Top Islamic Banks in the World 2026

This article is for informational purposes only and does not constitute financial advice. Consult a qualified financial adviser before making banking or investment decisions.

Islamic banking is one of the fastest-growing segments of the global financial system. Operating on principles rooted in Shariah law — prohibiting interest (riba), excessive uncertainty (gharar), and speculation (maysir) — Islamic banks offer an alternative framework built around profit-sharing, asset-backed financing, and ethical investment. As of 2026, the global Islamic finance industry is estimated to manage assets in the multi-trillion dollar range, with major hubs in the Gulf Cooperation Council (GCC), Southeast Asia, and South Asia.

This guide profiles the top Islamic banks in the world, covering their headquarters, key services, approximate scale, and notable strengths. It also explores the fastest-growing markets, what to look for when choosing an Islamic bank, and the critical difference between fully Islamic institutions and the Islamic windows offered by conventional banks.

For context on the broader halal economy, see our halal industry insights, our country market profiles, and our halal business directory.

Islamic Banking Principles: A Brief Overview

Before ranking institutions, it helps to understand the core principles that govern Islamic banking:

• No riba (interest): Charging or paying fixed interest is prohibited. Instead, banks earn returns through profit-sharing (mudarabah), leasing (ijarah), and cost-plus financing (murabahah).
• Asset-backed financing: Every financial transaction must be linked to a real, tangible asset. This prevents the kind of purely speculative financial engineering common in conventional markets.
• Profit and loss sharing: Risk is shared between the bank and the customer. In mudarabah arrangements, the bank provides capital and the customer provides expertise; profits are split at an agreed ratio and losses borne by the capital provider.
• Ethical screening: Islamic banks are prohibited from financing industries considered haram, including alcohol, tobacco, pork, pornography, weapons of mass destruction, and conventional interest-bearing financial services.
• Shariah Supervisory Board: Each Islamic bank must maintain a board of qualified Islamic scholars who review and approve all products and transactions for Shariah compliance.

Key Metrics for Ranking Islamic Banks

Ranking Islamic banks requires a different lens from conventional banking league tables. Key metrics include:

• Total Shariah-compliant assets: The headline figure most used in global rankings, analogous to total assets in conventional banking.
• Shariah compliance rating: Assessed by independent agencies such as the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) and the Islamic Financial Services Board (IFSB).
• Global presence: Cross-border operations, correspondent banking relationships, and the ability to serve Muslim communities in diaspora markets.
• Product breadth: Range of retail, commercial, and investment banking products structured under Shariah-compliant contracts.
• Financial health: Capital adequacy ratios, non-performing financing ratios, and return on equity.

Top Islamic Banks in the World 2026

1. Al Rajhi Bank — Saudi Arabia

Headquarters: Riyadh, Saudi Arabia | Type: Fully Islamic

Al Rajhi Bank is consistently ranked as the world's largest Islamic bank by total assets and market capitalisation. Founded in 1957 as a money-changing business, it converted to a fully Shariah-compliant banking model and is today one of Saudi Arabia's most profitable financial institutions. Al Rajhi operates an extensive retail network across Saudi Arabia and has established operations in Malaysia, Jordan, and Kuwait.

Key services: Retail banking (current accounts, home finance, auto finance), corporate banking, treasury and capital markets, digital banking, investment products structured under murabahah and ijarah contracts.

Approximate size: [TBD — verify from Al Rajhi Bank annual report]

Notable strength: Dominant domestic retail franchise in the world's largest Islamic finance market; strong digital banking platform serving millions of retail customers; fully dedicated to Islamic finance with no conventional windows.

2. Kuwait Finance House (KFH) — Kuwait

Headquarters: Kuwait City, Kuwait | Type: Fully Islamic

Kuwait Finance House was established in 1977 as the first Islamic bank in Kuwait and is one of the oldest dedicated Islamic financial institutions in the world. KFH has aggressively expanded internationally, with a significant presence in Malaysia (through KFH Malaysia), Turkey (through Kuveyt Turk), Germany (through KT Bank), and Bahrain. Its 2022 acquisition of Ahli United Bank further expanded its regional footprint.

Key services: Retail and corporate banking, real estate financing (ijarah muntahia bittamleek), trade finance, sukuk issuance, private banking, wealth management.

Approximate size: [TBD — verify from KFH annual report]

Notable strength: One of the most internationally diversified Islamic banks globally; strong sukuk origination capability; regulated Islamic banking presence in Europe via KT Bank Germany.

3. Dubai Islamic Bank (DIB) — UAE

Headquarters: Dubai, United Arab Emirates | Type: Fully Islamic

Dubai Islamic Bank was established in 1975 and holds the distinction of being the world's first fully fledged Islamic commercial bank. DIB is listed on the Dubai Financial Market and has grown substantially through organic expansion and the 2020 acquisition of Noor Bank. It serves retail, corporate, and wholesale banking customers across the UAE and has operations in Pakistan, Jordan, Turkey, Kenya, Bosnia, and Indonesia.

