: A Market Analysis and Landscape Report, the study found that many Muslim Filipinos—many of whom own and operate micro, small, and medium enterprises (MSMEs)—prefer Islamic financial services but have limited access to them.  

The report highlighted a scarcity of halal options, particularly in digital banking, insurance, investment, and MSME financing. This presents a significant opportunity for Islamic banking and financial institutions to fill the void. In addition, the study examined the groundwork laid by the Philippine government, the local Bangsamoro government, and multilateral organizations, such as ADB, to facilitate efforts to build a robust Islamic finance ecosystem and position the Philippines as a regional hub for these services. 

ADB and the Bangko Sentral ng Pilipinas (BSP) then assembled a team of experts to embark on a roadshow in Indonesia and Malaysia, to promote the Philippines as an investment destination for Islamic banking and financial institutions. Among the team members were Ms. Chuchi G. Fonacier, BSP Deputy Governor; Ms. Arifa A. Ala, BSP Assistant Governor and Chairperson of the Islamic Finance Coordination Forum; Mr. Mohammad Farrukh Raza, Founder and Group Chief Executive Officer of Islamic Finance Advisory & Assurance Services (IFAAS) and Finance Specialist (Consultant) of ADB; and Ms. Maria Cecilia T. Sicangco, Counsel and Co-Team Leader of ADB’s Islamic Finance for the Philippines Technical Assistance. 

On 17–19 September 2024, the ADB-BSP team began the roadshow in Jakarta, Indonesia, presenting the findings of the study to representatives of local financial and banking institutions and the Indonesian Chamber of Commerce and Industry (KADIN). The event was keynoted by H.E. Gina A. Jamoralin, the Philippines’ ambassador to Indonesia. Following the event, the ADB-BSP delegation met with the senior management teams of several Islamic banks, such as Bank BJB Syariah, Bank Mega Syariah, Bank Syariah Artha Madani, Bank Syariah Indonesia, Hijra Islamic Neobank, Maybank Indonesia, and Panin Dubai Syariah Bank. 

On 23–25 September 2024, the ADB-BSP team continued the roadshow in Kuala Lumpur, Malaysia, with the special participation of H.E. Maria Angela A. Ponce as keynote speaker. Among the attendees were Dr. Ghiath Shabsigh, Secretary-General of the Islamic Financial Services Board; Mr. Yusry Yussuf, Chief Executive Officer of the Islamic Banking and Finance Institute Malaysia (IBFIM); senior management teams of Islamic banks operating in Malaysia; and officials of fintech companies, notably CWALLET, INFOPRO, and the DDCAP group. Afterwards, the ADB-BSP delegation held bilateral meetings with Islamic banks, notably Al Rajhi Bank (Malaysia), AmBank Islamic, Bank Islam Malaysia, CIMB Islamic Bank, Hong Leong Islamic Bank, HSBC Amanah, RHB Islamic Bank, and MUFG Malaysia.  

ADB’s support for the study and the roadshow is aligned with the objectives of the Islamic Finance for the Philippines Technical Assistance, which is implemented by the Law and Policy Reform Program of ADB’s Office of the General Counsel. These initiatives build on past successes of the TA, which include the enactment of Republic Act No. 11439, the Philippines' Islamic banking law, the issuance of various policies and regulations, and the capacity building of Filipino regulators and finance professionals, in partnership with IBFIM and IFAAS.