Analysis of Growth of Ijara Investment in Pakistan (A case study on Meezan Bank)
Keywords:
Net Ijara Investment, Share Capital, Deposits and other accountsAbstract
Pakistan is among those countries that played an imperative role for promoting Islamic Banking and Finance. Islamic Banking industry has dramatically grown and its annual growth rate is more than 30 % during the past few years.( SPB-IBB-June 2014) and it has nationally achieved around 10% of the total market share of overall banking industry (SBP: Strategic Plan Islamic Banking Industry of Pakistan 2014 – 2018).Ijara financing is one of the most popular modes of Islamic finance and its total share is 8.5% of overall financing during the recent year up to June 2014 (SPB-IBB-June 2014).Currently there 5 full fledge Islamic Banks, 461 Islamic Banking branches of Conventional Banks are working as of June 30-2014 in Pakistan (Banking Policy & Regulations Department, SBP). Researcher has selected the leading Islamic Bank, Meezan bank as a case study, the aim of this study is to analyze the Ijara financing and its growth. Deposits and other accounts and Share Capital are used as an independent variables and Net Ijara Investment is taken as dependent variable. Data is collected from financial statements of bank (secondary source) for the period of 7 years from 2007 to 2013. Results of the study show that all the estimated coefficients are significant.