Key services: Retail banking, corporate and institutional banking, real estate financing, sukuk structuring, treasury, wealth management, digital banking.

Approximate size: [TBD — verify from DIB annual report]

Notable strength: Pioneer status in Islamic banking; strong sukuk franchise; growing presence across Africa and Asia; robust digital transformation programme.

4. Abu Dhabi Islamic Bank (ADIB) — UAE

Headquarters: Abu Dhabi, United Arab Emirates | Type: Fully Islamic

Abu Dhabi Islamic Bank was incorporated in 1997 and is majority-owned by Abu Dhabi government entities. ADIB has built a reputation for product innovation, being among the first Islamic banks to offer a fully digital account opening process and Shariah-compliant home finance products with competitive pricing. It has operations in Egypt, Saudi Arabia, the UK, and Iraq.

Key services: Retail and personal banking, business and corporate banking, private banking, international banking, insurance (takaful), cards and payments.

Approximate size: [TBD — verify from ADIB annual report]

Notable strength: Strong retail brand in the UAE; recognised for digital innovation; award-winning takaful (Islamic insurance) products; growing Egyptian operations serving a large underbanked Muslim population.

5. Bank Islam Malaysia Berhad — Malaysia

Headquarters: Kuala Lumpur, Malaysia | Type: Fully Islamic

Bank Islam Malaysia was established in 1983 as Malaysia's first Islamic bank and played a foundational role in building Malaysia's world-class Islamic finance regulatory infrastructure. It operates a nationwide branch network and is listed on Bursa Malaysia. Bank Islam is supervised by Bank Negara Malaysia under the Islamic Financial Services Act 2013, one of the most comprehensive Islamic finance regulatory frameworks globally.

Key services: Retail banking, SME banking, corporate banking, treasury, trade finance, unit trust (amanah saham), Shariah-compliant mortgages (home financing-i), personal financing-i.

Approximate size: [TBD — verify from Bank Islam annual report]

Notable strength: Pioneer of Malaysia's Islamic finance ecosystem; strong SME banking franchise; deep expertise in retail Islamic finance products; close relationship with JAKIM and Bank Negara Malaysia.

6. Bank Muamalat Malaysia Berhad — Malaysia

Headquarters: Kuala Lumpur, Malaysia | Type: Fully Islamic

Bank Muamalat was established in 1999 following the Asian financial crisis. It is the second fully Islamic commercial bank in Malaysia and has carved a niche serving the Bumiputra community, government-linked companies, and SMEs.

Key services: Retail and consumer banking-i, business banking-i, corporate banking-i, treasury-i, takaful referral services, halal industry financing.

Approximate size: [TBD — verify from Bank Muamalat annual report]

Notable strength: Strong government and GLC relationships; dedicated halal industry financing unit; niche expertise serving Malaysia's Bumiputra entrepreneurial community.

7. Maybank Islamic Berhad — Malaysia

Headquarters: Kuala Lumpur, Malaysia | Type: Islamic subsidiary of Maybank

Maybank Islamic is the Islamic banking subsidiary of Malayan Banking Berhad (Maybank), Southeast Asia's fourth-largest bank by assets. It benefits from Maybank's extensive regional network across ASEAN and is consistently one of the largest Islamic banking operations in Southeast Asia by total assets.

Key services: Full range of retail and corporate Islamic banking products including home financing-i, hire purchase-i, trade finance-i, sukuk origination, treasury-i, and wealth management-i.

Approximate size: [TBD — verify from Maybank Islamic annual report]

Notable strength: Leverages Maybank's regional network across Malaysia, Singapore, Indonesia, Philippines, and beyond; strong sukuk origination capability; competitive pricing enabled by parent bank scale.

8. Bank Melli Iran — Iran

Headquarters: Tehran, Iran | Type: Fully Islamic (state-owned)

Bank Melli Iran is the largest bank in Iran by total assets and one of the largest Islamic banking institutions in the world by balance sheet size. Iran operates one of the few fully Islamised banking systems in the world — all Iranian banks were legally required to convert to Islamic banking following the 1983 Law for Usury-Free Banking. Bank Melli serves as a primary correspondent bank for Iran's international trade, though its global operations are significantly constrained by international sanctions.

Key services: Full retail, commercial, and corporate banking services under musharakah, mudarabah, qard al-hasan, and other Shariah-compliant contracts.

Approximate size: [TBD — Iranian banking data subject to significant reporting constraints]

Notable strength: Scale and domestic market dominance; operates within one of the world's only fully Islamised national banking systems; international accessibility is severely limited by sanctions.

9. Meezan Bank — Pakistan

Headquarters: Karachi, Pakistan | Type: Fully Islamic

Meezan Bank was established in 2002 as Pakistan's first dedicated Islamic commercial bank and has grown to become the country's largest Islamic bank and one of its most profitable overall banking franchises. Pakistan's State Bank has actively promoted Islamic banking, and Meezan has consistently outperformed conventional peers on key profitability metrics.

