A strategic enabler for corporate growth

Islamic banking is increasingly recognised not only as a faith aligned option, but as a strategic enabler for corporates navigating growth, diversifying capital sources, and accessing government aligned opportunities. For corporate leaders, its significance lies in its ability to unlock new markets, capital sources, and stakeholder relationships regardless of faith-driven reasons.

1: Accessing new markets

Islamic banking enables corporates to tap into high-growth, underserved markets where Shariah compliance is a fundamental requirement, particularly across the GCC, Southeast Asia, and parts of South Asia and Africa. This is particularly relevant in jurisdictions such as Saudi Arabia, where Islamic finance is deeply embedded in the financial ecosystem and accounts for 75 per cent of total banking assets. In such markets, Shariah compliance is not only preferred; it is expected.

Islamic banking helps corporates enter these markets more smoothly by aligning with local norms, strengthening reputational capital, and enabling confident operations in culturally and ethically sensitive environments.

Government support and mandate

Governments in key markets are positioning Islamic finance as a mainstream tool to mobilise capital and drive private sector growth. In many jurisdictions, particularly in the GCC, Southeast Asia, Pakistan and Türkiye, Islamic finance is a government-backed pillar of economic development.

Key initiatives include:

By prioritising Islamic banking, corporates can gain preferential access to sovereign backed initiatives such as infrastructure projects and public-private partnerships. These solutions are particularly relevant for corporates in high-growth sectors such as logistics, food production, tourism, and FinTech, where Islamic banking can support expansion, enhance export competitiveness, and align with national
development priorities.

Moreover, many governments offer tangible incentives for Islamic finance adoption, including tax neutrality measures, simplified Sukuk listing requirements, and even state-backed guarantees. For corporates seeking to future-proof their regional strategy, Islamic banking is not just a compliance consideration, it is a commercially sound,
policy-aligned opportunity.

UAE government renews strategic focus on Islamic finance

Islamic banking in the UAE in figures (as of H1 2025)

Source: Central Bank of the UAE (CBUAE), LSEG Analysis

Looking ahead, the strategy is poised to strengthen regulatory frameworks and support the growth of local Islamic banks. It effectively promotes an “Islamic-first” approach to banking and finance within the UAE. Furthermore, the strategy positions the UAE as a leading player in the global Sukuk market, with its targets expected to make it the third-largest contributor by 2031, after Malaysia and Saudi Arabia.

2: Strategic positioning

4 Tracking Trade and Development: UNCTAD’s Data Insights Highlight Key Trends - United Nations Conference on Trade and Development (UNCTAD)

In addition to leveraging strategic and investor alignment to initiate market entry, operational alignment ensures long-term viability. For corporates, this means translating Shariah principles into day-to-day business practices, from contract structuring to how suppliers and clients expect to engage. Without this alignment, companies risk transactional friction, missed opportunities, or exclusion from key value chains.

Operational integration of Islamic banking goes beyond regulatory compliance. It enables businesses to build trust, conduct transactions smoothly, and scale sustainably in markets where faith-based norms shape commercial expectations.

Trade and investment across the South-South Corridor—linking the GCC, South Asia, and ASEAN—is expanding rapidly, with goods trade reaching USD5.7 trillion in 2023⁴, now accounting for nearly a quarter of global trade.

5 The halal corridor: A $2.2 trillion market opportunity | Salaam Gateway - Global Islamic Economy Gateway
6 Sustainable Islamic supply chain: Standard Chartered Saadiq goes the extra mile in to support the Halal trade ecosystem - The Asia Connects
7 Islamic Trade Finance: New Silk Road Getting Crowded - Global Finance Magazine

Islamic banking is emerging as a key enabler, offering harmonised, cross-border financial solutions tailored to the needs of businesses expanding cross Muslim-majority economies. These key initiatives are helping corporates access capital, manage risk, and navigate complex regulatory environments:

Halal Corridor: A USD2.2 trillion market opportunity connecting Halal ecosystems across Southeast Asia, the Middle East, and Africa, backed by Islamic finance.⁵

Through Shariah-compliant instruments such as trade and project financing, guarantees, and cross-border Sukuk issuance, Islamic banking provides corporates with the financial infrastructure to scale confidently across
emerging markets.

