All 10 fully operational Islamic banks, or Shariah Banks, in Bangladesh have experienced share price increases over the past seven trading sessions as deposits across the sector grew in the second quarter (April-June) of 2025.
The upward trend, analysts say, reflects renewed confidence among customers and investors, even in the five Shariah-based banks currently facing a potential merger.
A Bangladesh Bank report stated recently that “Islamic banking has experienced rapid growth in the global financial system due to its unique features of asset-backed transactions, risk sharing, inclusiveness, and ethical values. In line with global trends, Islamic banking has also witnessed a notable growth in Bangladesh following strong public demand and policy support from the government as well as Bangladesh Bank.”
On the other hand, regarding the merger banks' share price rise, Tanvir Hosain, an investor in the share market, told Dhaka Tribune: “I think share prices have surged again after news spread that the central bank was considering partial compensation to shareholders or issuing shares in a new Islamic bank after the merger of five.”
In this situation, news of the merger process of the banks and the news of possible compensation for shareholders has sparked renewed hope in the stock market, he added.
Seeking anonymity, a Dhaka Stock Exchange (DSE) director said: “The interim government earlier this year introduced the Bank Resolution Ordinance 2025, aimed at freeing banks from the control of controversial businessmen S. Alam and Nazrul Islam Majumder. Under the ordinance, the interests of depositors will be protected; however, shareholders will not receive any compensation. Bangladesh Bank has stated that shareholders are responsible for funds misappropriated through anonymous loans.”
“Moreover, the banks lack sufficient assets to cover liabilities, including deposits. As a result, an initiative was taken to declare the shares of five listed banks worthless, causing their share prices to plummet. After that, Islamic banks see a share price fall.”
“But, since the general shareholders are not liable in the event of the banks' deteriorating condition, there has been a demand for compensation or shares in the proposed new bank. Recently, there has been news that Bangladesh Bank is considering it. With this news earlier, Bangladesh Bank also dissolved governing bodies of major Islamic banks and restructured those bodies to bring back public confidence in the aftermath of regime change. They even provided liquidity support to the Islamic banks. In the meantime, Shariah banks’ July report showed that deposits are rising because of depositors’ confidence and Bangladesh Bank’s initiative, which also motivates the stock market investors. I think all these things are helping the prices of the shares to have started to recover again,” he explained.
Regarding the overall Islamic Banking System (IBS), the Bangladesh Bank report stated that in the recent past the investment growth has surpassed the deposit growth due mainly to fund mismanagement by some banks. It has caused a fall in the excess liquidity of the IBS and created a liquidity problem.
To address the situation, the central bank has provided liquidity support to the Islamic banks through the Islamic Banks Liquidity Facility (IBLF), Mudarabah Liquidity Support (MLS), and Special Liquidity Support (SLS).
Apart from these, recently they also introduced the Liquidity Support Guarantee (LSG), through which strong banks can provide liquidity support to the weak banks, including Islamic banks.
Besides, they also dissolved governing bodies of major Islamic banks and restructured those bodies to bring back public confidence in the aftermath of regime change, which will help the Islamic banks attain the public confidence and lead the sector to operate on a sound footing.
There are 10 full-fledged Islamic banks in Bangladesh operating with 1,699 branches amongst the total 11,372 branches in the whole banking system as to June 2025.
In addition, 41 Islamic banking branches of 17 conventional commercial banks and 905 Islamic banking windows of 21 conventional commercial banks are also providing Islamic financial services in Bangladesh.
Deposit growth
According to Bangladesh Bank's latest data, the Islamic Banking System (IBS) has significant contributions in terms of deposits, investment, exports, imports, remittances mobilization, and employment generation in Bangladesh.
Total deposits of the Islamic banking system stood at Tk457,207 crore at the end of June 2025, with an increase of Tk14,245 crore, or 3.22%, as compared to Tk442,962 crore at the end of March 2025.
Deposits of 10 full-fledged Islamic banks stood at Tk397,791 crore, branches of conventional banks at Tk25,333 crore, and windows of conventional banks at Tk34,083 crore at the end of June 2025.
As of June 2025, the total Islamic banking system represents a 24.35% share in terms of deposits in the total banking industry, while it accounted for a 29.18% share in terms of investments.
The share of remittance of the Islamic banking system among the entire banking industry recorded 25.39% at the end of June 2025. IBS has contributed 17.41% share of agricultural credit of the entire banking industry at the end of June 2025.
However, the total deposits of the banking sector stood at Tk20.21 lakh crore at the end of last June. At the end of June 2024, the deposits were 18.71 lakh crore.
Deposit Share
Out of total deposits of Tk457,000 crore of the Islamic banking system, 10 full-fledged Islamic banks represented 87% of deposits, while Islamic banking branches and windows represented 5.54% and 7.45%, respectively.
Data analysis revealed that among all Islamic banks, Islami Bank Bangladesh PLC received the highest amount of deposits (36.93%), followed by Al Arafah Islami Bank PLC (10.93%), Exim Bank PLC (8.02%), First Security Islami Bank PLC (7.98%), Social Islami Bank PLC (5.70%), Shahjalal Islami Bank PLC (6.46%), Standard Bank PLC (4.53%), Union Bank PLC (3.70%), Global Islami Bank PLC (2.50%), and ICB Islamic Bank Ltd. (0.23%).
Rising share prices
Data analysis from the Dhaka Stock Exchange (DSE) shows that the share price of all 10 Islamic banks went up on the last working day of Tuesday (September 30) compared to the price from September 22-24.
Even the five Shariah-based banks currently facing a potential merger also see potential growth in the bourse.
Social Islami Bank (SIBPLC): Its share price is up by 47% within 7 days since September 23. On the last working day before the Puja vacation on 30 September, its price hit Tk4.40 from 3.70 on 23 September. Although it was traded at a high of Tk13.70 on September 29 last year.
Exim Bank: The share price of this bank fell to Tk11 on August 11 last year, which fell to Tk2.90 on September 23. Since then, on the last working day, it has increased to Tk4, which is an increase of about 43%.
First Security Islami Bank (FSIBPLC): Although it was traded at Tk8.70 on September 30 last year, it fell to Tk1.90 on September 23 this year. The price increased to Tk2.60 on the last day, up by 44%.
Global Islami Bank: The share price was Tk8.30 on August 12 last year. On September 24 this year, it fell to Tk1.40. Currently, it has increased to Tk1.80.
Union Bank: Although it was traded at a high of Tk8.20 on August 12 last year, it fell to Tk1.50 on September 24 this year. The latest rate has increased to Tk1.90.
Among the other Islamic banks, Islami Bank Bangladesh PLC is leading in price at 41.20, which was Tk 40.80 on 22 September.
Al Arafah Islami Bank PLC's last share price was Tk16.90 on 24 September, which was traded at Tk16.80.
Shahjalal Islami Bank PLC share price was Tk18.60 on 30th September, which was Tk17.80 on 22nd September.
Standard Bank PLC was traded at Tk6.10 on the last working day; it was Tk5.50 on September 22.
On the last working day before the Durga Puja vacation, on 30 September, the ICB Islamic Bank Ltd share price was traded at Tk2.50 on September 24, although it traded as low as Tk2.10 on the same day.