Key services: Retail banking, SME and corporate banking, car ijarah (Islamic auto finance), home musharakah, trade finance, Shariah-compliant savings (profit and loss sharing accounts), sukuk investment.

Approximate size: [TBD — verify from Meezan Bank annual report]

Notable strength: Market leader in a country of 230+ million Muslims; strong Shariah governance reputation; recognised by international bodies as a model for emerging market Islamic banking development.

10. Islamic Development Bank (IsDB) — Multilateral

Headquarters: Jeddah, Saudi Arabia | Type: Multilateral Development Bank (Islamic)

The Islamic Development Bank is a multilateral development institution serving 57 member countries across the Muslim world. Established in 1975 under the aegis of the Organisation of Islamic Cooperation (OIC), IsDB finances development projects across infrastructure, education, health, agriculture, and private sector development — all structured on Shariah-compliant terms. IsDB is a AAA-rated issuer of sukuk and a key architect of global Islamic finance standards.

Key services: Project financing, equity participation, technical assistance, sukuk issuance, trade finance (through ITFC), private sector financing (through ICD).

Approximate size: [TBD — verify from IsDB annual report]

Notable strength: AAA credit rating enabling low-cost sukuk issuance; global authority on Islamic finance standards; direct development impact across 57 OIC member countries.

Fully Islamic Banks vs Islamic Windows of Conventional Banks

A key distinction for customers and investors is the difference between a fully Islamic bank and an Islamic window:

Fully Islamic banks (such as Al Rajhi, Dubai Islamic Bank, and Meezan Bank) operate exclusively under Shariah principles. Every product, deposit, financing facility, and treasury operation is structured under an Islamic contract.

Islamic windows are dedicated Islamic banking divisions within conventional banks. Examples include HSBC Amanah, Standard Chartered Saadiq, and Maybank Islamic. Critics argue that funds in Islamic windows may be commingled with conventional interest-bearing funds at the parent level. Well-structured Islamic subsidiaries with ring-fenced capital can offer genuine Shariah compliance alongside the operational advantages of a larger banking group.

When choosing between a fully Islamic bank and an Islamic window, customers should review the bank's Shariah Supervisory Board composition and AAOIFI or IFSB compliance certification status. Our halal certification directory lists relevant Islamic finance certification and standards bodies.

Fastest-Growing Islamic Banking Markets

Beyond the established GCC and Malaysian hubs, several markets are showing accelerated Islamic banking growth:

• Bangladesh: A rapidly growing Islamic banking sector with strong demand from a population of 170+ million Muslims and a growing export-oriented garment sector seeking halal-certified financing.
• Indonesia: The world's largest Muslim-majority country has been consolidating its Islamic banking sector, with Bank Syariah Indonesia (BSI) created in 2021 from the merger of three state-owned Islamic banks.
• Turkey: Known as participation banks in the Turkish regulatory framework, Islamic banks have expanded their market share significantly, with KFH (via Kuveyt Turk) and Al Baraka building strong presences.
• Kazakhstan and Central Asia: A growing number of OIC member states in Central Asia are developing Islamic finance regulatory frameworks, driven by IsDB technical assistance and Gulf capital.
• Sub-Saharan Africa: Kenya, Nigeria, and Tanzania are developing Islamic banking frameworks targeting their significant Muslim minority populations and GCC investment flows.

What to Look for When Choosing an Islamic Bank

1. Shariah Supervisory Board credentials: Look for a board composed of recognised Islamic finance scholars with no conflicts of interest.
2. AAOIFI or local regulatory compliance: Check whether the bank adheres to AAOIFI standards or the standards set by your national Islamic finance regulator.
3. Product range and competitive pricing: Islamic banking products should be competitive with conventional alternatives on total cost of financing.
4. Financial stability: Review the bank's capital adequacy ratio (CAR), non-performing financing (NPF) ratio, and credit ratings from major agencies.
5. Digital banking capability: A strong mobile and online banking platform matters regardless of whether the bank is Islamic or conventional.
6. International reach: Check whether the bank has correspondent banking relationships or branches in your key markets.

For businesses in the halal sector seeking trade finance or export support, explore our halal business directory and country market guides for market-specific resources.

Conclusion

Islamic banking has moved well beyond a niche alternative to become a mainstream financial system serving hundreds of millions of customers across Asia, the Middle East, and Africa. The institutions profiled here — from Al Rajhi Bank's retail dominance in Saudi Arabia to Meezan Bank's growth story in Pakistan and the Islamic Development Bank's multilateral development mandate — represent the breadth and depth of global Islamic finance.

For more on the global halal economy, explore our industry news and analysis, our halal certification body directory, and our profiles of 34 halal market countries.

Most of the institutions ranked above also distribute Islamic insurance through partner takaful operators or in-house subsidiaries — see our takaful explainer for how the underlying cooperative-risk model works.

These institutions are also among the largest arrangers and investors in the global sukuk market — for a structural primer on Shariah-compliant fixed income, see our sukuk explainer.