Islamic supply chains: Standard Chartered Saadiq’s Halal360 initiative connects businesses across geographies through Shariah-compliant supply chains, facilitating trade finance and logistics for Halal products.⁶

Islamic trade finance networks: EY’s Global Islamic Banking Centre predicts that Islamic trade finance will become the preferred choice for high-growth markets like Indonesia, Malaysia, Qatar, Saudi Arabia, Türkiye, and the UAE.⁷

Halal Corridor: Key Halal importers and exporters

Source: State of the Global Islamic Economy - Dinar Standard

Akij Food and Beverage Limited (AFBL), a leading food and beverage manufacturer in Bangladesh’s fast-moving consumer goods sector, secured a landmark long-term financing facility arranged by Standard Chartered, in partnership with the Development & Agency Finance (DAF) and Coverage teams. Acting as the sole mandated lead arranger, structuring bank, investment and security agent, and financier, the bank delivered a tailored solution that enabled AFBL to fund its expansion plans despite a turbulent economic and political environment.

AFBL was seeking competitively priced, long-term financing in hard currency to support its growth ambitions. Standard Chartered structured a EUR 30.9 million facility with an 8.5-year tenor, backed by a 95 per cent guarantee from Euler Hermes Aktiengesellschaft, Germany’s official export credit agency (ECA). The guarantee significantly reduced risk and improved pricing, making the facility both attractive and viable even in a volatile environment. The proceeds were used to finance machinery and equipment to expand AFBL’s production lines for carbonated drinks, bottled water, and snacks.

This was AFBL’s first Islamic ECA-backed financing, and the first of its kind in Bangladesh guaranteed by Euler Hermes . The transaction required close coordination with regulators, exporters, and the ECA to align the financing structure with local and international requirements. Despite these complexities, the facility was executed smoothly, demonstrating Standard Chartered’s ability to deliver innovative cross-border solutions.

For corporates looking to fund strategic growth, this case highlights how Islamic financing, when paired with ECA guarantees, can offer a powerful alternative to conventional debt. Whether driven by board mandates, investor preferences, or market positioning, companies can access long-term, competitively priced capital while benefiting from enhanced credit protection.

This transaction highlights Standard Chartered’s position as a leader in bespoke Islamic financing solutions across emerging markets, and reaffirms its commitment to guiding clients expertly and confidently through economic uncertainty.

3: Unlocking new capital sources

Corporates looking to diversify their funding sources and accelerate growth can gain a strategic advantage through Islamic banking, which opens access to capital sources that are often overlooked in conventional finance, through instruments such as Sukuk and Islamic syndicated facilities. These instruments attract a wide range of investors, including Islamic financial institutions, sovereign wealth funds, and ethical investors, enabling corporates to broaden their investor base and reduce dependency on traditional debt markets.

Furthermore, investor demand for Shariah-compliant assets continues to outpace supply, creating favourable conditions for issuers. Many corporates have successfully leveraged this demand to negotiate competitive pricing on Sukuk and gain access to international investment pools that prioritise ethical and faith-based mandates.

Private credit introducing ‘lighter’ financing options

Beyond public debt markets, global private credit markets are expanding, projected to
reach USD4.9 trillion by 2029⁸.

Corporates are increasingly turning to this type of financing for long-term, flexible capital. Islamic banks are entering this space with Shariah-compliant private credit solutions that offer tailored structures, faster execution, and confidentiality.

For mid-sized and large corporates, this presents a viable alternative to traditional loans or Sukuk issuance. Whether financing infrastructure, equipment, or expansion projects, Islamic private credit can enable corporates to access new investor segments, navigate tighter regulations, and align funding with strategic growth plans, all while maintaining reputational strength in markets where Shariah-compliance matters.

8 2029 Private Market Horizons - PitchBook

In July 2025, UAE-based real estate developer Arada partnered with Standard Chartered for its sixth Sukuk issuance—its largest single-tranche offering to date. Standard Chartered acted as Joint Global Coordinator, Joint Lead Manager, and Bookrunner, reinforcing its leadership in the region’s capital markets.

Arada’s objectives for the transaction included:

raising around USD450 million,
achieving pricing inside fair value,
the ability to allocate to international accounts, and
achieving a high quality orderbook.

To ensure UAE investor participation, the Sukuk structure was revised to meet updated regulatory requirements and Shariah standards for Sukuk issuance. This alignment enabled seamless access for UAE and GCC-based institutional investors, while also aligning with international investor requirements.

The outcome exceeded expectations. The issuance was oversubscribed 4.4 times, achieved the tightest reoffer yield for Arada at 7.15 per cent, and secured allocations to top-tier regional and international real money accounts. Notably, substantial allocation was given to international investors, despite a 47.5bps-60bps price tightening, underscoring the strength of Arada’s credit profile and investor confidence.

This transaction not only marked a milestone in Arada’s capital markets journey but also reinforced Standard Chartered’s position as a trusted partner for high-yield corporate issuances. With a proven track record of leading every public USD benchmark offering for Arada, Standard Chartered continues to set the standard in real estate issuance, Islamic structuring, and ratings advisory across the Middle East.